Used kit trade buoyant despite strong sterling
By Tim Relf
SECOND-HAND machinery is feeling the effect of strong sterling.
But overall demand remains buoyant, according to auctioneers, as squeezed incomes in the arable and milk sectors focus farmers thoughts on buying used, rather than new, kit.
Cheffins Grain and Comins Bob Hall says it is for the more expensive items where the impact of currency is most evident. "Tractors – five years old and younger – which may be destined for mainland Europe, for example.
"But even in the middle and lower price brackets, for markets such as Spain or the Middle East, some effect is apparent."
The knock-on of this is being felt by farmers, some of whom are receiving less for machinery they sell to dealers. Brown and Cos Richard Godson reckons it is about the £10,000 level above which demand is currency-conscious.
Similarly, Savills Robert Hurst says tractors in the £12,000 to £20,000 range could be affected.
But the newer tractors might be bought by UK farmers anyway, he points out.
"And, though there are question-marks over the general election and possible interest rate rises, there are still cash and resources in farming," says Mr Hurst. "So the second-hand market remains strong."
Dreweatt Neates Simon Pallett agrees. "When incomes are squeezed, people look to buy second-hand. There is always a good market for well-maintained equipment, particularly where its background is known," he stresses. Such strong demand was evident at Southern Counties Auction-eers collective sale at Shaftesbury, Dorset, on Friday.
From there, auctioneer Simon Whaley reports a 75% clearance of the 1600 lots. Strong interest came from the Continent and Ireland.
Vendors have adjusted to currency movements by "pitching prices more realistically", says Mr Whaley. "A Ford 7810, for example, which last year would have made £10,000-12,000, is now making between £9000-£10,000." *
An unappreciated appreciation… Farmers selling tractors can expect to receive less money.