Farmers aren’t the only ones looking at the skies and wondering about the lack of moisture. Farm equipment dealers also feel the impact that dry conditions can have on agricultural production.
While farmers and ranchers generally did very well in 2011, water continues to be the item of greatest concern, according to farm equipment dealers from around California.
“Right now we are so dry that the biggest thing is, and possibly always will be, the water situation,” says Tom Schneider of South Kern Machinery in Buttonwillow. “This is something we’ve heard before and will continue to hear, and my grandchildren will be saying the same thing. Water is the most valuable commodity that we have.”
Tom Sieper, division manager for Kubota Tractor Corp., in Lodi, agrees.
“As if the economy wasn’t enough to worry about, first December was dry and now January is starting out dry,” Sieper says. “Someone told me that it looks like the weather cycle is two months behind. I hope it’s true, which means January is our previous November and February and March will be when we get all our moisture.”
Strong Sales Continue
Not all farmers are holding back on equipment purchases, and dealers are reporting very strong sales in December. Bill Garton of Garton Tractor Inc., in Stockton, notes that “this past December was probably the busiest I have ever seen for all lines of equipment. I think 2012, if it matches 2011, will be a good accomplishment.
“When the farmers do well, we do well,” he says. “The markets that are good are the orchard markets and the vineyard markets. They are our core. The dairy business is important, too, but input costs of dairies are high. All across the board it has been good.”
Garton observes that agriculture frequently bucks the trend when it comes to the economy.
“When other parts of our economy are bad, agriculture can be good, and when agriculture is depressed, other parts can be good,” he says. “Some-times that is how history goes.”
Schneider notes that in his area of the southern San Joaquin Valley, equipment sales are strongest for permanent crops such as almonds and pistachios. He says sales of cotton equipment have lagged somewhat despite the increase in acreage in 2011. The reason, he explains, is that there was an abundance of cotton equipment that was sitting idle during the decline in planted acreage and that equipment was put back into production in 2011.
“Typically, farmers don’t spend money just to be spending money. They spend the money more out of the need to have the equipment,” he says.
A survey by Farm Equipment magazine indicates that equipment dealers nationwide are projecting a four percent growth in sales during 2012. Eight out of 11 regions – including the Pacific region with 12 percent – showed positive average monthly sales growth in November 2011.
The survey also indicates that factories are keeping production stable, with 78 percent reporting no change, 11 percent increasing production and 11 percent decreasing production.
The dealers in California stress that it is important for farmers who need equipment to think ahead and allow several months lead time when making equipment purchases, particularly for heavier tractors used in row crop farming.
Plan Around Shortages
Steven Kost, executive vice president of Far West Equipment Dealers, says inventories are low on certain categories of tractors, and farmers are finding they frequently have to wait a few months for delivery.
“With equipment that is in high demand, there are some shortages of equipment, and farmers are having to wait for the manufacturer to build it,” Kost says. “There could be delays of up to six months.
“So it is a case of farmers having to think ahead of what their needs are so they can be sure to get the equipment when they need it because they aren’t going to be able to get the equipment right now for a lot of models,” he adds.
One option for producers who may have a more pressing need for equipment is to purchase used equipment, including machines that have been returned to the dealers after leases have expired. Many of these machines have fewer than 100 hours of operation in them.
Steve Adler is associate editor of Ag Alert. He may be contacted at firstname.lastname@example.org.