are new tractor over priced

[agri knives]

In 1975 most households would have only had one car, of much more basic specification than today, very few would have a passport let alone take a foreign holiday , eating out would have been a rare treat, and one TV in the front room with none of the plethora of electronic devices that are considered essential to modern living. Strip out all these additional costs of modern life and houses are much more affordable but no one wants to live like that.

30 years ago the average person spent 34% of their wages on food , today that’s down to only 11%. The big supermarkets and meat factory cartels have farmers squeezed into the ground . Into a situation where farmers are working harder and harder just to make a living. This has to change. What’s needed worldwide is a major cut in food production . A bit of hunger and they will pay more for food. When you hear people complaining about the price of food while holding a mobile phone costing a thousand euro then you know where their priority lies.

 

[jondear]

Just as a matter of interest has anyone with a 6000/7000 or 10 series Deere or similar machine 20 ish years old had one completely overhauled at say 10k hours to return it to as new condition and run it for another 19k hours.im guessing the lads would not want an old tractor that will do the job perfectly ok but prefer a new tractor with all the toys.
nick...

6910 !What a good tractor

 

[ollie989898]

A huge part of the whole imbalance is farm gate prices vs wages and machine costs etc.

We've been here before. Farming is no different to other industries involved in producing commodities. The barriers to entry in other parts of the world are not very problematic, meaning as the price of a commodity rises, more producers try to get into the game. You are thus indirectly competing with even a buy in Kazakhstan with a hand hoe or a poultry producer in Thailand. Twas ever thus, even if we didn't realise it. You are in a demand vs supply equation at the end of the day.

Wage inflation is an inescapable fact of life in a developed country and if you look back at historical wages these too were a lot lower so it's all relative. Money and machinery are cheap and as with all kinds of assets they are generally worth something when used, even if fully written off in ones accounts. Hence the popularity of massive and hugely sophisticated machines in many industries where the goal is output with the minimal requirement for labour.

I think part of the reason for threads like this is that farmers seem prepared to work 80 hours a week, often for fudge all money per hour if they stopped and worked it out, whereas in other industries there are real constraints on making people work that way, either for reasons of safety or accuracy/productivity in their work. Not to mention the fact that virtually any skilled worker in other industries will easily be earning £15/hour if not more; there is a thus a massive cost to consider if companies started having lots of people working that way that would soon be presenting itself in their accounts. In that scenario it is no mystery that companies adopt the same attitude illustrated by someone who has a 12 metre drill driven for 6 hours rather than a 6 metre drill driven for 12 hours.

If we want a more worthwhile discussion maybe it should be just what machinery people actually need.

 

[M-J-G]

We've been here before. Farming is no different to other industries involved in producing commodities. The barriers to entry in other parts of the world are not very problematic, meaning as the price of a commodity rises, more producers try to get into the game. You are thus indirectly competing with even a buy in Kazakhstan with a hand hoe or a poultry producer in Thailand. Twas ever thus, even if we didn't realise it. You are in a demand vs supply equation at the end of the day.

Wage inflation is an inescapable fact of life in a developed country and if you look back at historical wages these too were a lot lower so it's all relative. Money and machinery are cheap and as with all kinds of assets they are generally worth something when used, even if fully written off in ones accounts. Hence the popularity of massive and hugely sophisticated machines in many industries where the goal is output with the minimal requirement for labour.

I think part of the reason for threads like this is that farmers seem prepared to work 80 hours a week, often for fudge all money per hour if they stopped and worked it out, whereas in other industries there are real constraints on making people work that way, either for reasons of safety or accuracy/productivity in their work. Not to mention the fact that virtually any skilled worker in other industries will easily be earning £15/hour if not more; there is a thus a massive cost to consider if companies started having lots of people working that way that would soon be presenting itself in their accounts. In that scenario it is no mystery that companies adopt the same attitude illustrated by someone who has a 12 metre drill driven for 6 hours rather than a 6 metre drill driven for 12 hours.

If we want a more worthwhile discussion maybe it should be just what machinery people actually need.

If we dropped arable completely, that would cut our machinery by 2/3 or maybe more.

 

[ollie989898]

If we dropped arable completely, that would cut our machinery by 2/3 or maybe more.

