Steffes Auction Group: Farm Assets Are Resisting COVID Impact
May 19, 2020
COVID-19 may be hurting many areas of the U.S. economy, but strong demand has continued for tractors, combines and other farm assets, according to a spring report from Steffes Group. During the first four months of 2020, the company conducted 170 auctions, all of which were successful.
"This was the first time in the 60 year history of our company we couldn't conduct live auctions. Yet, we performed and accomplished every event thanks to some trusting sellers, understanding buyers, and a great amount of technology," said President Scott Steffes in the report.
Fortunately, the company was well positioned to use online auctions exclusively during the "shelter in place" period, having conducted online-only auctions for 11 years.
Demand was strong for tractors, combines and sprayers throughout the period, regardless of the auction method.
"The market is discriminating. Well-maintained equipment with low hours commanded a strong premium," said Steffes. "We sold the highest priced tractor in the history of our company this spring, a late model John Deere RX."
Even older machines did well in many cases. "Most surprising was sharp rises in tractors 15 years and older, showing great care, good tires and a pedigree," said the report.
Land has been strong, but with some weak spots. "Buyers have shown up and sales have been impressive and yet we're starting to see, perhaps, a little chinking in what has been exceptionally strong armor. It probably reflects more of a hesitation in a consistently rising market and we've only seen it in areas where weather has greatly affected crop production. Premium land still commands premium prices in all our markets," said the report.
Land values continue to benefit from historically low interest rates, the report noted.