How Utility Tractor Values Differ by Region

Values Of Utility Tractors By Region

Utility tractors have seen some of the biggest increases in auction values this past year and their usage is ubiquitous across the varied terrain of the US.  In this post we will investigate how these utility tractor values differ depending on the region. Location may not be the top determinant of equipment values, but it does matter. This was a follow-up question from our last webinar. “How does this [analysis] apply to my dealership in the mountain west?” We answered that question in a video post here. This week’s webinar will broaden the scope to also look at how row crop tractors and the John Deere S670 is valued differently across states.

The flat, open land of the grain belt naturally sets a ceiling for most ag equipment used in corn, soybean and wheat geographies. Larger tractors, combines, and other grain equipment will typically bring higher values with a substantially higher volume sold. The graph below depicts the region average price difference of utility tractors (100 – 174 HP) sold in 2019 and 2020. This analysis utilized Iron Comp’s filtering options to arrive at two comparable data sets. Below are tractors with less than 5,000 hours, and sold at auction for more than $10,000 between January and August.

Utility Tractor Values by Region

What we see first are the value peaks representing the Midwest. All other regions’ were 14% lower than the Midwest in 2020 and 23% lower in 2021. This increased discrepancy is not surprising when you consider what is driving the demand in the Midwest. The 2020 and 2021 bullish grain market.

Values Of Utility Tractors By Region

So how much have regional utility tractor rates increased from early 2020 to 2021? You could break out the calculator with the graph figures above, or you can let us do the math below.

Iron Comps Change in Utility Tractor Values by Region YOY
Similar to the demand logic about the Midwest, other regions with high demand of utility tractors should also see higher year over year increases. The Northeast’s heavy use of utility tractors in dairy country are a good example. The New England region has a 38% year over year increase in value.

In this data set there were fewer comparables from the Rockies and Pacific states with the applied month and sale price filters. When this happens the average should receive less weight in your valuation model. A more direct look at comparables may be more beneficial. Iron Comps has recently added in a search by state function. Check out the Auction Results screenshot below. This allows for faster sorting and locating of the best comps. 

Iron Comps Auction Results: Search By State Utility Case IH

If you are interested in learning more about how utility tractor values differ by region (and combine and row crop tractors too!), tune into the webinar tomorrow!

Used Combine Values in 2021

2021 Case IH combine values

2021 Case IH Combines Values on Iron Comps

Are you looking to buy or price a used combine before the 2021 harvest? You and everyone else (and you better hurry)! The prices have jumped with the supply of all used equipment tightening, but not equally for all types of harvesters. This is where used combine values in 2021 have differed from used tractor values. In this Iron Comps Insights, the Tractor Zoom data for combine auction sales is broken down over the past four years to better understand the trend that is driving 2021 used combine costs.

If you prefer an in-depth guided tour of this set of Iron Comps data, the video below walks through how different auction markets are behaving for combine sales that have taken place between the months of January and August. This segmentation allows a comparison of 2021 sales with the prior years without the typical end of year spike in December throwing off the numbers.

The biggest takeaways from the video are directional.  The values in the middle of the 2021 used combine market have shifted up. Harvesters with 1,000 – 2,000 separator hours are now worth considerably more than they were a year ago. In the following graphs, the past four years are averaged out for this same set of months. This provides a clearer picture of what is happening to harvesters in the ranges of 0-750, 1K-2K, and 2K-3K separator hours.

Used Combine Values With Less Than 750 Separator Hours

Considering all the hype that used equipment values have received this year, one would expect low-hour, late-model combines to be leading that surge. Not the case. They are up over last year, but not to the extent that newer tractor values have risen.   We saw this in the video too. 2020 was a phenominal summer for combine sales, so the bar was set high. This year there just has not been the available volume of those premium machines, which may be driving farmers in need of a combine to look at ones with slightly higher hours.

Iron Comps' Combine Values with Separator Hours less than 750 in 2021
Iron Comps’ Combine Values with Separator Hours less than 750 in 2021

Used Combine Values With 1,000 – 2,000 Separator Hours

2021 appears to be the year for mid-hour combine sales.  With low availability at the lower hours combined with an extremely profitable crop in the field, farmers have justified bidding higher to make sure they are prepared for this fall.

Iron Comps' Combine Values with Separator Hours Between 1,000 - 2,000 in 2021
Iron Comps’ Combine Values with Separator Hours Between 1,000 – 2,000 in 2021

This $11,000 jump in value over a year ago equates to almost a 14% rise in value.  A significant driver of this increase is availability of combines. In our Tractor Zoom data, there have been 17% fewer combines sold in this range this year compared to last. This is despite the fact we’ve added 50% more auctioneers already this year, covering over 75% of the US auction market!

Part of this rise may also be level setting. You can see that values in 2018 and 2019 were a little closer to this year’s current average prices. A good reminder that valleys and peaks do not last forever.

Used Combine Values With 2,000 – 3,000 Separator Hours

In this final look, we increase the usage to include between 2,000 to 3,000 separator hours.

