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2022 began with record-low used equipment inventories, according to a February report from Ag Equipment Intelligence. The publication says used agriculture equipment pricing was up 8% in January 2022, with increases noted in used row-crop tractor, utility tractor and combine pricing. Inventory, meanwhile, continues to remain low among dealers.
In the first few months of 2022, Mark Stock, co-founder of BigIron Auction Company, which hosts online used equipment auctions, has seen fewer pieces of agriculture equipment go onto the market and higher average revenue per piece of equipment sold as demand continues to outpace supply. In one instance, a mini excavator sold by BigIron about 6 years ago returned to auction this year with more hours on it, but fetched $6,700 more than the last time it sold.
In this episode of the Strip-Till Farmer podcast, brought to you by Terrasym by NewLeaf Symbiotics, Stock explains what to consider when deciding to sell your equipment, his advice for getting it ready for sale, insights on the current used ag equipment market and more.
The Strip-Till Farmer podcast series is brought to you by Terrasym.
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Full Transcript
Michaela Paukner:
I'm Michaela Paukner, associate editor of Strip-Till Farmer. Welcome to this episode of the Strip-Till Farmer podcast series. I encourage you to subscribe to this series wherever you get your podcasts. Subscribing allows you to receive an alert about new episodes when they're released. Thanks to Terrasym by NewLeaf Symbiotics for supporting this podcast series. Want to do more in 2022? Now available in convenient planter box application. Terrasym by NewLeaf Symbiotics is proven by Bex 2021 PFR to improve yield by 2.7 bushels per acre in soybeans, and 4.6 bushels per acre in corn. It also nets $20,000 more in incremental income with every 1000 acres planted. To calculate your ROI and purchase Terrasym for only $4.35 cents per acre, visit NewLeafSym.com/2022. That's NewLeafSym.com/2022.
Michaela Paukner:
According to a February report from Ag Equipment Intelligence, 2022 began with record low used equipment inventories. The publication says used agriculture equipment pricing was up 8% in January, 2022 with increases noted in used row crop tractor, utility tractor, and combine pricing. Inventory meanwhile continues to remain low among dealers.
Michaela Paukner:
In the first few months of 2022, Mark Stock, co-founder of Big Iron Auction Company, which hosts online used equipment auctions has also seen demand for used ag equipment outpacing supply. He says fewer pieces of agriculture equipment are going onto the market and those listed capture a higher average revenue per piece of equipment sold compared to 2021. In one instance, a mini excavator sold by Big Iron about six years ago, returned to auction this year with more hours on it, but it fetched $6,700 more than the last time it sold. In today's episode recorded at the 2022 national farm machinery show, Stock explains what to consider when deciding to sell your equipment, his advice for getting it ready for sale and additional insights on the current used ag equipment market.
Mark Stock:
Yeah, my name is Mark Stock and I'm one of co-founders of Big Iron Auction Company, formerly known as Stock Auction Company back in the early '80s, when my brother Ron and I started the auction business out of Nebraska, and then we evolved into selling machinery on the open outcry circuit, so to speak and covering multiple states. And then in 2001, we started broadcasting open outcry auctions in real time over the internet. So we were, I think the only auction company in that time using the internet in that regard on a mobile application. So we'd go to the farmer's place to have the retirement sales, and then we'd be broadcasting that signal to the tens of people at that time that were actually watching. And then that eventually evolved into a lot more people in 2006 and '07. I mean, we could see it was really getting a lot of traction pretty quickly.
Mark Stock:
And then in 2008, when the ethanol was introduced into agriculture, you seen corn prices go from $2.20 to $3.60. And farmers were really enjoying that opportunity for that additional revenue making money. So our retirement sale business, which was the big portion of our business dropped from three and a half auctions a week to three and a half auctions a month. So we said, geez, nobody wants to quit when they are making money, right? So we always had people call us up and say, "Well, I've got these four or five items I want to sell, and when's your next consignment sale going to be here in our community?" It's like, well, geez, you just can't put a sale together with four or five items. You have to put together a sizeable amount of machinery. I said, "Why don't we just try this timed internet thing?"
