The used equipment marketplace

In 1989, Greg Peterson was trying to determine a direction in life. A recent college graduate and newlywed, he was looking for a job in Rochester, Minnesota, when he received a call from his father, a third-generation John Deere dealer across the state in Benson.

He had a book titled “Auction Price Book,” written three years earlier by a banker from Morris, Minnesota, featuring auction prices on farm machinery. At that time, banks needed cash valuations for loans, and as a dealer, Peterson’s father valued the book not just for the prices it provided but to know more about what was on the market.
Peterson’s life was about to change—dramatically. As he glanced through the book, he realized that as an accountant, he could transform his love and skill with numbers into a business opportunity.

“I knew I liked numbers, and my Dad said, ‘This is good info, and I think there’s something here,’” says Peterson, better known now as ‘Machinery Pete.’ “Whenever I talk to young people, I tell them, ‘Listen to your folks, listen to your grandparents, because they’ve been through things.’”

Peterson was the keynote speaker at day two of the 2025 Southwest Agricultural Conference and offered a retrospective of his career and his outlook on used equipment sales and the factors affecting their rise and fall. He credited his father with giving him the Auction Price Book and starting him on what’s now a 35-year odyssey, tracking prices and monitoring the factors affecting used equipment sales. On that list are world influences, such as the increased Chinese construction in 2004 and the effect on the price of steel. In 2007, it was the rise in ethanol production, with an almost instantaneous increase in auction prices.

LESSONS FROM HISTORY

From 2007 to early 2013, commodity prices were strong, yet the period from the end of 2013 through 2015 saw the biggest drop in used farm equipment values he’s ever seen on late-model farm equipment.

“On my one to 10 scale, just for perspective, six is what I believe to be stable or normal, but you guys know there’s no normal in agriculture,” said Peterson. “From 2007 to 2013, we were up over high eights to nine, and then we started down. At the end of 2015, it was a key point when late-model used values for two-and-a-half years fell like a rock—15 to 25 per cent year-over-year, and then they started to level out to a more normal pace.”

He believes 2024 to be year one of a correction. He showed how prices fell in 2024, yet in the fourth quarter of every year— eight of the previous 22—Q4 used values have increased. In 2003, then-president George W. Bush instituted tax cuts that allowed growers to write off new or used equipment purchases.

“That became entrenched in the DNA of U.S. farmers,” said Peterson, referring to the practice of lowering taxable income through the purchase of equipment. “That’s why I always said that if I were having my retirement sale, I’d have it around December 8 because that’s when it tops out.”

THE DRIVERS?

There have been four factors causing a long-term trend in pricing. One is dealer consolidation; 10, 15, or 20 years ago, there were more dealers. Now, there are fewer, and they don’t have five stores; they have 35.

“These huge dealer groups want to do things differently than they did a decade ago,” said Peterson. “They don’t want this huge excess, and now they’re paying eight per cent interest on the 80 combines they have at their 30 stores. They couldn’t take that hit and had to move them, so they took them to auction, with big losses.”

The second factor is the increased price of new machinery. Larger-scale manufacturers are facing layoffs and plant closures in an effort to hold to a set price point to help dealers move excess used inventory. Third on the list is the shift resulting from the Covid-19 pandemic, when on-line bidding, which had been around for the previous 10 years, intensified and turned to on-line only auctions.

“You have to remember where commodity prices were in March 2020—they hadn’t gone up yet,” says Peterson. “The auction prices started to go up in mid-March 2020, and I thought there was no reason, yet they were going up. The only thing I could think of was the world we live in has us (on our phones) all the time, which is great—we built our company around that.”

Yet when it comes to buying equipment and everyone is online only, it dissolved peoples’ hesitation about clicking that bid button one more time. It also meant more interested buyers from across North America, not just the U.S. The other driver is the price of new equipment. Before 2020 and 2023, Peterson reasoned the price of new would increase by about four per cent, year-over-year. But coming through the pandemic, the effects of supply chain contraction, labour costs, and not being able to procure equipment, everything went out the window.

At the 2024 Commodity Classic, the newest John Deere tractor went for $1.2 million. Equipment has increased in size and price. In response to viewing a video that Peterson shot and posted on Machinery Pete, the most frequently asked question has been, “How much does it cost?”

It begs another question he posed recently: “Will we ever get to the point where pricing is too high?”

“Unfortunately, what I think we’re setting up for is a little bit of this continual ‘boom-bust,’ where manufacturers shut production when commodity prices are low, to help dealers move excess used,” said Peterson. “Then, for whatever reason, corn and soybeans go up, and you’re four or five years into the cycle, you need to replace your combine and planter, but so does everyone else. Then it takes a while to ramp up production, so you have to pay and have the planter or combine you need, and the price pressure tells you to pay it, and I think, unfortunately, that’s what we’re setting up for.” •