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The U.S. ag equipment market has seen unprecedented volatility in the last few years. Since early 2020, equipment availability and price have been top concerns for growers and dealers alike. Now, as supply chain issues ease, interest rates have risen and become one of the industry’s key hurdles. With equipment inventory levels normalizing and pricing trends falling, how and why U.S. farmers purchase their equipment will be more important to understand than ever.

To explore this issue and craft a solid forecast for the next 3 years, Ag Equipment Intelligence commissioned a customized research report in mid 2023 on behalf of a significant client in which it gathered survey data and interviews from a variety of ag equipment industry sources. The findings cover the perspectives of farmers, dealers, manufacturers and auctioneers and provide a candid reading on the market’s current and future status.

Farmers and dealers were surveyed on how they currently use financing, including which financiers they work with as well as who they perceive to be the top players in the space. They gave 3-year forecasts on the state of their own financing as well as the entire industry’s. These survey respondents also left commentary on different areas of interest within their financing that shed light on key issues.

Exclusive one-on-one interviews were conducted to gain the manufacturer and auctioneer perspectives, which cover their current and future concerns and commentary on the state of ag equipment financing. They spoke not only on what their customers are doing but how the industry could better serve their financing needs.

Overall, the ag equipment industry is in the midst of a slight downturn, which will likely see farmers’ purchasing habits pull back as keeping older machines longer looks more attractive. The majority of farmers are not planning to increase the percentage of ag equipment they finance, and a quarter of them want to decrease that percentage. Interest rates seem to be one of the strongest negative influences based on their commentary.

A notable takeaway from the report is that the future of how growers own their equipment — purchasing, leasing, renting, etc. — is set to shift, though that will look different depending on the type of farmer. The report’s findings suggest rising equipment and maintenance costs along with farm consolidation could point to a stronger future position for leasing.

In uncovering the ag equipment industry’s financing sentiments, it became clear the future of how financing operates in the industry will be tied to many other long-standing trends. Ag equipment’s increasing technological abilities, rising input costs, changing crop prices, American politics and industry consolidation — among farmers, dealers and financiers — will all play a role in the future of ag equipment financing.