Over Supply Of Used Farm Equipment Impacts Industry

I’m Susan Allen Leif Magnusson, President of CLAAS Global Sales Americas, and the 2016 Chair of the Association of Equipment Manufacturers spoke recently to agree-pulse on the oversupply of late model farm equipment

Magnusson : It has been a challenge I would say for high horsepower farming equipment, you talk big tractors, combines you talk self-propelled sprayers, you talk big planters. These categories have suffered a lot. I think it is fair to say that was an oversupply from 2010,11-2013, and these inventories were building up. Our dealers and the industry were putting values on this equipment that was probably right at the time, but as we saw commodity prices come down, new sales going down and there was a glut of used equipment out there, that very quickly devaluaed in price. So I think as an industry, whether it’s manufacturers or dealers there has been a tremendous effort in right-sizing this inventory. I think this is still an ongoing process, but one positive from all this is that we are starting to see the right values on used equipment.

Other positive analysts are projecting the turnaround will begin in 2017.