Planters plant seed of economic hope

Job losses are making national, state, and local headlines on a daily basis. Not all is doom and gloom on the job front, however. A recent tour of the John Deere Seeding Division plant in Moline, Ill., revealed business is still brisk. At that plant, located in the heart of John Deere operations, some 700 employees are working about ten hours a day, six days a week to meet planter demand. The added plus for the company, those planters are all sold to farmers, so they must be assembled before the spring planting season. Planters range from those destined to plant cotton, corn, soybeans, and even sugar beets. Planter size varies greatly, as well . . . from 4-row planters all the way up to those with 32 rows.

For many farm equipment manufacturers, business is still bustling as companies work to fill last years orders following a few years of extremely favorable crop prices. However, reports indicate that future sales are uncertain due to recent fluctuations in crop prices and concerns about the overall economy.

Farm tractor sales down nearly 10% for the year

The Association of Equipment Manufacturers (AEM) releases monthly flash reports detailing retail sales for farm tractors and self-propelled combines. They use data from most, but not all, manufacturers from each category. While their report does not specifically link purchases to dairy farms, it’s not hard to look at this graph and notice a trend for 2008 (see graph from AEM below). According to retail sales trends the last five years, peak sales occur in spring during planting and see their year low in November after harvest. Then, year-end buying picks up during the month of December to end the year a little higher.

While 2008 did follow this traditional pattern; its sales were down throughout the year and ended much lower in December. Even though farms reported record profits in 2007, a decrease in sales by 20% in the month of November is something easily noticed. The biggest loser in this category were the <40 HP tractors down 26.3%. Year-to-date sales posted a 10% decline for all farm tractors.

Those year-to-date totals did include a few gainers however. Sales of 4WD farm tractors actually increased by 5.8% in December and by 21% for the year. Yet their tiny volume compared to other tractors did little for monthly and yearly averages. Self-propelled combines gained too. Year-to-date, self-propelled combine sales increased 3.5% in December and 19.1% for the year.