Anyone in the market for new or used machinery will be in a much better position than they were a year ago, with prices coming back significantly and supply improving.
Pickles Auctions national sales manager for agriculture Clay Redmond, who is based in Mildura, Vic, said the prices for second-hand machinery had come back about 25 per cent from 12 months ago, with challenging seasonal conditions along the east coast a significant factor in the price drop.
"The next two weeks is going to determine what the market does for the next six months," he said.
"This time of year is really crunch time.
"Western Australia and South Australia have been a bit protected, but it's still on the edge, and many parts of NSW and Queensland are already drought affected."
Mr Redmond said recent 37-degree heat in Mildura had "really put the skids on things".
He said this was leading to an "across the board" reduction in machinery prices, with seasonal uncertainty affecting buying decisions.
"Some of the higher-end, six-figure machinery is feeling it the most because from a finance perspective, there's a lot of hesitancy with rising interest rates, and people aren't really sure whether we've reached the top of the hill or not," he said.
"That hesitancy has flowed through to other areas like trucks and earthmoving equipment, where we've seen clearance rates drop dramatically.
"It's not just the ag sector that's affected, everyone is feeling a bit of hesitancy about how they spend their money."
Mr Redmond said the industry was going through a "perfect storm" on the back of challenging seasonal conditions, increased machinery supply and higher interest rates.
But he said it was also important to remember the recent drops were off the back of historic highs.
"Through COVID we saw such dramatic increases, it's not as bad as it seems on the surface," he said.
Mr Redmond said while buyers with set cap-ex plans were still making purchases, it was more the "prospecting" type of purchaser who was out of the market.
"There's going to be opportunities for astute buyers to get a good deal and savings to be had on buying auctioned plant," he said.
Mr Redmond said there were concerns from dealerships about the level of stock carry-through.
"We do a lot of pricing of trades for dealers and that's sky-rocketed in the last two weeks," he said.
"They're not wanting to carry stock through and wanting to offload assets now."
Mr Redmond said he had messages for both buyers and sellers.
"If anyone has got something to sell now is the time, rather than waiting for the market to turn," he said.
"Buyers can take advantage while things are stagnant."
Mr Redmond said header sales were the only type of machinery bucking the downward price trend.
"This year is going to be a record for header sales," he said.
But Mr Redmond said this was on the back of supply improving.
"It's purely around the time line. They were probably ordered in January to June last year," he said.
"It was near impossible to get a new header through Covid. A lot of manufacturers are pushing headers in our direction now, so there's a lot more supply. It's really not to do with the current market, but coming off the back of that backlog."
ACM Agri Commercial Manager Marketplace Peter Gatti said with prices coming back off the record highs of the past two years, it presented an opportunity for machinery buyers.
"Buyers in the market for machinery can secure a good deal, with prices dropping and supply increasing," he said.
Paula Thompson
Paula Thompson is ACM's National Machinery and Ag Tech writer. She has been an agricultural journalist for more than 20 years. Prior to her current role, she was a reporter with the Stock Journal, covering livestock markets and the grains industry.
Paula Thompson is ACM's National Machinery and Ag Tech writer. She has been an agricultural journalist for more than 20 years. Prior to her current role, she was a reporter with the Stock Journal, covering livestock markets and the grains industry.
