Succession issues leads to growth in on-farm machinery sales

There has been a 50% increase in on-farm sales due to succession issues as the younger generation proves less enthusiastic to enter the farming industry
There has been a 50% increase in on-farm sales due to succession issues as the younger generation proves less enthusiastic to enter the farming industry

Growing demand for quality second-hand machinery in the UK and succession issues has led to a growth in total values for on-farm sales.

On-farm sales have grossed over £11m across 24 sales in 2018 as succession issues and higher values for machinery drive the market.

On-farm sales have been continually growing in popularity over the past five years, and 2018 has seen a tangible increase in those which have taken place due to the lack of succession in farming, according to auctioneers Cheffins.

As the average age of UK farmers has increased to 59, according to Defra, this year the auctioneer has seen 50 per cent of sales due to succession issues as the younger generation proves less enthusiastic to enter the farming industry.

Other sales have been the result of farmers selling or letting farms, entering into contract farming agreements or bringing forward retirement plans.

Stock levels for on-farm sales in 2018 were on a par with those in 2017, however values for individual items have increased.

As farmers look to use less kit across more acres, higher horsepower machines have been in demand across the UK and this has led to residual values growing year-on-year.

In addition, stronger commodity prices in 2018 has seen UK farmers enjoy higher spending power, allowing them to compete against dealers and the overseas trade.

Overseas buyers

This year has seen machinery from on-farm sales bought by purchasers as far afield as New Zealand and Northern Africa, alongside regular sales to Europe and Southern Ireland.

The number of on-farm sales is likely to increase in 2019, due to succession issues and early retirement plans, alongside the growth of contract farming arrangements.

In addition, Brexit negotiations and uncertainty around subsidies result in more farmers looking to change direction of the business and this could also increase the number of sales undertaken next year.

The two biggest sales of the year were in Lincolnshire and County Durham, on behalf of Rainthorpe Farms Ltd and Leslie Brown Contracting, which both grossed over £1m.

The most expensive item sold at an on-farm auction this year was the 2016 Case IH 580 Quadtrac with only 1,331 hours on the clock which achieved £222,360 at the Rainthorpe Farms Ltd sale.