Mark Stock:
And we branded it big iron in 2009. So in February of 2009, that's when we had our first timed only auction that was branded Big Iron. And that just took off unbelievably fast. We started having little town hall informational meetings, and we rent the local community building that was packed full of people, all wanting to know how they can sell one or two or three pieces of machinery, because they were a little bit frustrated going to an implementing dealership and working out a trade and finding out that their thing was probably worth considerably more than what they were allowed for. Then they said, if we go in with cash, they thought they got a better deal.
Mark Stock:
So our business went from 21 items the very first sale, to 60 items the second sale, to over 200 items the third sale. And then we started doing twice a month instead of once a month. And then one month later we started doing it every week because it was just really gaining a lot of traction.
Mark Stock:
I think some of the secret to the sauce was that we did everything absolutely. So the people that put the equipment on the sale had to sell it. And even though it never happens, even if it brings a dollar you had to sell it, which we've been in this business long enough to know that doesn't happen. There's always somebody out there looking. There's enough people that are looking to buy something reasonably priced somewhere else. And if they can use it and flip it and make a buck, they're going to do that. So there's always the wholesale market out there. But once we started doing the absolute sale and not charging any buyer fees, because there started to be some other folks that were charging fees for a buyer to participated in online auction, our registrations were pretty quickly and people liked the fact that we always provided the owner's name, which was unheard of.
Mark Stock:
And in fact, we had people tell us all the time, "Well, they're just going to go around you. And the buyer's just going to go direct and buy it directly from that seller." And we said, "Well, yeah, we'll only do it once. We just won't do business with them again. So that's a decision that they have to make." And so far we've never had that happen all in years. Not one time, if anybody went around fast and sold it before it was sold.
Mark Stock:
And now we're fast forwarding how many years that is, 11 years in the space, more than that. But we've got over 300 reps across the United States. We sold 87,000 pieces of machinery in 2021. And an interesting part about it is the average piece of equipment travels 305 miles. So that means those items that are only moving 20 and 30 miles, your next door neighbor bidding on your stuff, look at the distance. Some of that stuff has to go to average 305 miles.
Mark Stock:
So there's a lot of equipment that sells in Utah that ends up in Florida and stuff that sells in West Virginia, that'll go out to Utah or Wyoming or Arizona and every place in between. And it's been fun, and we've got a tremendous team of outstanding people. And we like to help farmers and ranchers and business people and truck drivers and all those people have something they want to sell. We want to find that valued bidder. I mean, somebody that wants to buy it. So we want to bring ten people to the dance that all want that one item. And then just let competition through an absolute auction, an auction that nobody's gaming anybody, establish what that price is. Just let the free market do what the free market's supposed to do.
Michaela Paukner:
The amount of equipment you've been selling over the past 11 years has greatly increased. Have you seen any trends since you started to now?
Mark Stock:
Well, we've noticed that because of the internet and because of the availability for people to bid from our mobile apps, there really isn't a season anymore. Okay? So back in the day, when the open outcry business was going on, you have to have your sales in November, December, or January, February and March, because in April everybody started farming. And in October, everybody was harvesting. And those months in between everybody was pretty busy.
Mark Stock:
You had a little bit of a slow time in late July and August with the exception of those that were full scale irrigation farmers, then you could put on some sales during that time, but the rest of the time people had to be there in person. Otherwise, you weren't going to have a crowd big enough to get market value. But now because of the internet, there is not a bad time to sell anything anymore.
Mark Stock:
There are people that are looking all of over the country all the time. So when harvest is taking place in Texas for wheat, when they get done, if they're not part of the US Custom Harvesters Organization where they're moving north, and if they want to sell that combine in that wheat head, they put it on Big Iron because somebody in Kansas or Nebraska or sell Dakota, they're looking for a combine harvesting wheat. And it just flows like that.
Mark Stock:
We've noticed that there is no bad time to sell and there's no good time to sell. It's just sell whenever you feel the need, because the market is established because of the availability of what the internet brings to people. People will be in their tractor with the [inaudible 00:09:57] on planting corn, buying a piece of machinery that they can use a week from now, because they can do it then.
Michaela Paukner:
That's interesting. So now in the first two months of 2022, what has the used equipment market looked like?
Mark Stock:
Well, we've noticed that the number of pieces is a little bit less than last year in January and that's because nobody really wants to let loose of what they have until they get the replacement item. Okay? So that's our strategic move. But what we've noticed is the revenue that was generated in 2022 on less pieces actually higher on average per piece than it was in 2021. So we're seeing quite a bit of an increase in the value of everything being sold.
