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Demand for Farm Machinery Currently Outpacing Supply, But That Could Change – Lancaster Farming

Equipment on display Wednesday at Ag Progress Days. Dealers say new machinery shortages and price increases haven’t stifled demand. Many are preordering more than a year in advance to make sure they have inventory.
Alex Shock, territory business manager with John Deere, stands by a 35-foot combine head during Ag Progress Days on Tuesday. Heavy rain kept crowds at bay for part of the day, but plenty of people turned out after the event was postponed last year due to the pandemic.
Staff Reporter
Equipment on display Wednesday at Ag Progress Days. Dealers say new machinery shortages and price increases haven’t stifled demand. Many are preordering more than a year in advance to make sure they have inventory.
ROCK SPRINGS, Pa. — It didn’t take long for Mike Galbreath to spot at trend at Ag Progress Days.
When the three-day event opened on Tuesday, the New York and New England territory manager for H&S Manufacturing said many people who stopped by his booth were interested in rakes, hay mergers and bale wrappers.
“Mergers and putting forage in plastic are growing markets, and that was clear today,” he said.
But there’s another trend that Galbreath and many of the other equipment dealers and manufacturers have been dealing with long before the start of Ag Progress Days.
Shortages and price increases.
“I’ve been in this business for 20 years and no one has ever seen anything like this,” Galbreath said. “For this year, we ordered components ahead — steel, hydraulic lines, hydraulic motors — everything. Now we’re ordering again, and seeing delays and price increases.”
The cause of the shortages, according to several manufacturers, is increased demand for new machinery. Higher grain prices, among other factors, have compelled farmers to update machinery, while on the manufacturing side a lack of labor has made it challenging for companies to keep the flow of equipment reaching dealers.
And it doesn’t end there.
Brad Hershey, store manager for Hoober Inc., said the shortage of new equipment means farmers aren’t trading in much used machinery. With less used machinery on the market, the demand has spiked there as well, he said.
And so have the prices.
“It’s very difficult to evaluate used equipment right now. You have to give a premium for a trade or we don’t get it,” Hershey said, adding that the only other occurrence when demand spiked for both used and new pieces to this degree was before his time, during World War II.
“On the dealer side, it’s a big challenge to get machinery for inventory now,” he said.
But those challenges, and higher prices, haven’t dissuaded farmers from making purchases.
Hershey said precision ag equipment and a new model cornplanter made by CaseIH have been in high demand, and preorders for next year are flowing in at a steady pace. Planters were a big highlight at Ag Progress, he added, and more preorders were taken than ever.
“Manufacturers have asked us to order more than a year in advance, but we’re going farther than that,” Hershey said. “We have more equipment on order through 2022 than we ever have before.”
While finding components is a challenge, those manufacturers who source everything in the United States are faring better than overseas competitors, according to Ryan Skibo, sales manager for Pequea, which is based in New Holland, Pennsylvania.
Hay tools were a hot item at Ag Progress Days, he said, and production at the plant hasn’t let up.
“A lot of the machinery from overseas just isn’t coming in, or they can’t get components, even tires,” Skibo said. “But people are spending money to update and they want the tools to go faster and bigger.”
Alex Shock, territory business manager with John Deere, stands by a 35-foot combine head during Ag Progress Days on Tuesday. Heavy rain kept crowds at bay for part of the day, but plenty of people turned out after the event was postponed last year due to the pandemic.
Recent wet weather patterns have skyrocketed the sales of tedder and rotary rakes, he added, and some farmers are upgrading to six-star tedders just to cover more ground.
But even domestically-produced machinery isn’t without challenges in the supply chain.
Galbreath said H&S, which has manufacturing plants in Wisconsin and New York, was able to keep dealers supplied with inventory several months longer than competitors this year. But now items are starting to sell out, and H&S has expanded its production lines to try to keep up.
Like other manufacturers, Galbreath said a lack of labor has made expansion a challenging goal.
“We just had to implement another robot at the plant — our third one — because we can’t find anyone to work,” he said. “We keep building bigger to accommodate farmers wanting to grow.
“Right now, you can’t build enough to satisfy the demand.”
But Galbreath cautioned the demand could fall as quickly as it rose.
There’s a mentality among farmers that as soon as something is in short supply, they want it, he said. But if markets fall, farmers will have less to spend and the demand for updating to newer machinery will crash.
Dairy farmers are looking for machinery that will help boost forage production and feed quality as they seek to increase milk production, Galbreath said. But if milk prices fall to $12 per hundredweight, everything will come to a screeching halt.
“It can change so quickly. We’re seeing price increases on machinery and it’s not stopping demand, but if the milk price spirals, that demand will go right down,” he said.
U.S. Rep. Glenn Thompson, the top Republican on the House Agriculture Committee, told Ag Progress Days attendees yesterday that work is progressing on ag legislation.
Dean of Penn State’s College of Agricultural Sciences Rick Roush and state Secretary of Agriculture Russell Redding tackled a host of topics shaping the agriculture landscape in Pennsylvania, including climate change, labor shortages and African swine fever. 
The National Farmers Organization applauds the Biden administration’s Executive Order on Promoting Competition in the American Economy for bringing attention rising prices in the seed industry.
Homestead Nutrition opened the doors on its new location in New Holland, Pa., which will allow the livestock nutrition and agronomy company to consolidate its operations at one site.
Signs indicate new farming equipment will be hard to get in 2022 and prices will be up, but despite all this, demand remains strong.
Staff Reporter
Tom Venesky is a staff reporter for Lancaster Farming. He can be reached at [email protected]
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