With new farm equipment sales tracking downward as we venture into the used equipment auction busy season, more farmers are looking to late-model used machines. High interest rates for financing new equipment, as well as low commodity prices, are also factors driving interest in used machines.
Considering basic supply and demand principles, it makes sense Casey Seymour and Machinery Pete are seeing less late-model equipment inventory at auction than last year, and what is available now is starting to increase in price. They discuss the trend on a recent episode of the “Moving Iron” podcast.
“I mean, [John] Deere just laid off more people last week, and that was not unexpected, because you have one, now two, and we’re drifting into three years of lower sales of new [equipment]. There’s just less one-, two- and three-year-old units available — whether on the [dealer] lot, at auction or for sale privately,” Pete says.
Pete says a recent auction transaction in western Iowa illustrates his point: a 2022 New Holland CR780 with 400 sep hours (pictured above) sold for $195,700. That’s in the ballpark of 54% of the total cost of a brand new CR7. With commodity prices where they are, Pete thought he would see a lower price come in on that machine, but it was only $7,000 off the all-time average auction price.
Seymour thinks dealers will start to move more equipment off their lots to the auction market if interest rates don’t go down, considering there are real, direct costs associated with machines sitting on the lot.
But even if Federal Reserve chair Jerome Powell drops interest rates considerably — as President Donald Trump has been asking for months — Pete isn’t convinced farmers will rush to buy new equipment.
“We were already pretty iron-heavy going into this downturn. Farmers have a lot of iron,” Pete explains. “I think we could drift through ‘26 in the same belt tightening [mode], and then maybe we get into ‘27, and now its four years [into the downturn]. Does that become the point where we see more [buying] activity out of [farmer] need?”
Additional Industry Trends
Shawn Hackett, president and CEO, Hackett Financial, is spending his week closely following the results of Farm Journal’s Pro Farmer Crop Tour.
He doesn’t expect a big increase in projected corn yields coming out of the eastern Corn Belt, but he does anticipate some “really, really big numbers” from the western Iowa and eastern Nebraska portions of the tour.
“I think they’re going to come up with a crop yield somewhere around 185 to 186 (average bu./acre), and I think that is a more rational starting place for the crop based on what was planted,” Hackett says. “While that’s not going to create a problem for corn supplies anytime soon, it would move the carryout bushels and would more than justify a mid-$4 (corn) market.”
Aaron Fintel, used equipment specialist with 21st Century Equipment and CEO of High Plains Wholesale, says the two biggest needle movers in his area are two late-model John Deere machines: the 8RX tractor and S700 series combines.
Used forage harvesters are also starting to demand large dairy farmer and custom harvester businesses’ attention, he adds.
“It’s a market that used to be really wild and crazy in August and April. If you’re in the chopper business, it’s now become a more open market throughout the year — versus just those two months of activity,” Fintel says.
Head over to YouTube to watch the full episode. Hit the “Thumbs Up” button to “Like” the video and click on the “Subscribe” button to get a notification when a new episode drops.
Your Next Read: Four Pro Tips To Help You Harvest More Soybeans
