Harvester prices are flat
I took a trip to South Dakota to confirm a rumor. I had been receiving reports of a potential glut of used late-model combines this summer, so in August, I traveled to that state to determine if there was any truth to the rumor.
So why South Dakota? One of the premium late-summer consignment sales was held there by Wieman Auction the first week in August. This particular sale was huge.
Over $5 million in iron sold in one day to both live and online bidders. Nearly 40 combines and 140 heads changed hands, offering the ideal location to see what was happening to the value of used harvesting gear. Plus, the Presbyterian church ladies of Marion, South Dakota, were serving up their famous pie along with lunch that day. It was a win-win situation for my stomach as well as for my note-taking.
I’ve been holding my breath for some time waiting for the values of late-model combines to drop. These machines have been constantly breaking sale records over the past several years. Even the 2012 drought didn’t seem to dampen bidders’ enthusiasm for these machines.
Is there a glut?
Dealers have been selling a boatload of new combines in recent years, as well. So it only stands to reason that, eventually, all of these new combines will hit the secondary market as used machines.
That is not yet the case, as this past summer’s iron transactions prove. Final bids on the late-model Deere combines varied from flat to slightly higher than last winter.
Rich Wieman of Wieman Auction expected this when I talked to him prior to the auction. “It’s late summer, and buyers know what they will have for a crop,” he told me. “Harvest is almost here, and they are certain they can pay for a replacement combine or maybe a second or third harvester. So it’s time to make a buy.”
Sale averages are -- at best -- flat
The table on the opposite page provides you with a sampling of 60 Series and 70 Series Deere harvesters sold since last June.
So how do the average prices of these recent sales compared to transactions that took place last spring and winter as well as a year ago? Below is a time-price comparison on five different John Deere combine models:
Model 9660s averaged $101,850 in late summer compared with $73,240 last winter/spring and $79,990 in fall 2012.
Model 9760s averaged $111,446 in late summer compared with $101,643 last winter/spring and $110,820 in fall 2012.
Model 9670s averaged $143,050 in late summer compared with $136,100 last winter/spring and $140,550 in fall 2012.
Model 9770s average $154,472 in late summer compared with $148,060 last winter/spring and $145,650 in fall 2012.
Model 9870s averaged $142,900 in late summer compared with $160,500 last winter/spring and $200,250 in fall 2012.
In short, average prices for John Deere combines over the past year are about the same, except for model 9660 harvesters. Those 9660s took a $30,000 price hike in recent months! They must offer a tempting second combine for some farmers.