The latest December 2024 Agriculture Market Report from Sandhills Global unveils striking trends in the agricultural equipment market, with inventory levels rising for several equipment categories and notable fluctuations in values. The report provides an in-depth look at used tractors, combines, sprayers, planters, and compact utility tractors in the U.S., highlighting month-over-month and year-over-year changes.
U.S. Used Tractors (100 Horsepower and Greater)
Despite a slight 1.46% month over month decrease in December, inventory levels in this category have been on an upward trajectory for six months, marking a 19.5% year over year increase.
- High-horsepower (300+ HP) tractors led the year-over-year inventory surge, up 29%, even as the 175-299 HP category posted a 2.21% month over month decline.
- Asking values dipped 1.5% month over month and have now fallen 8.05% year over year, with 175-299 HP tractors showing the largest year-over-year decline at 10.38%.
- Auction values remained steady, showing a 1.36% month over month increase, but have dropped 13.48% year over year. High-horsepower tractor auction values rose 2.55% month over month, while 175-299 HP tractors saw a steep 15.12% year over year decline.
- The EVI (Equipment Value Index) spread—a metric tracking the gap between asking and auction prices—dropped to 40%, nearing peak levels last observed in 2015.
U.S. Used Combines
Inventory levels for used combine harvesters edged 3.19% month over month higher, stabilizing, though they remained 2.76% lower year over year.
- Asking values rose modestly, up 2.09% month over month, but dropped 3.73% year over year, aligning with broader stability trends.
- Auction values followed a similar sideways pattern, increasing 4.6% month over month, though still down 9.16% year over year.
- The EVI spread continued its three-month decline, reaching 47%, aligning with historical peaks from 2015.
U.S. Used Sprayers
Inventory levels for sprayers reflected a 1.7% month over month decrease in December, yet the market remains in an upward trend that began five months ago, with levels up 19.48% year over year.
- Asking values experienced a slight 0.37% month over month rise, though they’ve declined 9.87% year over year.
- Auction values moved more significantly, rising 4.59% month over month but tumbling 17.88% year over year.
- The EVI spread dipped to 45%, staying below the high-water mark of 2015.
U.S. Used Planters
This market showed a sideways trend in December, with inventory levels falling 3.84% month over month and 5.26% year over year.
- Asking values declined 1.55% month over month and 8.88% year over year, while auction values showed a smaller 0.37% month over month decrease but a notable 17.3% year over year drop.
- The EVI spread, though falling to 61%, remains historically high.
U.S. Used Compact and Utility Tractors
Inventory levels in this market have been on a downward slope for eight consecutive months, recording 1.28% month over month and 25.17% year over year decreases in December.
- The 40-99 HP tractor category saw the sharpest month-over-month decrease, down 1.73%, while less-than-40 HP tractors posted the largest year-over-year decline, plummeting 30.34%.
- Asking values fell 1.43% month over month and 6.83% year over year, with less-than-40 HP tractors showing the steepest drops at 1.64% month over month and 7.83% year over year.
- Auction values for less-than-40 HP tractors also led the declines, decreasing 2.07% month over month and 10.23% year over year. Overall, auction values fell more steeply than asking values, down 1.9% month over month and 8.71% year over year.
Key Takeaways
Sandhills Global’s December 2024 Agriculture Market Report highlights significant trends in the agricultural equipment market that can directly impact financing strategies. The continued rise in inventory levels across multiple equipment categories, paired with declining asking and auction values, presents both opportunities and challenges for lenders and lessors. With the EVI spread narrowing and certain segments, such as compact utility tractors, showing steep year-over-year declines in values, finance leaders should assess residual value risks and potential adjustments to loan structures. Additionally, understanding the nuances in high-horsepower tractor and combine markets can provide valuable insights for structuring competitive financing options that align with current market conditions. These data-driven insights are crucial for navigating the evolving dynamics of equipment financing in agriculture.
