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Used farm equipment values roared higher across Canada the first half of 2011. There were so many new record-high or near record-high auction sale prices set it was hard to keep up. The months of April, May, and June were incredible! I see this trend of rising values on all types of used equipment, but one market in particular stands out.
The 1994 John Deere 8870 tractor with 1,933 hours sold on an April 14, 2011, farm auction in east-central Saskatchewan is a good example. This tractor was a beauty, with only 1,933 one-owner hours. It had been shedded its entire life and was in pristine shape. It sold for $90,000. Remember, this auction was in Canada, so that sale price was in Canadian dollars. The exchange rate with U.S. dollar on April 14, 2011, was $1.04. So that 1994 Model 8870 actually sold for US$93,600.
How high is that? Take a look at the data table on the next page. It contains auction prices on Deere 8870 tractors. You'll find auction prices from the past three years in the top half of the table; in the bottom half, you'll find auction prices on 8870s from a decade earlier (1998 to 2001).
Look at what nice, low-hour 8870s were selling for back then. For example, $70,000 was paid for a 1996 model with 1,814 hours. It sold at a northwest Iowa auction on April 11, 2001.
That was almost a decade to the day prior to the $90,000 sale price on the Saskatchewan auction. And that Iowa tractor had approximately the same hours, too. Yet there was a $20,000 difference in sale price ($23,600 difference if converted to U.S. dollars). So the Canadian tractor was 10 years older but worth a lot more money.
See what a pair of Model 8870s with fewer than 1,000 hours sold for on auctions back in the year 1998. The first sale was $78,000 for the 1995 model with 950 hours that sold in southwest Minnesota. The second was a 1996 model with 634 hours that sold in southeast Minnesota for $75,600.
Case IH and Steiger bringing high bids
It wasn't just used Deere four-wheelers selling for big, big bucks on farm auctions in Canada the first half of 2011. Case IH and Steiger four-wheel tractors joined the high-wire auction price act, too. On an April 18, 2011, farm sale in west-central Saskatchewan, a 1987 Case IH 9130 with 5,795 hours sold for $57,000 (US$59,104 with an exchange rate of $1.03691 on 4/18/11). That's the second highest auction price I've seen on a Case IH 9130, which was only bested by the 1990 tractor with 4,155 one-owner hours that sold on a February 24, 2011, farm auction in northeast Michigan for $60,000.
Just three days later on an April 21, 2011, farm auction in southwest Manitoba, a 1986 Steiger Bearcat with 6,800 hours sold for $43,000 (US$45,130 with the exchange rate of $1.04955 on 4/21/11). That was over US$45,000 for a 25-year-old Bearcat with 6,800 hours.
Now compare that sale price with the 1984 Bearcat with 3,845 hours in good condition that sold for $19,500 on a west-central Ohio auction February 2, 2003.
Back to darker green
At that same April 14, 2011, east-central Saskatchewan sale, a 1998 John Deere 9400 four-wheel-drive tractor with 2,089 hours sold. This 9400 was in very nice condition, and it went for $142,500 (US$148,200). The previous high auction price I'd seen over the last 10 years was $118,000 given on a July 2009 sale in northeast North Dakota for a 2001 Model 9400 with 3,019 hours.
Hindsight can make us all idiots, of course. We should have bought every nice used four-wheel-drive tractor we could possibly get our hands on back in 1998 through 2003. We could have used them for a decade, cared for them well, then sold or traded them today for a profit – quite possibly a hefty profit.