2013 Farm Equipment Sales
January 21, 2014
Despite some lower commodity prices, last year was a very good year for farm equipment sales. Charlie O'Brien, senior vice president of the Association of Equipment Manufacturers Association, says sales in most categories went up, including nearly 10 per cent for both tractors and combines.
"Certainly living off the higher commodity prices that took place last year and the year before. And certainly that drove some cash into the marketplace. And from the farmer's perspective, pretty strong balance sheets overall"
Prices for corn and soybeans were lower than the previous year, but still pretty high. And he credits the tax deductions available for equipment purchases, and bonus depreciation allowance.
For this year, despite some danger signs, O'Brien is "cautiously optimistic."
"The offset is continue to look at the balance sheets - the debt to asset ratios are low - around 5%, and debt to equity around 13%. So from a balance sheet perspective, it's very positive right now"
The danger signs include weaker commodity prices, possible changes in the renewable fuel standard, and continued uncertainty over the farm bill.
The association has been tracking farm equipment sales since the early 1970's.