Shiny New Equipment Carries High Price Tag

Hoosier Perspectives

Where is equipment for mid-sized farmer?

Published on: February 20, 2012

Walking through acres of brand new, shiny equipment at the National Farm Machinery Show, noticing that the equipment carried the latest advancements in both design and technology, made me think what I would do if I was farming. I would fill my toolshed with tractors that steer themselves, combines that can control the grain cart via the combine operator and all sorts of GPS gadgets and gizmos.

It would be tempting to buy the biggest grain cart, buy the biggest bin and the biggest dryer so I could have insurance against wet falls for ever. And when it comes to planters, I would want the biggest, equipped with individual row shut-offs, no-till gadgets of all descriptions, the latest in monitors- the works.

There's just one problem. How would I pay for all this stuff? Especially farmers in the mid-size range, say 800 to 1,500 acres, are telling me it's becoming increasingly difficult to find new equipment small enough to make sense on their farm at a price they can afford. At least one major company has announced it will drop its smallest combine model in the near future, meaning the smallest machine out there of that color will carry an eight-row corn head or bigger to run efficiently.

If you build it, they will come. Obviously, farmers coming in to buy want bigger equipment. Companies wouldn't make big equipment if it didn't sell.

Even if I had enough acres to farm, probably some of it would be rented. How would I know I could hang on to enough land at cash rent prices to justify the equipment line-up I would buy? Cash rental rates went through the roof in some places this spring, yet ag economists claim they're just catching up with land values.

There in lies one problem. At a recent land sale in a rural county, on average land, two farmers were trying to combine bids to each get a tract of a 110-acre parcel, when a lady jumped up, slammed down her notebook, and yelled $1.4 million, some $150,000 above the existing total. Game, set, match- the sale was over. By the way, she's an investor with –plenty of money from an unknown source to invest.

Then there's little old me, just trying to survive, writing stories, which I love to do, helping raise a few 4-H club pigs, planting a few soybeans for a neighbor with a 30 year-old tractor and an 8-year old planter, raising a few sheep and volunteering to help local FFA and 4-H kids. The phone rings the other night and it's my insurance agent of some 26 years. She just wanted to give me a heads up that much to her dismay, her company was raising rates, and not just by a little, by more than 10%. And if you have a youthful driver, which I do, watch out!

Some of you have this figured out. If you can buy the shiny machines you saw, more power to you. Even if you can buy some of the cool technology to put in an existing machine, that will likely make you more efficient. If you've got the backing to buy land, or if your numbers that you run for budgets say you can offer more rent than other people, then so be it.

Me, I'm still trying to figure out how to get by supporting 4 kids, club pigs, registered sheep and farm toy habits, with prices going up around me every day for the things I need- insurance, phone service- electricity- medical insurance, drugs- you name it, it's going up.

I don't see the end in sight- if you do, let me know.

Meanwhile it was cool to walk through the national Farm Machinery Show and see what engineers and people with a creative, capitalistic spirit have created, whether I could ever afford any of it or not.

We can all still dream!