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The intersection of supply Cycles, Auction Values, and Depreciation
The buyer of an equipment is easily identifiable. They can order what they want and have it made to their specifications. The difficulty of locating the next owner arises once the farmer has moved on from the machine, as the equipment becomes bigger and larger
AC lass 10 combine is not feasible for all farms, according to Andy Campbell, director of insights for Tractor Zoom
“He mentioned that your attire must be customized to handle the influx of grain quickly” he explained. To handle 1,200,1,300 bushels per hour, multiple trucks are necessary. It is necessary to have labor. Your dryer system’s capacity is not a concern as you may not be able to transport large quantities of grain to the town
According to Campbell, the construction of certain individuals involves a significant amount of infrastructure. “The majority of people aren’t aware of this.”. The current state of the farm economy makes it unwise to borrow money for improvements. ”
Greg Koch, owner of KD KS ales and Equipment in Washington, Iowa, said the pool of farmers looking for larger, late-model used equipment is shrinking
“The pool of second buyers for that size of equipment is very small, because the guys that are big enough to run it usually buy new because they want the warranty, the service, fewer breakdowns, ” he said. “It becomes economics 101 — the biggest bleeding comes on large planters, combines, heads. ”
The intersection of supply Cycles, Auction Values, and Depreciation
The sales cycle for combine events is typically seasonal. Peak used supply is observed in spring and early summer. Supply decreases during harvest, followed by post-harvest increases and trade-ins for newer machines. According to Campbell, the X9’s peak-to-trough inventory drawdown was 28% in 2023 and 27% in 242.
Auction values have remained consistent between 2023 and 2024 sales, as noted by him
In Campbell’s view, the price of X9 1000s was on par with that of the last 18 months, as seen in the 60 days from December 2024. “The auction values on these machines are not exhibiting a significant change year-over-year, as I have observed.”. Nevertheless, the per-hour depreciation rate is substantial. ”
The X9 combine is John Deere’s largest model on the market today
Determining the depreciation is a helpful financial exercise to calculate before purchasing, although the first-owner rate can be tricky to calculate since it is influenced by the starting and ending points of sale. Once the machine is sold for a second or third time, the rates become more predictable, according to Campbell
Several years ago, when these combines were being ordered new, the farm economy was much different. Now, late-model used machines with low hours are not seeing the resale prices one might have expected at the time of purchase
“When dealers agreed on a trade-in value, say nine months ago, the market has now dropped so much that it’s probably already below profitability for the dealer, ” Campbell said. “This isn’t unique to combines; it’s all equipment right now. ”
According to Koch, there is a significant difference between new values and the price at which second-hand equipment owners are willing to pay
The potential bottleneck caused by a new large equipment model must be taken into account by smaller producers, according to the speaker. “It’s not solely about acquiring the first item.”. A larger combine would probably need bigger grain carts, more semis or a faster grain leg to keep it moving. ”
Recent Sales Data
A search of machinefinder. Com, Deere’s used equipment website, found 326 X9 combines on dealer lots, including 1000 and 1100 models. The low asking price was $369,000, for a 2021 X9 1000 in Nebraska, with 1,134 hours and 742 separator hours. The high price was $999,999, for a 2022 X9 1000 in Ohio, with 506 hours and 321 separator hours
Tractorhouse. Com listed auction sales results for 43 X9 1000 and 1100 combines, with an average hammer price of $467,988. The high sale price was $637,000 for a 2022 X9 1100 in Iowa, with 265 hours and 210 separator hours. The low price was $284,070 for a 2021 X9 1100 in Missouri, with 1,850 hours and 1,242 separator hours
Looking Ahead
Campbell compared today’s Class 10 combines to Class 8 combines several years ago
“Historically, Class 8 combines were considered ‘too big, ’ but now they’re all over the place, ” he said. “There was an oversupply last year, but it’s being managed, and recently, Class 8 combine values have slowed their descent. ”
Koch advised farmers to acknowledge that life is cyclical and that it’s preferable to be proactive rather than reactive
“Educate yourself about the market and be sincere, ” he added. The value of something is vastly different from what it was worth 18 or 24 months ago. ”
Campbell predicts price erosion to continue into 2025, because most dealerships are still working through an abundance of combines on their lots
“If an operation can take on a combine of this size, there’s an opportunity there, ” he said. “The market is looking for farmers who can step in to fill that demand void — not a giant farmer, but a bigger farmer who can absorb these machines
“What we don’t know is how many of those farmers are actually out there. It’s a finite group of people. ”