In this episode of On the Record, brought to you by Weasler Engineering, Pinion's Marc Johnson shares an updated forecast for dealers revenues in 2024. The latest Purdue Ag Economy Barometer shows producer sentiment improved in the last month but indicates most farmers still say it's a bad time to invest in new equipment. And, dealers report used equipment inventories continue to build. In the Technology Corner, Noah Newman visits with the precision team from Eis Implement in Two Rivers, Wis.

For more than 70 years, Weasler has proudly led the industry in unsurpassed quality, reliability and service. We are a global leader in manufacturing and distribution of drive train systems and components for agricultural original equipment manufacturers around the world. Since 1951, our promise to our customers has remained the same: We will continually focus on our values, including expertise, quality, innovation and customer experience, to ensure that you have the best driveline products to meet the demands of your business and the market. Work with us and you’ll find we live our values. That's the Weasler Promise. Visit



Jump to a section or scroll for the full episode...

Ag Economy Lagging General Economy

During Ag Equipment Intellgence’s Executive Briefing Mid-Year Review on June 6, we checked in with Pinion’s Marc Johnson for an update on his forecast for the ag economy.

Johnson says since December, the general economy has grown faster than was expected. For example, the S&P is up 11%, NASDAQ is also up 11% and the Dow Jones is up 5%. The only thing not up, unfortunately, is corn prices. Back when Johnson presented for the Executive Briefing, corn prices were $4.66 and now they are down to $4.36.

The interest rate issue coming up, we've got a bunch of tax provisions expiring. None of that has changed. We've got a farm bill that has got a little bit of progress going since November, so that's a little bit good for you guys.

It doesn't have everything in it that everybody wants and it's got some stuff in it that some people don't want. So whether or not that passes in its current form, it's too early for me to even go through any of those details, I believe on that farm bill, I think it's a ways off. But some of the stuff we can't go through. Just another big thing that we've been talking about is, we've got 2030 that we're headed to as ag dealers, so there's a little bit of built up demand that's going to be swelling between now and 2030 with population change. And so just to kind of update that, we were heading towards a $10 billion or $11 billion person population. We're growing at about 82 million net a day and that hasn't changed. It hasn't gone up or down, it's still just growing a lot, so we're still kind of on pace for that.

So 2030 still looks like we're going to need about 30% more out of our existing crops than we've got now. So whether that's with higher prices, whether that's we got selling more equipment that gets more efficient and gets more yield out of the ground, whatever that is, we've got some work to do and I think that our farm equipment guys are at the right spot for that. 

Johnson adds that 2024 net cash farm income is expected to be $121 billion. That is down from $160 billion in 2023 and down from $202 billion back in 2022.

That one's actually been on the rise that it's 120 right now, saying that "We expect next year to be a little bit better than this year primarily because we think, we believe the Feds when they say we're going to decrease the interest rate that happens, we're going to be a lot more positive about the future."

So what does the Fed think? So I showed you this back in November. This is what's stirred a lot of the talk this Fed said, "Hey, we're looking for an interest down. We're looking for an inflation rate down in the 2% to 3% and if we get that, we're looking to have interest rates down to 3%." 

Based on all the different economic indicators, Johnson says Pinion’s outlook for dealers currently is for 2% growth, if we see an interest rate reduction. With some of the mainline OEMs predicting dealers will see 10-15% decreases, he warns dealers need to look hard at their forecasts and build in that decline to ensure they don’t run out of cash.

I don't anticipate that that's going to be below three either. So that's not good. Now that's a lot better than it was in '23 and '22, but it's still above three and until we get under three, we're probably not going to see an interest rate. That's what the Feds say.

Dealers on the Move

This week’s Dealers on the Move include Horizon Ag & Turf, Belkorp Ag and WCTractor.

Canadian John Deere dealers Agland and Martin Deerline announced plans to merge, forming Horizon Ag & Turf, effective July 31. The combined group will have 13 locations.

California John Deere dealer Belkorp Ag has acquired Thomason Tractor, for a total of 8 locations.

2024 Rural Lifestyle Dealer Dealership of the Year WCTractor has acquired Hammer Equipment’s 3 locations.

Precision Business on the Rise for Single Store Deere Dealer

I caught up with the precision ag team at single store John Deere dealer Eis Implement in Two Rivers, Wis. With busy season winding down a bit, precision ag manager Eric Hagenow and precision specialist Phil Davister reflected on how much business has grown over the last several years, and the type of precision equipment they’re dealing with the most.

