Messick’s General Manager Jay Gainer made a prediction last year.
“At the beginning of last year, I said we’d be done with this mess by the end of 2021,” he recently told Tom Venesky at Lancaster (Pennsylvania) Farming. “Now, I’m saying it won’t be done until the end of 2022. Maybe.”
Gainer’s sentiments were shared by other vendors at the 2022 Keystone Farm Show: New equipment will be hard to get, prices will be up and demand will remain strong.
It might be time for North American equipment dealers, Gainer believes.
In Europe, dealers have little inventory sitting on lots. Instead, farmers order new equipment a year in advance, and the model has benefits for dealers and manufacturers.
“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.”
Messick's, in business since 1952, carries over 250 brands of equipment in the agricultural, construction, and lawn and garden industries including Case IH, New Holland, Miller Pro, Kubota, Woods, Apache, Newton Crouch, Cub Cadet, and Stihl. It has five locations in southeastern Pennsylvania.
But as shortages continue to loom, farmers may not have any choice but to adopt this European model.
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.
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.
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.
“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 he thinks will be in demand —to keep his sales lot full.
He admits it’s a risky move, but there’s not much of a choice.
Parts, tillage components and fencing supplies are also in short supply heading into 2022, Keystone Farm Show vendors reported.
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.”
If supplies are short and prices are up, what continues to fuel demand?
Jesse Rohrer, territory manager for Kuhn North America, said it’s strong commodity prices and a positive outlook for milk futures. 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.