Demand has been high for used farm equipment over the last few years.
And prices for used equipment has also been high.
Farm Credit Canada noted in its 2023 outlook for farm equipment, released in November, that throughout 2021 and ’22, used equipment that was 4 or 5 years old was selling for prices “like what they were worth two years earlier.” They say it was due to the availability of new equipment and parts being impacted by supply-chain disruptions from pandemic-related shutdowns. FCC added farmers had to adjust by keeping their old equipment or buy used, and dealers also had to pivot by servicing or overhauling used equipment so customers could use them for another year or longer.
President and CEO of McDougall Auctioneers, Riley McChesney says they’ve seen growth in the agriculture equipment industry over the last two years, noting supply and demand, and the price of new equipment playing key roles in why prices for used farm vehicles are where they are.
“As new equipment climbs it inevitably makes good quality used equipment worth more as well. When you’re paying a million dollars for a new tractor, all of a sudden your older, good clean used equipment is worth significantly more than what it may have been 3 or 4 years ago.” McChesney said.
“If supply is short, which we’ve seen over the last couple of years for numerous reasons, then the increase in price, and then when the demand drops down, obviously prices reflect that as well.”
McChesney says he’s noticed used tractors selling at prices 20 to 25 percent higher than normal at auction, that is if the “specs and the hours are right”, but added it’s not across the board on everything.
McChesney says he hasn’t seen this kind of a trend personally, admitting he is “young in the industry”.
You can listen to the interview with Riley McChesney below.