Mark Stock:
And that's because nobody can get anything new or if you get something new, there's 10 people wanting it. You have to have it ordered and paid for almost now to even get an order processed. It's tough getting supply products to assemble something to put together. Bearings, just try to find bearings. Try to find electronic components to put stuff together. It's a challenge. And I feel for all the OEMs, because they got people that want to buy that stuff and it's not really available because of COVID is really messed up supply chains.
Michaela Paukner:
So you said that equipment is getting a higher price per piece right now in 2022. Do you have some examples of what has sold and what those prices look like?
Mark Stock:
Yes I do. In fact, six years ago, we sold a mini excavator for a gentleman who was retiring and the gentleman that bought it used it in his little operation. Now he's retiring. That same piece, same serial number, more hours obviously sells for $6,700 more. And we've got other examples of similar machines, not maybe the exact same machine, but very similar machines that sold very well. We sold a 2014 grain trailer that the person bought brand new and he sold it on our year end December sale. And it brings $1,500 more than what he paid for it.
Mark Stock:
So he used that machine for all them years and he got rewarded at the end for that same time frame. And we're seeing the same thing, the sale that was just conducted in the middle of February. In fact, during the National Farm Machinery Show, John Deere 9460R tractor brings $176,000. And he had it appraised two years ago for doing a financial statement and they appraised it $109,000. So in two years, that's how much the price has increased.
Mark Stock:
And that is because of numerous things. Supply chain, number one. Number two, commodity prices are really, really good right now. $6 bean opportunities. New crop corn is $5.50, and old crop corn now is $6.50 in a lot of locations in ethanol plants, but there was people selling their new crop beans for over $14 for November delivery. And I know the inputs are up. That's just the way it works. But even if you calculate all the input costs, they're still pretty good profit margins for the good operators. And they've got money to spend, because the one thing they don't want to do is pay a lot of tax for some reason. That's the farmer's number one concern is, one, to make sure that the family's taking care of, but the number two is make sure they don't pay any more taxes they have to. And that's primarily because they're just frustrated with the way the government operates anymore.
Mark Stock:
I mean, I sit in coffee shops and talk to farmers all the time and they're happy to pay taxes if the deficit goes the right way, but it isn't. It keeps getting higher and high and higher. And the like the one farmer told me, says, "If went two years in a row without getting my banker paid up, they would've just shut me down. And I don't understand how it works now." That's why he doesn't want to have his sale yet because he doesn't want to pay the income taxes. He said, "Oh, I'm just feeding the monster." Those are his words. "I'm just feeding a monster."
Mark Stock:
That's a concern of a lot of the farmers all across the Midwest, and that's one of the reasons why they have been holding onto equipment and not selling. But now we're seeing a little bit of a shift because they figure, well, it's going up 30%, 35%. If I sell it, I'm going to end up with more money than I would've if I would've sold it two years ago, after I pay most of their recaption of their taxes or depreciation and such.
Michaela Paukner:
Okay. That was something I wanted to ask was, what would you say, I guess, to help them decide when the best time to sell is?
Mark Stock:
My advice to people when they ask is if you're wanting to retire, we know things are high right now. We don't know a year from now if things are going to get a little bit more back to normal. And if that happens, we'll probably see a shift where more equipment is coming off the factory lines, and then that's going to ease the supply chains. And then demand will be less for good quality used equipment, because they'll move more towards new.
Mark Stock:
We also know that interest rates may rise and they're claiming they're going to rise. And if they do that, usually has an impact on people's operations and their cash flows. And that might influence its value. We do know right now that in my almost 40 years of being in this space, I've never seen tractors and planters and combines and corn heads and sprayers and tiller [inaudible 00:16:13] and [inaudible 00:16:14] bring the same amount of money that it did when they bought it 5, 10 years ago. I've never seen it. I've never seen that.
Mark Stock:
A John Deere 4440, which is an iconic tractor, a good one $25,000 on an auction, an average one $20,000, below grade $16,000. Now the good one's $35,000 to $40,000, the average one's $30,000, the below grade's $25,000. Sooner or later, I bet that's going to come back to where it was three, four years ago.
