LOUISVILLE, Ky. — From land values to equipment values, prices soared in 2021. Equipment manufacturers had issues sourcing all the components to build new tractors, and that placed even higher demand on the used market. And with the outlook for higher net farm income in the United States, that meant used equipment values soared.

Gary Peterson, who is known as Machinery Pete, will hold a seminar at this year’s National Farm Machinery Show. He will provide attendees an update on the used machinery market, illustrating where it’s been and where it’s headed. His is one of 14 seminars at this year’s National Farm Machinery Show this month in Louisville.

Peterson says if there’s one thing 2021 taught him, it’s how lower supply and higher demand can come together to create an explosive equipment market.

 “What have I learned in 2021? I’ve learned it’s the hottest used tractor market I’ve seen,” Peterson said. Peterson says there are certain trends that aided the used equipment market, including trends in supplies.

“When it comes to farm equipment dealer used lots across the country, I’ve never seen them as tight as they are right now,” he said. “We’re just not used to that. It’s really having an effect.

“Another change I’ve noticed revolves around geography. It used to really matter where a piece of equipment sold, and it just doesn’t matter right now. If it’s in good condition, it doesn’t matter if it’s east, west, north or south, it’s bringing more money.

 “Another factor that’s played a big part is the growth of all this online bidding, online-only auctions since the start of the pandemic. This force is like a freight train that has really worked to drive the values higher.”

Peterson says it’s not just the equipment with lower hours bringing in record auction values. He says even the later model equipment with higher hours are also in high demand for buyers.

“To cite an example, from our December 2021 Machinery Pete monthly online auction we had a 2014 John Deere 8360R with 6,179 hours on it from the state of Washington that sold for $138,750. That’s the highest auction price ever on an 8360 with over 5,100 hours.”

He says another auction item that was mind-boggling included the sale of a 2015 John Deere 6190R with 1,965 hours. The tractor was Arkansas and sold for $133,000. He said it was an all-time record high auction price on a 6190R.

Peterson points out that a Dec. 9, 2021, retirement auction in Charleston, Illinois, produced the highest auction prices ever on a tractor ($538,000), combine ($476,000) and planter ($346,000). He also said that a 1992 John Deere 4960 with 4,056 hours sold for $97,000 on Dec. 4 at a farm auction in Payne, Ohio. The letter price was the highest on a 4960 in eight years, he said.

“It is in our collective ag DNA to look for the other shoe to drop,” he said. “Typically, things get rolling and then crash lower. Not this time. Why? Two reasons. First, the supply chain mess will not be fixed in 2022, which will adversely affect availability and pricing of new farm equipment. Second, farm equipment dealer used inventories are tight. Just like the supply chain issue, tighter dealer used lots won’t be fixed in short order.

 “I think 2022 will continue to see strong buyer demand for used equipment in good condition. At least that’s the way this Norwegian sees it.”

Peterson has been covering farm equipment auctions for various industry magazines for more than 20 years and did the same during six seasons of RFD’s “Machinery Show.” Now Peterson has his own show, which shares its title with his nickname: “Machinery Pete.”

Each episode features Peterson traveling to a farm machinery auction, where he meets some of the people who attend the sales. He also provides his analysis of current and historical trends in the used equipment market and answers viewer questions about what their equipment is worth in the Ask Machinery Pete segment.