I don't want to pry too much as it is your business not mine, but how much arable are in you involved with? On my travels I have seen a lot of folk who are involved in arable farming (in conjunction with other enterprises) and I struck me as a hell of a lot of hassle for not much reward. I know people want the straw/grain but knowing the true costs of arable as I do I did often wonder if it was not worth doing a deal with a big grower locally and coming to some sort of arrangement where they did the work and the host farmer got the straw and some rent back or something.

 

[le bon paysan]

I paid 25,000 euros for a Kubota 7040. 72 DIN .Air con, air seat ,clutch less shuttle , mechanical gear box , mechanical diff , the only electrics are the PTO and 4 wheel drive engage in December 2014. Lovely tractor, first brand new tractor I've ever bought. Put a new MX loader on it for 6000.
Its replacement today would cost 33,000. 6 years is extra 8000 or about a third.

 

[Lincsman]

Surely you don't load up the profit of two machines onto one. You half the factory\workforce as your not making so many machines.....

The cost of the labour in a tractor is very small and make little difference.

 

[M-J-G]

I don't want to pry too much as it is your business not mine, but how much arable are in you involved with? On my travels I have seen a lot of folk who are involved in arable farming (in conjunction with other enterprises) and I struck me as a hell of a lot of hassle for not much reward. I know people want the straw/grain but knowing the true costs of arable as I do I did often wonder if it was not worth doing a deal with a big grower locally and coming to some sort of arrangement where they did the work and the host farmer got the straw and some rent back or something.

Just 300 acres or arable and 250 acres of grass, we do most work ourselves, apart from spraying.
Without arable I could manage with a bike, 100hp tractor, a couple of older trailers, a cheap fert spreader and a topper.

There is a local AD plant being built and the arable ground would be better off put down to grass and let them cut it.
Less chemicals, less cultivation, less bother at harvest time and more healthy soil.

We can buy straw.

 

[ollie989898]

Just 300 acres or arable and 250 acres of grass, we do most work ourselves, apart from spraying.
Without arable I could manage with a bike, 100hp tractor, a couple of older trailers, a cheap fert spreader and a topper.

There is a local AD plant being built and the arable ground would be better off put down to grass and let them cut it.
Less chemicals, less cultivation, less bother at harvest time and more healthy soil.

We can buy straw.

You fit the exact kind of scenario I envisaged above. You obviously have a workable rotation that works for you but it involved a lot of work, risk and driving tractors. Also if you were relying on a contractor drilling, spraying and combining the stuff it is a lot of annual cost to absorb. A lot of people I know would also have no real long term grain storage on farm which then complicates matters.

In this scenario, telling a local arable farmer to rent the acreage off you and give you the straw back may achieve the same end results with less work. I came to the conclusion that people were doing it for reasons of pride, enjoyed driving tractors or enjoyed collecting machinery. Also they may have been justifying full time employed labour.

 

[Lowland1]

In 1975 most households would have only had one car, of much more basic specification than today, very few would have a passport let alone take a foreign holiday , eating out would have been a rare treat, and one TV in the front room with none of the plethora of electronic devices that are considered essential to modern living. Strip out all these additional costs of modern life and houses are much more affordable but no one wants to live like that.

In 1975 the average house price was £10,000 and a farm workers wage would have been £ 50 so 200 weeks work for a house today the average house price is close to £ 200,000 and the average wage won’t be much more than £400 so about 500 weeks work to buy a house. I know there are some variables like areas of the country etc but it seems we are all working harder for less. It’s time for a revolution.

 

[M-J-G]

You fit the exact kind of scenario I envisaged above. You obviously have a workable rotation that works for you but it involved a lot of work, risk and driving tractors. Also if you were relying on a contractor drilling, spraying and combining the stuff it is a lot of annual cost to absorb. A lot of people I know would also have no real long term grain storage on farm which then complicates matters.

In this scenario, telling a local arable farmer to rent the acreage off you and give you the straw back may achieve the same end results with less work. I came to the conclusion that people were doing it for reasons of pride, enjoyed driving tractors or enjoyed collecting machinery. Also they may have been justifying full time employed labour.

