In this episode of On the Record, brought to you by Associated Equipment Distributors, we take a look at how dealers sales forecast compares to the major line OEMs. In the Technology Corner, Noah Newman shares a glimpse of Horsch’s new AgTech building in Cottage Grove, Minn. Also in this episode, Lindsay reports revenue growth in the third quarter and prices and inventory are trending downward for 100+ horsepower tractors.

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TRANSCRIPT

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Dealers Forecast 12% Decline for 2025 Sales  

Ag Equipment Intelligence’s latest Dealer Sentiments & Business Conditions survey shows dealers are forecasting 2025 sales to be down 12% year-over-year, unchanged from the month before.

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In the latest survey, a net 37% of dealers are forecasting sales declines this year, an improvement from 38% and 44% the previous two months. 

Generally speaking, dealers are less pessimistic in their outlook for sales declines than the OEMs. Deere is forecasting North American large ag unit sales to be down 30% in 2025 and small ag unit sales down 10-15%. AGCO and CNH are both expecting 2025 large ag sales to be down in the range of 25-30%.

One dealer in the corn belt commented that farmer sentiment remains depressed and customers are delaying having early order program conversations. 

Another dealer in the Mountain/Pacific region said, “General uncertainty persists and tariffs are not helping. Farmers are concerned they will start to incur tariff surcharges on equipment and parts. We have started to see some tariff surcharges from shortline manufacturers as well as some parts.”

Tracking Crop Prices 

As of June 25, corn prices were $4.10 down 28 cents from our last episode. Soybeans closed at $10.25, down 25 cents. And Wheat closed at $5.28, down 6 cents.

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Horsch Focused on Increasing Productivity & Solving Labor Challenges with New Equipment

Dealers, farmers and Horsch team members from across the globe gathered in Cottage Grove, Minn., June 18, for the grand opening of the company’s new AgTec building, dubbed “the new heart of Horsch in North America.”

Attendees also got their first look at the latest additions to the Horsch equipment line, including a new Leeb sprayer with advanced boom control, the largest air seeder cart on the market, a 90-foot planter with 350-bushel seed capacity and more.

We caught up with Lucas Horsch, CEO of Horsch North America during the event. He tells us the goal with this new equipment is to increase productivity and overcome labor challenges.

“In the ag industry, we are lacking more and more people. Not because we don’t have people, but we don’t have the right people sometimes in the location where we are. The theme we talked about today is productivity. Now we are moving into the 90-foot planter market and the big air seeder market with up to 900-bushel tanks. On the other side, we’re driving our sprayer business forward. When it comes to weed resistance, we need to work more on our quality of application. There are two pieces to it. One is to slow down our operation sometimes, maybe go to a wider boom, and to raise our volume to have better coverage. I’m not disagreeing that you can go with lower volumes when the conditions are right, but with the climate today, we don’t always have the perfect conditions. Sometimes you have a windy day, or it’s too dry that the fine droplets are drying up too quickly.”

Their goal is to double the Horsch U.S. dealer footprint within 3 years.

Lindsay Reports 25% Increase in 3Q Irrigation Revenues

Irrigation equipment manufacturer Lindsay reported its third quarter financial results on June 26. The company’s total revenues for the quarter ended May 31, were up 22% to $169.5 million.

Randy Wood, president and CEO of Lindsay, had this to say on the quarterly results:

“Continued strength in our international irrigation business, supported by ongoing project revenues in the MENA region, led to strong irrigation revenue growth for the quarter and a 22% increase in our overall revenues compared to last year."

“North America irrigation revenues were up slightly in the quarter, demonstrating resilience despite increased market uncertainty related to tariffs and potential disruption of U.S. grain exports. In Brazil, our sales volumes improved compared to the prior year as market conditions continue to show incremental signs of improvement. Infrastructure revenues were also higher than the prior year as we enter road construction season in North America."

Irrigation revenues were up 25% to $143.7 million. However, North American irrigation sales were only up 1% for the quarter to $69.1 million.

Used Equipment Update: 100+ Horsepower Tractor Inventory & Pricing Trending Down

Inventory levels of U.S. used tractors 100 horsepower and greater declined 2.5% month-over-month and 0.66% year-over-year in May, following a downward trend, according to SandHIlls Global’s May Market Reports. The used 100-174 horsepower tractor category had the largest impact on this market, with inventory falling 4.8% vs. the previous month and 9.59% year-over-year.

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Asking values were declined as well, down 1.88% month-over-month and 6.41% year-over-year  and are trending downward. The used high-horsepower tractor category — tractors with 300 horsepower and greater — showed both the largest month-over-month asking value decrease, at down 2.94%, and the largest year-over-year decrease, at down 6.63%.

Despite auction values falling 2.09% month-over-month and 4.1% year-over-year in May, they are on a sideways trend. Sandhills observed the largest month-over-month decrease in the used high-horsepower tractor category, down 3.21%, and the most significant year-over-year decrease in the used 175- to 299-horsepower tractor category, down 3.84%.

The EVI spread, which measures the percentage difference between asking and auction values, maintained at 38%, still slightly lower than peak values observed in 2015.

DataPoint: Commercial Farms’ Share of Total Farm Debt Grew 23 Percentage Points

This week’s DataPoint is brought to you by the Dealership Minds Summit. Early bird savings end June 18. To view the program and register visit DealershipMindsSummit.com.

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According to data from USDA and Economic Research Services (ERS), commercial farms consistently account for the largest portion of debt held by U.S. farms despite representing the smallest share of farms by number. Commercial farms’ high debt share reflects their reliance on financing for capital-intensive activities, such as investments in equipment, land, and essential technologies. Since 1996, their share of all farm debt has increased from less than half of total sector debt to 69% in 2023.

Meanwhile, debt shares for intermediate and residential farms have decreased. For residential farms, the share of debt initially rose from 18% of total sector debt in 1996 to a peak near 27% in 2003 before falling to 13% in 2023. Similarly, intermediate farms’ debt shares gradually dropped from 36% in 1996 to 18% in 2023. Changes in average debt levels per farm reflect the shift in debt shares by farm type. Among commercial farms, average debt levels have nearly doubled since 1996, while average debt levels for intermediate and residential farms have remained relatively flat after adjusting for inflation. 

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