Fewer Farmers Buying at Annual Ag Equipment Show

Missouri corn and soybean farmer Danny Bradshaw talks about the falling prices of crops and what lies ahead at the Farm Progress Show in Decatur, Ill., Wednesday, Sept. 2, 2009. (AP Photo/Seth Perlman)

(AP)

Danny Bradshaw climbed out of the cab of a New Holland tractor Wednesday morning impressed but already certain he wouldn't spend the more than $200,000 all that horsepower and high-gloss blue paint would cost.

Corn and soybean prices have fallen from record highs, and the U.S. Department of Agriculture predicted last week that farmers' income will drop 38 percent this year. Bradshaw, like many farmers, is being cautious.

"I bought things back when prices were up a little bit," said Bradshaw, who farms at Holcomb in the Missouri boot heel. "Right now, we're just probably holding on."

Even with drops in crop prices and the recession, sales of tractors, combines and other farm equipment in North America have been relatively strong, helping manufacturers like New Holland and Deere and Co. weather sharp drops in sales overseas. Exports of American-made farm equipment fell 20 percent during the first six months of the year, the USDA reported.

But now farmers in the U.S., already uneasy with their finances, also may be scaling back. Deere and Co. last month projected its equipment sales, farm and otherwise, would be down 21 percent this year.

Many who wandered the annual Farm Progress Show this week said they're more interested in looking than buying. The trade show held alternately in Illinois and Iowa draws tens of thousands of people.

Farm equipment makers had been riding their customers' highs for several years.

Corn and soybean farmers in particular took advantage of record crop prices to replace old machinery and move into new, more efficient tractors and combines that routinely cost $150,000 and more.

Even now, sales of combines in North America are up 30 percent over a year ago, according to July figures from the Association of Equipment Manufacturers, a trade group for farm and construction machinery makers. Even tractor sales, which were down 17.8 percent in July from a year earlier, remain relatively good after having dropped from all-time highs, said Charlie O'Brien, a vice president with the association.