A lot of arable farmers are letting their own farms go down hill, so renting to them is a huge no no.
The wouldn't get ours if they cannot look after their own.
Grain storage is no problem.
A self employed guy helps when needed, they rest I can manage by myself in between livestock jobs.
Drill and combine are older but reliable and are well looked after.
Ploughing is the slowest job but we are mostly spring sowing, so I plough in Nov/Dec when things are quiet.
Harvest is a time when livestock jobs are quiet, so it fits in ok.

I'm happy enough with how things are overall, but machines sitting doing nothing for so much of the year annoy me.
Growing 3 year grass leys for an AD plant makes financial sense, as it cuts out most of the chemical and seed bill.

 

[Tealo]

The cost of the labour in a tractor is very small and make little difference.

Are you including all the office, r and d and hangers on in that. You get my original point, you wouldn't go and buy twice the combine you had and expect a customer to pay double.

 

[Greythundercloudys]

Yes, but everything we sell is under priced, fat cattle 2000,fat sheep 200, a ton of barley 200, that's what things need to be if a tractor is 130 grand.

 

[betweenthelines]

Yes, but everything we sell is under priced, fat cattle 2000,fat sheep 200, a ton of barley 200, that's what things need to be if a tractor is 130 grand.

But they're not and enough tractors are being sold at £130k to keep the manufacturers in profit.

Like I said earlier, if the tractors weren't being sold, prices would drop. Simples

 

[montys]

look we canot work with out one so we have no choice'the problem is not enougth compertion in tractor market

 

[kiwi pom]

look we canot work with out one so we have no choice'the problem is not enougth compertion in tractor market

There's loads of competition from cheap no frills stuff to top range Fendt's.

Everyone says there's no basic stuff but there is, its just no one orders it.

What do you actually need a tractor to do, I'm sure folks in the machinery section on here could come up with some cheaper solutions for you.

 

[Tubbylew]

Just as a matter of interest has anyone with a 6000/7000 or 10 series Deere or similar machine 20 ish years old had one completely overhauled at say 10k hours to return it to as new condition and run it for another 19k hours.im guessing the lads would not want an old tractor that will do the job perfectly ok but prefer a new tractor with all the toys.
nick...

I expect the price of parts and labour here would knacker it, all good if you can do it yourself though, i remember partly rebuilding a 6400 in a previous life and that cost 12k ish and it was still fairly rough tbh, so you'd be looking at a fair bit more, but it depends how much the tractor cost to start. @REStracTORATION would probably be more clued up tbh.

 

[Cluny]

In 1970 you could buy a new ih 414 for the price of 8 calves, now have to sell 80 calve to buy a 140hp tractor does a lot more work but does it do 10 times the work? Probably does but with a massive reduction in labour units.

Just a thought.

 

[Dave645]

You fit the exact kind of scenario I envisaged above. You obviously have a workable rotation that works for you but it involved a lot of work, risk and driving tractors. Also if you were relying on a contractor drilling, spraying and combining the stuff it is a lot of annual cost to absorb. A lot of people I know would also have no real long term grain storage on farm which then complicates matters.

In this scenario, telling a local arable farmer to rent the acreage off you and give you the straw back may achieve the same end results with less work. I came to the conclusion that people were doing it for reasons of pride, enjoyed driving tractors or enjoyed collecting machinery. Also they may have been justifying full time employed labour.

All very sensible advise, what your fighting is, the fingers in many pies, where that’s supposed to protect the farmer from the ups and downs of being in only one segment of farming.
I will also say, machinery prices is the biggest reason this model is not working long term, having all that equipment for all those different jobs mixed farms have, often ends in a lot of old equipment being used.
That said grass land equipment is not mega over priced, unlike tractors and cultivation equipment.
you can still get the equivalent to a PZ hay-bob for not silly money, Because Basically the design was locked in years ago, and it’s off license I think, as you can get them in many brands, again supply and demand keeping them cheap.

 

[Lincsman]

Are you including all the office, r and d and hangers on in that. You get my original point, you wouldn't go and buy twice the combine you had and expect a customer to pay double.

Most businesses do, potatoes go up, chip shop charges more to make the same profit... and more when potatoes drop.