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Economist: Farm equipment sales slump for 25th straight month
An economist with Creighton University says he’s concerned about the continued slump in the ag equipment market.
Ernie Goss tells Brownfield the farm equipment index recently sank below growth neutral for the 25th straight month in the Rural Mainstreet Index.
“Farmers loathe to buy equipment. When the outlook is not that strong, they pull back on their purchases.”
He says demand for new equipment continues to decline.
“We are seeing now a lot of buying of used equipment, and then a lot of repairs and maintenance on the current equipment.”
But Goss says the Federal Reserve’s recent outlook to cut interest rates could help the situation.
“Prime interest rate is now down to 7.25%. I expect the Fed to reduce interest rates again on October 28th and 29th. That would bring the prime interest rate down to 7%. That helps out on the net cost of agricultural equipment.”
Goss says the equipment index has faced pressures from high input costs, tighter credit conditions, low farm commodity prices, and market volatility from tariffs.
INTERVIEW: Ernie Goss
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