Iron Comps' Combine Values with Separator Hours Between 2,000 - 3,000 in 2021
Iron Comps’ Combine Values with Separator Hours Between 2,000 – 3,000 in 2021

The year over year average combine value increases $6,000. Approximately the same annual rate, 16%, as the previous graph. Unlike the previous hour segment though, the supply for 2,000 – 3,000 sep hour combines is closer to what we saw in 2020.

What Are Combine Values Going This December?

This is the big crystal ball question, right? With a few variables out there, like actual verse USDA projected yields, it is impossible to tell for certain. Yet, we can look historically to see what has happened before. 2019 was a tough, but relatively consistent harvest season. In that year the average used auction price of combines between 1,000 – 2,000 sep hours increased 13% in December (over the January to August values shown above). In 2020, that rise was 23%! Remember that commodity prices started to take off in September, so it was anything but consistent.  Whatever this fall brings, if you are looking to purchase, or find the the value of a combine, be sure to check Iron Comps. The most recent comparable sale in a turbulent market can be the difference between gaining or losing 5% of the value right out of the gate!

2021 Used Tractor Values

The farm equipment market is crazy, especially these 2021  used tractors values. Stories of empty dealer lots and long lead times for new equipment abound.  Used equipment supply is also tight.  This has been causing prices to soar, but not equally across all categories. This is especially true in 2021 for tractors and combines, which we broke down in our post last month. In this Tractor Zoom analysis we lift up the hood on a couple different tractor horsepower categories.  Continue reading to see how the demand has been affecting the auction values. 

Utility & Loader Tractor Values

We start our analysis with smaller farm tractors ranging between 40 to 99 horsepower. This utility tractor may not be the strongest on the farm, but it typically gets the grunt work done. In resale values, this category gets to flex it’s muscle with the strongest year over year auction value increase of any other horsepower tractor category.  Data summarized below includes 40-99 HP tractors sold at auction for greater than $1K. June ’21 average sale price was over $12K. This is 45% above June ’20, and almost 100% higher than June ’19. 

2021 40 - 99 Horsepower Tractor Values
Iron Comps Average Monthly Values for 40 – 99 Horsepower Tractors

Row Crop Tractor Values

When looking at 2021 used tractor values, you cannot ignore the highly sought-after row crop tractor. Front wheel drive tractors sold at auction with more than 175 HP comprise this category. In a break from the smaller tractor trend, used row crop tractor average auction values are closer to flat year over year. The exception to this trend was seen in February when a number of low-hour machines were brought to market. This scenario is a great depiction of how desirable row crop tractors with few hours actually are. In January the average machine hours were 5K, followed by only 3.6K in February, and then back to 5.6K in March. The corresponding average auction values for those three months were $80K, $120K, then $83K.

2021 Average Used Values of 175+ HP MFWD, Row Crop, Tractors
Iron Comps Average Monthly Values of 175+ Horsepower Front Wheel Drive Tractors

 

The significant trend that the average prices or hours do not show is the shrinking supply of low-hour engines.  Tractor Zoom is continually adding new auction partners to our community. This historically has almost always resulted in a growing database of equipment from month to month. Tractor Zoom’s coverage of the US ag auction market continues to expand, currently covering over 70% of all US farm auctions. Yet, for the first time ever, our monthly supply of row crop tractors has been lower year over year for two consecutive months.

Iron Comps Row Crop Tractor Auction Volume From 2019 To 2021
Iron Comps Row Crop Tractor Auction Volume From 2019 To 2021

Evaluating Future Values

Used tractor values still have time to surprise us in 2021. The biggest indicators will likely fall in August and December. If farmers need a new tractor for harvest, they will pay top dollar. At almost $6 corn, you cannot risk leaving that crop in the field. In December most farmers will likely have more revenue from grain than they’ve had in some time. Purchasing new equipment will help offset some of this newly found cash.  Perhaps even paying a bit more for that low-hour tractor at auction?  If you are interested in gaining access to fast and accurate used equipment values, reach out here and we’ll be happy to jump on a call. 

Used Combine Values and What the Recent AHW Dealer Auction Can Teach Us

Used combine values are a big concern for many this year.  This is especially true going into the high demand August market with a tight supply of farm equipment. Just last week we saw a significant sale with Sullivan’s AHW dealer auction on June 15th. The listing was heavy with harvesting combines, draper heads, plus a few late model tractors and sprayers. This auction provides a great look at the market’s direction when analyzed with our Iron Comps database.

With over 60 lots of AHW’s equipment sold, we chose just a few significant pieces to test against the current trendline. Used combine values may be the most intriguing for dealers to look at now so they can gauge what the market may look like in August during prime selling season. For those interested in tractors, headers, and self-propelled sprayers, I’ll be diving into those in some upcoming analysis. The good mix of both Hagie and Case make for a nice brand comparison of sprayers!