Mark Stock:
So now my advice to anybody, that's got a piece of machinery they haven't used their operation for the last two years, for gosh sake, sell it. Use that money somewhere else in your operation. Inputs are high. Use it to pay for them high inputs because you still need fertilizer. Don't cheat on things that's going to restrict your yield because you're going to get $5.50 to $6 for your product. So sell something that you're not using and use that money to stop some interest, pay down your farm debts or buy inputs and use it in a positive way.
Michaela Paukner:
Good advice. What are some of the factors influencing your predictions for the rest of the year?
Mark Stock:
Well, number one is going to be commodity driven. Number two is going to be supply chain. Number three is going to be interest rates. Four is probably just overall farmer optimism. COVID has been ... I think people are coming out of that. The shock and awe. They're learning to live with it, so to speak. And so I think that will ... and as time goes, as all pandemics from everything I've read, it takes three or four years for that stuff to self immune itself, so to speak. So I think that will bring people going back to normal.
Mark Stock:
But if we continue to see ... the world trades great now. It's not, we're watching South America harvest right now and that's affecting the bean prices because they got a drought and that's running the prices up. And the price of your tractor, the price of your truck, the price of equipment is so directly related to the commodity prices. It's related to oil. It's related to the value of the US dollar, and just got to watch that stuff because those are your indicators.
Michaela Paukner:
Before we get back to the conversation, I'd like to thank our sponsor, Terrasym by NewLeaf Symbiotics for supporting the Strip-Till Farmer podcast series. Want to do more in 2022? Now available in convenient planter box application Terrasym by NewLeaf Symbiotics is proven by Bexs 2021 PFR to improve yield by 2.7 bushels per acre in soybeans and 4.6 bushels per acre in corn. It also nets $20,000 more on incremental income with every 1,000 acres planted. To calculate your ROI and purchase Terrasym for only $4.35 per acre visit NewLeafSym.com/2022, that NewLeafSym.com/2022. Now here's Mark Stock once again.
Michaela Paukner:
What is your long term outlook for the next like two years or so for the used equipment market?
Mark Stock:
As long as I've been in this business, there's people buying and selling all the time. And I don't think that'll ever change. When somebody buys something new there's always somebody waiting in the wings to buy that thing second hand, because that's just what they believe in. And then there's those that want to buy the third hand and the four hand piece. Your average farmer buys three to four items every year. Sometimes they're not the big high dollar ticket autos. Sometimes they're the auto, sometimes they're the Bush hog. Sometimes they're the grain cart. They're not always the combine and the tractor and the planter and the sprayer, but they usually have that worked into those trading cycles too. So maybe every third or fourth year, they get a new planter and every other year they get a different tractor, every other year they get a combine and we've seen that, that's been going on ever since they had the combustible engine.
Mark Stock:
Okay. So there'll always be something for sale and there'll always be somebody wanting to buy it. And that's why the auction industry is going to be here for a long, long time. And the online space is an adaptable thing that a lot of people jumped into even more so because of COVID because of social distancing. But the young generation, their communication style is with their phone and with their apps. And with the way they communicate through their Snapchats and TikToks and Instagrams and all that stuff. And old farts like me that look on a Facebook once a while, right? Everybody's dated by what media they're communicating with, but they'll always be stuff for sale. So my prediction is, if you need a good piece of machinery, buy it, take care of it. And when you're done with it, sell it. That's going to take care of you, as long as you took care of it.
Mark Stock:
If you buy something and you beat it when you're using it, it's going to beat you back when you sell it. That's all there is to it. You got to know what a grease gun is. You got to know what a power washer is. You got to do little scrubbing on it, get it cleaned up every now and then you got to change the oil. You got to some service work on it. If something breaks, you got to fix it. Barely more than a decade by just a temporary fraction. That's not something that you can rely on for recovering your value on. And they'll always be a market for good quality equipment. They'll always be a market for the non good quality equipment, because there's always those different layers of buyers.
Michaela Paukner:
If somebody's thinking about selling their equipment, isn't there ever a time when it's too old or too run down to sell it in auction?
Mark Stock:
That's a great question. And that's what our reps go out to look at. I mean, if they've got a 45 or 50 year old piece of machinery and it's an old [inaudible 00:22:25] that the bangs are all rusted up, you can't turn anything and it's been sitting in the trees for a long time and a half. The thing's been buried in six inches of dirt. You know, sometimes those things are just better off to haul to the iron pile, sometimes.