Eric Hagenow, Precision Ag Manager, Eis Implement: “For us it’s always corn planters, getting fertilizer systems up and running. Sidedress units are big. We do some pull type sprayer work. A lot of it is just general steering, getting screens and receivers on track.”

Phil Davister, Precision Ag Specialist, Eis Implement: “It’s getting that first piece in their tractor, and then after that, the second and third take care of themselves. It’s hard overcoming that initial sticker shock on the price tag, but then once growers get into it and see it, they see the benefits and the phone calls come easier.”

Eric Hagenow, Precision Ag Manager, Eis Implement: “We always kid ourselves every year we think we’re going to run out of things to do, and it doesn’t happen. A lot of these older growers are grabbing onto this technology now. The things that John Deere is coming out with makes it a little more affordable. People are getting involved with it. We don’t run out of work; it just doesn’t happen.”

Eric helped launch the Eis precision department 10 years ago. It consists of 4 people, including an administrative person who helps take care of inventory and all the paperwork, which makes a huge difference because the precision specialists wear many hats from sales to parts to service.

Farmer Sentiment Improves, But Purchase Plans Still on Hold

Farmer sentiment improved in May following a sharp decline in April, according to Purdue’s Ag Economy Barometer. May’s reading of 108 was a 9 point improvement from April. Producers reported improvements in both the Current Conditions Index and Index of Future Expectations.

6-14-24 Slides_OTR6.jpg

Producers' plans for machinery purchases remained stable, but the majority still say their plans for equipment purchases are lower in the upcoming year compared to a year ago. The percentage of producers who said their plans were lower or higher both dropped compared to April.

6-14-24 Slides_OTR7.jpg

Rising interest rates continue to be the primary reason producers say it’s a bad time to make large investments at 44%, followed by the increasing price of farm machinery and new construction at 29%.

6-14-24 Slides_OTR8.jpg

As to reasons it is a good time to make large investments, 45% of producers who felt like it was a good time credited higher dealer inventories. Another 25% said it was due to strong cash flows.

Used Inventory Build Up

Used equipment inventories continue to put pressure on dealers’ bottom line. The latest Dealer Sentiments Report shows a net 11% of dealers says their used equipment inventory is too high compared to a net 7% the month prior.

One dealer says, “Dealers are becoming less willing to lose large sums of money on used equipment to hit market share.”

They continue saying, “The manufacturers need to come up with programs that help move equipment.”

6-14-24 Slides_OTR9.jpg

While dealers reported their overall used equipment inventories were up in the month, used combines and used high horsepower tractor inventories did see some improvement. A net 8% of dealers reported used combine inventories were too high vs. a net 29% who said the same the month before. For used high horsepower tractors a net 1% said their inventories were too high, down 23 points from the previous month.

During Deere’s 2nd quarter earnings call with analysts, Josh Beal, director of investor relations, said that while used combine inventories are up from decade lows, they remain below the highs seen in the last downturn. However, used high horsepower tractors have increased more rapidly, he says, and are skewing more predominately to later models. This is driving up the average value of the equipment, he says.

Beal says, this trend in used high horsepower tractors was a key factor in Deere’s decision to underproduce retail demand in North America.

Data Points: Dealers Forage Harvesters Sales Growth Forecast

This week’s Data Point is brought to you by The Dealership Minds Summit.

6-14-24 Slides_OTR10.jpg

The percentage of dealers forecasting sales growth of 2% or more in forage harvester sales for the year ahead improved from 2023, with 8.5% of dealers forecasting growth, according to the latest Dealer Business Outlook & Trends report. This percentage peaked in the last 5 years when just 13.7% of dealers were forecasting unit sales growth for 2021.

On the Record is now available as a podcast! We encourage you to subscribe in iTunes, the Google Play Store, Soundcloud, Stitcher Radio and TuneIn Radio. Or if you have another app you use for listening to podcasts, let us know and we’ll make an effort to get it listed there as well.

We’re interested in getting your feedback. Please feel free to send along any suggestions or story ideas. You can send comments to