Case-IH 2377

Harvester sales at this Sullivan auction ranged from $61,000 for a 15 year old Case-IH 2377, to a 2018 John Deere S780 2WD valued at $288,000. In addition to studying these bookends, a 2017 S680 4WD was analyzed. It has relatively low hours and some bells and whistles worth looking at.

The 15 year old Case 2377 may temper an overly bullish outlook on this market. With just over 2,000K separator hours, this would have justified $55,000 based on the Separator Hours vs Price graph which trends 2019 and 2020 values shown below.

Case IH 2377 Used Combine Values
Iron Comps Values Case IH 2377 Combines

10% above expectation may seem bullish, but compare that to the most recent sale where a 3,000 sep hour model sold for $67,000. This reaffirms what we have been sharing about late 2020 and early 2021 sales. Most older machines are seeing a flat or modest single-digit year over year increase in expected values.

If you caught our 5 Trends for Equipment Dealers webinar last month, you will recall that used combine values had not yet seen the post-pandemic bump that tractors have been experiencing. Some of this delay may be due to the void of late-model machines on the market. This theory was tested with a relatively young 2018 John Deere S780 at the AHW auction, which brought the top combine value of $288,000. We will dive into that next.

John Deere S780

The entire auctioneers description for this S780 is as follows:

2018 John Deere S780 2wd combine, ProDrive trans., ContourMaster feederhouse w/CommandTouch 5 spd. drive & hyd. fore/aft, 28.5′ unload auger, PowerFold bin extension, chopper, PowerCast tailboard, Active Yield, 650/85R38 drive tires and duals, 750/65R26 steer tires, LED lights, premium cab, 10″ display w/AutoTrac, Turn Automation, Data Sync, Implement Guidance, In-Field Data Sharing, Machine Sync, RowSense & Section Control activations, 899 eng./640 sep. hours, SN 1H0S780SJJ0801614

Our Tractor Zoom database has a significant number of these S780 for a quality comparison. In the  bottom bar graph below you can see a slight year over year average price increase in the S780 values. Because of all the variables in play we need to look at closer comparables to truly judge market movement. In the top graph, the orange square represents where this AHW combine ranks in terms of separator hours and sale price.

John Deere S780 Used Combine Values
Iron Comps Values of John Deere S780 Combines

Our AHW S780 is on the top end of expected values for its hours when compared to the past three years. High, but certainly not an outlier. Below we drill down even further into a look at two specific comparables. The first screenshot of Iron Comps Auction Results surfaces the most recent sale dates and closest hours. This view indicates that used combine values may have hit a ceiling.

John Deere S780 Combines Sold In 2021 Between 500 And 700 Sep Hours

However this does not indicate the market is reversing by any stretch of the imagination. Below the next image narrows down the search to the two closest sep hour comparables. Both sold in the combine flurry that was last August of 2020.

John Deere S780 Combine Between 600 And 700 Seperator Hours
John Deere S780 Combine Between 600 And 700 Separator Hours

You can see how much values have risen in just a year. From $249,000 average last year to $288,000 for this auction. A 15% jump!

John Deere S680

We have explored the top and bottom of used combine values in this auction. Approximately a 15% to 10% increase is seen, respectively, over last year. Let’s open it up and see if a mid-hour combine falls somewhere in between. A 2017 John Deere S680 4WD sold for $186,000 with just over 1,000 separator hours. Below is the full auctioneers description:

2017 John Deere S680 4wd combine, ProDrive trans., ContourMaster feederhouse w/CommandTouch 5 spd. drive & hyd. fore/aft, 26′ unload auger, chopper, PowerCast tailboard, bin extension w/tip-ups, 520/Interactive Combine Adjust, ActiveYield, LED lights, premium cab, 1,445 eng./1,071 sep. hours, SN 1H0S680SPG0795113

Comparing our S680 with other 2021 sales, the value is in line with others in the TZ database. A great comparison, pictured below, sold in late March of 2021 at a consignment auction in Minnesota for $200,000.

John Deere S680 Comparable Value for $200,000
Iron Comps S680 Combine Values

While this comp does have a refrigerator, the other options are similar and reinforce the theory that 2021 values may have hit a top and stabilized for now.

Iron Comps has the ability to filter by hours and auction type. Using this we can slice data to consist of only S680’s between 900 – 1100 hours sold at dealer auctions. Contrasting these historic equipment values, this AHW combine’s sale price exceeds 2019 and 2020 values by about 30%.

Comparable John Deere S680 At Dealer Auctions Between 900 And 1100 Hours
Comparable John Deere S680 At Dealer Auctions Between 900 And 1100 Hours

Used Combine Values in 2021

Big movements in used equipment values tend to coincide directionally with significant commodity price changes. With the exception of wheat, current cooling of the corn and soybean markets may be tapping the brakes on the rising used equipment values we have been riding over the past eight months. Another major factor at play will be the necessary demand of combines prior to this fall. Will a tight new and late model supply force prices even higher? Will downward pressure of the grain markets have any effect?  To answer these questions keep your Iron Comps app open and your eyes on the most recent sales!