Mark Stock:
If you got a something that's got an engine and it's been around for a while and it's the motor stuck, we're talking old piece of equipment, sometimes those are better off going to the iron buyer. But there's also things that are collectible and that people need the parts. So reach out to one of the Big Iron reps and they'll go out and they'll take a look at it.
Mark Stock:
If they personally don't know what the value is because it's outside their wheelhouse. We have got a team of experts within the organization that will be able to advise that rep and that seller on the best mode of action to get them the best results. We want to partner with the sellers and the buyers. We want a long term relationship with these folks, because we want to be a part of their decision making process in this industry. And I don't think people look at an auction like they used to 30 and 40 years ago and it's like, "Oh my gosh, that's the last resort."
Mark Stock:
Back in the '60s and '70s, people used an auction when they were broke. People don't use it like that anymore. They use it as an honest way of trading equipment and using a platform of competitive bidding to establish a price. And that works well as long as you know how to market and advertise properly, putting an ad in your local paper, I'm sorry. You're going to be extremely disappointed because you've only got one person that wants it, so who's bid and gets it. So you've got to be larger than that. You have to think outside that box, you have to be a global company to be quite honest.
Mark Stock:
There was a John Deere 670 combine sold in December, got loaded up to go to Ukraine. The farmer just called me when the guy, the buyer picked up said he was going to Houston to get on a boat and was going to Ukraine. There was a John Deere 7720 combine, believe it or not, going to Argentina that just sold here two weeks ago. And so it's a global market out there. And remember, the second last bidder could have been your neighbor.
Mark Stock:
So you got to open up those avenues and those different channels so the trade market can be established as long as you do it right. And that's what we do at Big Iron, we have a tremendous marketing team. I mean, there's 20 some people in this thing, that's all they do is market. And then there's another 25 or 30 of them that just handle all of the titles and doing the lean searches and the payments and the processing and all that. There's a lot of people making sure that the transaction is a legitimate transaction.
Mark Stock:
We've got seven or eight people just in quality. They're watching everything that comes through our system. When the lots are submitted, if there's a picture missing, the reps got to go back out and get the right picture. So we've got to make sure that the buyer is fully informed of what's going on so they can make an educated decision. And we want them pleasantly surprised in a good way when they get it going, wow, that's even better than what I thought it was. We don't want them going, "My gosh. That's a lot worse than it was described." That's not good. That's not a feeling I want to be involved with as a buyer. So we just try to put ourselves in that buyer's position every time we're listing a piece of equipment to sell.
Michaela Paukner:
Okay. And what does it look like from the seller's perspective when they want to list a piece of machinery with you?
Mark Stock:
Well, the seller wants to expose it to the masses. 6.5 million people were on our website last year. The average sale day there's 75,000 to 100,000 that are watching the day of the auction. That's as the auction is going on. So they just, so then it looks like the seller is, hey, if I can expose it to that many people, true price discovery will be reached.
Mark Stock:
And they like the fact that when we publish their name, any buyer can give them a call and ask them questions, because you got a 95% of the population are honest, good people. That other 5% is an absolute pain in the rear. But you're not going to fix those people. Once we find out how they're wired, it's not doing business with them. And then we just want people who are honest and want a good handshake, so to speak with a transaction conscious. People, the sellers want to know who bought it. They want tell them everything about it. They want sleep well at night because we're a good, God thing country. And the majority of people don't want to pull the wool over anybody's eyes. And it works that way. So the seller likes that, because that's what the majority of the people in the US are about.
Michaela Paukner:
So what is the process like? Do they contact you? And then what happens after they decide to list it?
Mark Stock:
Our reps are local. Most of our reps, they have a trade area that the majority of them are less than an hour away from their edges of their trade area. So if the seller listening right now doesn't know who your rep is, you go to the Big Iron website, fill out the little form that says you have the equipment to sell. You put your name in your address and your phone in there. And then that information gets sent right over to that area rep, and then they contact you to get the wheels in motion.
Mark Stock:
But if you know who your rep is, it's probably somebody local. Just go to your local basketball game because your rep is probably there. Go to church somewhere and you're going to find your rep the coming out of church or else going into the local grocery store or in the cafe.
Mark Stock:
So the Big Iron footprint is really we're local, we're where you want us to be, and that is your next door neighbor. But once you make the decision that you have something to sell, the rep will come out and go over the Big Iron selling process. And it's usually a five week period minimum from the time the equipment is turned in.
