Supply and demand is alive and well in the U.S. agricultural economy. Harvest of U.S. crops has begun and brings with it a great expectation of a record yields. Like a huge seesaw, high demand for a commodity elevates the prices customers are willing to pay for that product and when there is an excess worldwide inventory, prices fall to meet the slowing demand.
Supply and demand is alive and well in the U.S. agricultural economy. Harvest of U.S. crops has begun and brings with it a great expectation of a record yields. Like a huge seesaw, high demand for a commodity elevates the prices customers are willing to pay for that product and when there is an excess worldwide inventory, prices fall to meet the slowing demand.
Each time that Farm Equipment surveys dealers used equipment continues to be among their biggest worries. The past effects of Section 179 Bonus Depreciation has filled dealer's lots with a large number of relatively new, low hour tractors, combines and other equipment and these units have had an effect upon the sale of new equipment.
Planting is completed and the crop is beginning to reach the point of showing what the harvest might look like and all eyes are on commodity prices. Some farmers were astute enough to hedge their production costs earlier when commodities were selling at acceptable levels.
For the largest categories of tractors and for combines the general economy certainly has an indirect effect upon sales activity at the dealerships. Rising commodity prices, a boon for farmers, ranchers and dealers, is reflected in an increased grocery bill for the consumer and is often accompanied by a resistance to paying the higher price for premium items.
Can U.S. farmers be profitable in 2016? The answer to that question could have a major impact on equipment sales to farmers and ranchers this year. As commodity prices continue to rise, it does appear that the fall harvest could generate a livable income for most farmers.
Shipments to dealers continue to outstrip our forecast, but field inventory levels continue to rise significantly (+5.9% in March alone) resulting in weak retail sales activities.
Under 40 horsepower tractors once again had significant shipments from the manufacturer to dealerships, but field inventory levels continue to climb in February 2016.
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There was plenty of technology on display at the World Dairy Expo in Madison, Wis., a few weeks ago. Farm Equipment editor Mike Lessiter caught up with Monarch Tractor’s John Issacson and got his take on the top 5 applications in autonomy right now.