The best and quickest way to learn what's going on?

Listen.

I consider it an honor and a privilege to get the opportunity to visit with so many great people across the ag spectrum on a daily basis. Farmers, long-time auctioneers, implement dealers, ag lenders, insurance experts, machinery brokers. Here are a few things I've picked up from talking, mostly listening, to a variety of smart folks over the last week or two.

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Some folks call them brokers; others refer to them as jockies; still others know them as scalpers. Whatever the title, these are the guys found in every region of the U.S., Canada and Mexico that make a living buying and selling used farm equipment for a profit.

They've had a tough job the last two years.

Tricky to make a buck when every type of used equipment has been selling so high. My machinery broker friend has seen it all in his decades in the biz. Toward the end of our recent conversation the broker offered an interesting insight. He feels like there are too many $100,000 to $150,000 pieces of used equipment out there right now. He thinks they're beginning to stack up.

"My last purchase was a John Deere 9500 combine for $19,000," the broker told me. "It's nothing fancy, but I bought it on an auction and drove it home. We'll be able to sell it for $25,000 or $26,000."

Click here to view auction sale prices on John Deere 9500 combines .

Last Sunday, October 18th, Piroutek Auction Service of west-central South Dakota had a small farm auction. Dan and Gayla Piroutek are great folks who I've corresponded with for years. They've been most helpful reporting the results of their farm machinery auctions. They run first-rate sales. Along with the prices from last Sunday's auction in an email, they also sent me a note mentioning that more financial stress was beginning to appear. Understandable as we're talking livestock country.

My eyes are glued right now to farm auctions in areas that are heavy in livestock and dairy. In an upcoming issue of Successful Farming magazine I'll have a report showing how values on items, such as used hay balers, hay rakes and hay inverters, have fallen over the past year while values on used grain and tillage equipment have gone up.

Click on the link to see how equipment sold on that October 18, 2009, farm auction in west-central South Dakota. My latest auction of the week videI is at www.youtube.com/user/machinerypete.

We have around 600 to 700 agriculture banks that subscribe to our Machinerypete.com Web site - many for 5, 10, 15+ years. It's been fun to get to know many of these dedicated ag lenders over the years. Recently I got a note from one such lender out in central Kansas. He passed along that 2009 looks to be a bin busting year for corn, soybeans and milo in his area. Dryland cotton and sunflowers also looked very good. Elevators, still full with new wheat crop, are preparing to dump grain on the ground.

Not surprisingly, he mentioned customers already queuing up to purchase new or used equipment before the end of the year to offset tax liability.

Couple weeks back I wrote about the possible return of regional price differences in used farm equipment values. Re-read these last sections and you'll know why I think this may occur in 2010. While some regions and segments of ag are under stress, others are more optimistic.

Looking to buy, sell or trade equipment in the next six months? Perhaps wise to be aware of what's happening around you, maybe a bit further from home in terms of prices on used equipment. Opportunity awaits those armed with good information.

Yes, as in England, not Ohio. The proper British accent was a giveaway as soon as I picked up the phone. It's not every day I get phone calls from across the pond. I had a nice chat with this English chap. A jolly good bloke. Seems he works in the financial district for an investment house. His gig is analyzing companies that manufacture farm equipment.

So he called me to quiz me about the state of the used equipment market in North America. I've had similar calls from analysts on Wall Street. Despite the bad rap everyone in the financial biz gets these days, I give these callers credit. They're digging for information, not settling for the story spun on quarterly reports and conference calls by equipment manufacturers.

I told the London analyst how I was of the mind that the market for new farm equipment here in North America is greatly tied to the used farm equipment market. How's that? Well, what's been happening with the price of new equipment the last few years? Up, up, up. How have sales been for new equipment? Very strong indeed.

At the same time, what's been happening on the used farm equipment market? Used values also have gone up, up, up. Possibly at an even stronger clip than price increases on new equipment. The key to the rise in used equipment values in my book? Strong cash flow for farmers yes, but also a very limited supply of equipment - both new and used.

Manufacturers have been holding the supply of new equipment very tight. Smart. Very smart on their part. Anyone else read last month about how one of the major manufacturers laid off a sizable number of folks from their combine production facility? I read that with interest. Why? Because it will likely cause ripples in the used combine market.

Tight supply increases pricing power.

Hmmmm, makes me think of that 1991 JD 4455 MFWD tractor with 1,423 hours sold on the October 3, 2009, farm auction in south-central South Dakota for $94,500. That's what I call pricing power.

A tremendous amount of pent up buying demand has been realized the last two years, both for new and used farm equipment. Can buying demand continue to hold strong into 2010? If supply of equipment (new and used) remains tight, then I'll say yes. Will the supply remain tight? You might want to refer back to the end of point number one.