Mark Stock:
The reason that period is five weeks is because that's what it takes in order to get those interested people over that time period notified that your item is selling, but the rep does take all the pictures. They'll shoot the video footage, which video is the fastest marketing media there is right now. And people on our traditional business when we would sell a retirement sale, the tractor might be idling there. Then we shut it off, but nobody would pull it ahead, drive it around and demonstrate it because you couldn't do that with a big crowd. But we videotaped that demonstration weeks in advance and that on the website for people to watch and monitor.
Mark Stock:
So, but the seller answers the questions during that time period, and depend on the video footage and the pictures are taken, a lot of the people's questions are answered just by looking at that anymore, but they still will call the seller and get that warm, fuzzy feeling. Can I leave it sit there for a week if I get it bought and such and such? So that goes on.
Mark Stock:
And then it sells on the given day to the highest bidder, and our system has extensions. It's called, some people call it a soft close. So somebody bids on an item when there's less than five minutes remaining, it auto starts another five minutes again on the big pieces. Then we have a three minutes auto start and a two minute based on the total dollars, so they don't last forever.
Mark Stock:
And then once the item is closed, then Big Iron collects the money from the buyer. And then we pay the seller. So it really is pushing the easy button, if you're a seller. You tell everybody the decision is the hardest part. Whether you want to sell one item, whether you want to sell 20 items, some people say no, the decision ain't hard. Especially the wives. They always say, yeah, I wanted that stuff sold a long time ago because he's got too much crap around the place. You hear that all the time. But the husband's usually attached. He remembers all about it. And they have a tough time getting over that. And well, I say, "Well, you got all these pieces. Why don't you keep the one that you really, really are most attached to and convert the rest of the cash and take the wife on a trip to Hawaii or something?"
Mark Stock:
She really likes that idea, because right when you make that statement that, the guy seller just looks at you embarrassed because he knows he's been hitting that in one ear for the last 25 years he's been married. But yeah, we take care of all that stuff and make it easy. We've got fabulous reps and they go through an extension training program because we know it's important to provide good quality, and they work with their district manager. So the reps got a district manager that helps assist and keep them up to speed. And we're scattered all across the country. We're ready to go to work. And we do a lot of it.
Michaela Paukner:
Yeah, it sounds like it.
Mark Stock:
A sale we got there in the middle of February, 1,700 items on one sale. In March, I think we'll probably have over 3,000 items on a two day sale the last week in March. The middle of March, I know there's some 2,200, 2,300 piece sales coming up. That's a lot of equipment, but it's scattered all over. So it's not all in one concentrated area. It's everywhere. And in between everywhere.
Michaela Paukner:
And then on the buyer side, once their bid is the winning bid.
Mark Stock:
Yeah. They have to pay for it.
Michaela Paukner:
Yeah. Obviously
Mark Stock:
They pay for it, and we don't charge a buyer's a penalty. Some people call it a buyer premium. No, that's not a premium. You're penalizing somebody for bidding, that's our take on it. We don't charge that. We've never charged that. Let the buyers compete on what the market value is. Not worry about how much they got to adjust their bid accordingly because they got to add a 10% fee onto it or something like that.
Mark Stock:
And the surveys we put out, we get an overwhelming response from the sellers telling us that's why they want to use us. They don't mind bearing the weight of the commission, knowing that the buyers don't have to pay for them to sell their equipment. But the buyer just pays for it. They get sent an invoice. It's marked paid, and then they can go pick it up.
Mark Stock:
The sellers instructed, and they have access to what's been paid, what's not been paid on their profile. So the seller can log in and you see that information instantaneously as it happens. So once it's paid for, they go do what they would do on a regular traditional open price sale, go whatever they need to go to pick it up and take possession of it.
Mark Stock:
Or they can work with one of our trucking partners. We have several of them, but one we use a lot is Hitchpin Logistics. So they'll take care of it for you as a buyer. They'll arrange it with the seller. They'll arrange it with the person driving the truck and they'll make sure you get started and hauled to your direction for whatever their fee structure is. And you just, they'll call it up and they'll walk you right through that as well.
Michaela Paukner:
Okay. Was there anything else you wanted to mention about the used equipment market right now?
