Pete's Point of View



1998 CaseIH 8920 MFWD tractor with 3322 hours sold for $74,500 on online farm auction yesterday in northwest Ioa - 12/24/2013

Merry Christmas folks! Hope this holiday season is a joyful & peaceful one for you & yours. This morning I got looking at our auction sale price data on Combines, JD 9770 STS's in particular. Here's what our "Calculator" pricing tool shows:
Ave. Auction Price this year: $144,710

Ave. Auction Price last year: $163,784

Ave. Auction Price 2 years ago (2011): $179,724

Ave. Auction Price 3 years ago (2010): $188,379

Ave. Auction Price 4 years ago (2009): $199,200So an 11.6% drop in value here in 2013 vs. auction prices last year. Pretty significant dip there. The previous (3) years the average auction price on JD 9770's fell 8.9%, 4.6% and 5.4%. So the depreciation rate picked up noticeably last year and hopped even higher this year. What's behind this trend?
So far this year I've seen 37.4% MORE JD 9770 STS's sold at auction vs. 2012.....and this on top of a 57.1% increase in No. sold at auction in 2012 vs. 2011. So again.....VOLUME. Or put into Economics 101 terms: Supply & Demand. Greatly increased supply of any asset for sale will affect value. Now, couple that with a more profit challenged environment and the 11.6% drop in value so far this year does makes sense. Take these facts for what they are....a BIG PICTURE look at the current reality in the used combine market. That isn't to say individual used combines for sale, especially on very nice farm retirement or estate auctions, can't or won't sell on the HIGH side....they certainly did in November on into early December, like the 2011 JD 9770 STS with 522 engine hours sold for $270,000 on a December 3, 2013 farm auction in south-central Minnesota, very strong sale price there, not done in a vacuum, many bidders in on the opportunity to acquire such a beautiful machine. But pay attention to the TIMING of that sale: Dec. 3rd. Our auction sale price data has shown for 11 years in a row now that sale prices (even on late-model Combines) have GONE UP in 4th Qtr. Why? You know motivated buyers. Same effect was out in full force this year all through November and the the 1st 10 days of December. Since then? A bit more...."choppy" I'd say in terms of auction sale price strength. Definitely some very strong sale prices rolling in around the country, especially on very good condition equipment 10+ years old, but also more sale price reports with more muted/soft sale prices. Should be an interesting last week of 2013 here and then a most intriguing 2014 in terms of used equipment values.....stay tuned.
VIDEO: 1988 JD 4450 TRACTOR SOLD FOR $69,000 ON OHIO AUCTIONA little Christmas treat here for you folks...Youtube video of a sweet 1988 JD 4450 MFWD tractor with 2239 hours selling for the 2ND HIGHEST AUCTION PRICE I've ever seen on a JD 4450, on a Dec. 7th farm auction in Upper Sandusky, OH. This sale was by my friends at United Country - Walton Realty & Auction Co:

Thanks to everyone who has dropped me notes on our new show on RFD-TV (Tuesday 4PM CST & Saturday 12:30PM CST) and thanks for watching! So fun to now have more time each week to show more equipment sell, talk to more local folks at the auction and also do a couple fun in show features like our "TRACTOR TALES" segment, the "ASK PETE" session and our "MARKET WATCH" clip that highlights recent auction sale prices of note on various equipment sold all over North America. If you can't catch the show when it airs, just set your DVR to record and watch anytime. You can also catch my ugly mug every Monday morning on the "AG DAY" TV show. I do a fun little Machinery Pete Minute segment right after the weather latest used equipment values trends, auction sale prices of note, fun stuff......more into RADIO? Tune in to "AgriTalk" live radio show every Monday morning from 10-11AM CST, heard on 70+ regional ag radio stations. Host Mike Adams and I kick around the latest auction sale price highlights, but the real fun is in taking LIVE CALL INS from listeners all over. My segment airs on Monday from 10:30AM CST - 10:55 or so. Thanks to all who listen and call in. If you have Sirrius XM satellite radio in your pickup, tractor or combine cab, you can catch "AgriTalk" re-broadcast on XM80 Rural channel at 1PM Monday afternoons about 1:30PM CST you can catch Machinery Pete talking auction prices on satellite radio. I didn't see that coming 24 years ago when I started compiling auction sale price data :)