Cash is the main driver in upgrades

Cash critical in machinery decisions


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THE cost of money, rather than weather conditions, was the biggest driver in machinery sales and leasing, according to an industry analyst.

THE cost of money, rather than weather conditions, was the biggest driver in machinery sales and leasing, according to an industry analyst.

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NEW EQUIPMENT: It's cheaper to buy or lease new equipment than ever before.

NEW EQUIPMENT: It's cheaper to buy or lease new equipment than ever before.

Agriview’s Alan Kirsten told the Tractor and Machinery Association (TMA) Melbourne conference even during the millenium drought, primary producers were still buying and leasing new machinery.

He said the dairy crisis had similarly not dampened enthusiasm.

“Even sales of machinery into dairy areas, for example, haven’t fallen,” Mr Kirsten said.

“People can often move out of an older machine, into a slightly bigger machine, for less money today than what they were paying.

“That conserves cash.

“Most dairy guys live and die on cash, most people do, but dairy farmers have been through the hoops for quite a few years and the cash aspect is critical to them.”

He said some broad acre croppers were also holding on to old machinery, as there was no market for second hand equipment.

​”Some of it is being kept, some of it has gone to auction and some it is being sold privately,” he said.

“We don’t have a huge trade problem, there are not excessive numbers of combines, or balers or tractors, lying around.”

Dealers were not trading equipment, as much as they used to.

“They don’t want the really old machines any more.

“They are not going to have their yards full of old combines as they are not going to have the capital tied up, sitting there.

“It’s no different from what the car industry has been doing.”

He said some broadacre croppers were also keeping old machinery.

“They think the window for harvest is short, they have throw everything at it,” he said.

“When they had six weeks to harvest a crop, they could wait for the contractor. Sometimes they only have two or three weeks, so it’s best to keep that older machine.

“And when I say older machine, it could only have 1500 separated hours on it.”

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