Mark Stock:
The used equipment market's hot. We have a real estate division too, and that is extremely hot right now. Land is up almost in the same ratios as the machinery market's up, a good 30%, 35%. We're seeing in most of the country, and the majority of what we're selling in our farmland auction division right now is not being bought by farmers. It's being bought by investors who are renting it out.
Mark Stock:
So that money, that money is coming into the market right now. And nine of the last tracks that we have sold that were over a million dollar individual track purchases were all paid for in cash. Nobody borrowed any money. So that just tells you there's a pretty strong flex of people out there who are investing in farmland. We've also got a livestock division, so we're selling bulls and cows and registered animals, selling horses too.
Mark Stock:
So those auctions are now done online. They're all unreserved. And the sellers that have used them, most of these are 30, 40, 50, 60 year old family traditions of raising bulls and breeding heifers and [inaudible 00:34:23] calf heifers. And they love the fact that the Big Iron model expands their genetics to states beyond. It makes somebody feel good when they're in South Dakota and they sold a bull to somebody in Georgia, and it all happened because they put it on Big Iron.
Mark Stock:
We also have classic car, classic tractor division too, because what's the definition of a classic? Anything is 20 years old or older. So I'm definitely a classic. There's a lot of folks out there that have spent time during their winter months, taking a tractor and restoring it. And they use it in their operational a little bit, more so on parades.
Mark Stock:
But now that we're seeing our baby boomer population reach that certain age group, they're moving maybe off the farming into town and the wife usually says, "You can't take your tractor collection with you." So then we've been selling these tractor collections and it's phenomenal, absolutely phenomenal. The tenderness and the care and the amount of time that's been put into restoring a tractor, or just making the originalness of it really pop is phenomenal. And people will pay premiums to have those tractors in their collection. So the 4440s and the 4430s and the 4010s and the 4020s and the Greensides, you got the 1066s and the 1206s and the 1468s, those things are just ... 5480s are getting real popular. The 2+2 tractors, which most people laughed when they come out.
Mark Stock:
Now, if you got one, they bring good money, and people aren't buying them to use it, buying them to put into their little museum collections. Classic cars are phenomenal. We sold a '58 Chevy a couple months back for $77,000. That was restored. A lot of Corvettes. A lot of you name it, we've been selling it. On Big Iron we've got a big one coming up here in March, classic car sale. People just, they can't get enough of that stuff.
Mark Stock:
Classic pickups, the big 1972 Ford Highboy pickups or 1968 or '67 Chevy pickup, they just ring the bell. It goes back to though, if you've got something that you took care of, or you restored it, and you did it the right way, you'll be rewarded for what it sells for in today's market. And we don't charge a buyers premium. That is really, the companies that have been doing just those collector car, tractor and type auctions, they're historically known for charging these high buyer fees. And we don't do that. And buyers really like that.
Mark Stock:
Some people find a lot of excitement and energy, and if you want to pull up our website, if you logged in, you can have access to auction results. The truck market is really hot now. The 2000 model Peterbilt 379 13 speed with 1.4 million miles just sold for $67,500. Two years ago, that truck would've topped out at $35,000. We would sell that truck every day of the week for $33,000, $34,000, maybe $35,000. Now brings $67,000, almost double. And which is why the guy was selling it.
Mark Stock:
He says, "For what I can get out of my truck, I can get out of it for six months, not be in it, driving up and down the road and make the amount of money would take me six months to make just by selling it. So that's why they're doing it. The old saying, is when your ship comes in, you got to decide to get on it or not. Some people are getting on it. They're taking advantage of it. Of course, the crystal ball is fuzzy, my magic wand's always broke, but we know right now the market is super strong. We do not know when things change because that pendulum swings back awful fast and it usually goes over center, because then it takes a while to get into the middle.
Michaela Paukner:
Thanks to Mark Stock for today's conversation. Did he convince you to sell a piece of used equipment or consider buying equipment from an online auction? Share your thoughts with me by emailing MPaukner@LessiterMedia.com or calling (262) 777-2441. If you're looking for more podcasts about Strip-Till, visit StripTillFarmer.com/podcast, or check out our episode library wherever you get your podcasts. Finally, many thanks to Terrasym by NewLeaf Symbiotics for helping to make this Strip-Till podcast series possible. From all of us here at Strip-Till Farmer, I'm Michaela Paukner. Thanks for listening.
