Uncategorized

Keystone Show Highlights Volatile Farm Machinery Market | Main Edition | lancasterfarming.com – Lancaster Farming

Preorders for tractors and other farm machinery continue to rise, and supply shortages coupled with increased demand have made ordering in advance a necessity.
Farm machinery lines the inside of a building at the Keystone Farm Show in York, Pa. After the pandemic put the farm machinery market in disarray the last two years, industry insiders believe the pattern of high demand and short supply will continue for 2022. 
Staff Reporter
Preorders for tractors and other farm machinery continue to rise, and supply shortages coupled with increased demand have made ordering in advance a necessity.
Last year, Jay Gainer made a prediction about the farm equipment business.
As the general manager for Messick’s, Gainer saw the equipment industry turn upside down as high demand clashed with inventory shortfalls caused by supply chain issues. With 44 years in the business, Gainer had seen nothing like it — and he didn’t want to witness it again.
“At the beginning of last year, I said we’d be done with this mess by the end of 2021,” he said. “Now, I’m saying it won’t be done until the end of 2022. Maybe.”
Gainer’s sentiment was shared by many of the vendors at the 2022 Keystone Farm Show, which opened on Jan. 4 at the York Fairgrounds. Once again, new equipment will be hard to get in 2022, prices will be up and despite it all, demand remains strong.
The scenario actually surfaced in 2020 when the COVID-19 pandemic began, and as it persists for a third consecutive year, Gainer believes things may change with the way equipment is sold in North America.
In Europe, he said, equipment dealers have very little inventory sitting on their lots. Instead, farmers order new equipment a year in advance, and the model is one that benefits manufacturers.
Farm machinery lines the inside of a building at the Keystone Farm Show in York, Pa. After the pandemic put the farm machinery market in disarray the last two years, industry insiders believe the pattern of high demand and short supply will continue for 2022. 
“It costs money to have all of this equipment sitting on a lot, so ordering a year in advance is good economics for manufacturers,” Gainer said. “But it’s not necessarily what farmers want because they want to buy when they’re ready.”
But as shortages continue to loom, farmers may not have any choice but to adopt the European way of purchasing equipment.
Michael Trazzera, sales support specialist with Hoober Inc., said several tractors and combines scheduled for production in 2023 have already sold, and preordering for other machinery remains up.
“If you are considering new, order it at least six months to a year in advance. Plan now,” Trazzera said.
Compounding the situation, he added, the rush to get machinery onto dealer lots as quickly as possible has overbooked haulers. As a result, manufacturers sometimes have to use different shipping companies, and machinery is getting damaged while in transit.
“There’s such a rush to get it out the door, and when it arrives with damages it pushes the order back,” Trazzera said.
Carl Zimmerman of Zimmerman Farm Service Inc. said preorders for tractors and skidloaders are higher than ever, but he isn’t committing entirely to the European method of having customers order everything in advance.
“People don’t want to wait a year for a new tractor,” Zimmerman said.
Rather than have customers preorder, Zimmerman said his business is ordering equipment in advance — those items they think will be in demand — in order to keep the sales lot full.
He admits it’s a risky move, but there’s not much of a choice.
“If we don’t order it and have it there, it’s going to be a while before we can get it when someone does want it,” he said. “You’re predicting what’s going to sell.”
The current market disarray isn’t impacting farm machinery only. Parts, tillage components and fencing supplies are also in short supply heading into 2022.
Austin Schoth, a salesman with Shoup Manufacturing, said plenty of people stopped by his booth looking for tillage parts, and he gives them all the same advice.
“If you know you’re going to need, or even could need the parts, buy them early,” Schoth said. “Anything with steel, it’s a major issue and it’s all behind schedule right now. A lot of the factories that shut down during the pandemic, they still haven’t caught up with the demand.”
The peak demand for fencing supplies is from mid-February through June, according to Bonita Whalen, product specialist with Kencove, and it’s been increasing drastically since the pandemic.
But with trucking issues combined with shortages, the rise in demand just puts more pressure on an already tenuous situation.
“High-tensile wire, wood posts, insulators — you just can’t get the product quick enough,” Whalen said. “It’s a supply chain, and when one link breaks it has a domino effect on everything else.”
If supplies are short and prices are up, what continues to fuel the demand?
Jesse Rohrer, territory manager for Kuhn North America, said strong commodity prices and a positive outlook for milk futures is keeping demand strong.
But there’s another factor at play.
“People see the shortages, and they’re afraid if something breaks down they won’t be able to replace it right away, so they’re buying it now,” Rohrer said.
Still, Zimmerman sees a reason to be hopeful for 2022 and beyond when it comes to the farm machinery market.
If the federal government doesn’t issue any more COVID-related stimulus payments, it will help level off the demand, he said. Plus, many equipment manufacturers have increased their workforce and output by now, so if demand does wane they’ll be well-positioned to catch up in a hurry.
“When demand drops, they’ll still be pumping it out on the manufacturer side of things,” Zimmerman said. “There’s some optimism for 2022 that things could straighten out at some point.”
Farm machinery suppliers at Ag Progress Days reported a booming market that’s short on supply and high in demand, but that could change quickly depending on several factors.  
CoBank shares its 2022 outlook report, which examines several key factors that will shape agriculture and market sectors that serve rural communities throughout the U.S.
Enterprise budgeting allows farmers to keep separate the income and expenses by enterprise or field, letting prioritize those enterprises that are returning the most profit to the farm’s bottom line.
A Syngenta rep says the company discusses supply chain challenges and ways farmers could replace glyphosate.
Messick’s recently hosted its annual open house in its new 200,000-square-foot facility on Strickler Road in Mount Joy, Pa. 
Staff Reporter
Tom Venesky is a staff reporter for Lancaster Farming. He can be reached at [email protected]
Success! An email has been sent to with a link to confirm list signup.
Error! There was an error processing your request.
Stay up-to-date with Lancaster Farming by signing up for our weekly re-cap newsletter. Didn’t have time to read the paper on Saturday? Here’s your chance to get the main stories delivered right to your inbox before the paper is on your doorstep.

source

Related posts

Ineffective bio-pesticides used in neighboring countries challenge locust prevention

Mthokozisi

Black innovators who reshaped American gardening, farming – The Associated Press – en Español

NIFA Invests Over $5M in Nanotechnology for Agriculture and Food Systems | National Institute of Food and Agriculture – National Institute of Food and Agriculture

Leave a Comment