New Normal, Same Advice: Plan Ahead if Buying Farm Equipment
April 17, 2024 Whether global supply chains — coldcocked by the COVID-19 pandemic and its lockdowns and exacerbated by the war between Russia and Ukraine — will ever return to normal is debatable. Problems still exist across the world, from shipping lane issues to increasing market regulations. Nonetheless, the supply chain situation here in the U.S. is on the upswing, according to four of the nation’s top farm equipment distributors.
Their customers can rest a little easier these days, they say, but should never approach an equipment purchase without a plan and respect for adequate lead time.
Remembering the Bad Times
The supply chain crisis reached its peak in 2021, according to Joseph Sutton, the Operations Manager with Sutton Agricultural Enterprises in Salinas, CA. “Key components had huge lead times, shipping prices had skyrocketed, and the entire supply chain was stressed,” he says.
More specific, the fall of 2021 still stands out today, adds Paul Licata, the Owner/President of BDi Machinery Sales in Macungie, PA. “As an importer, at that time the price increases for shipment were four times pre-pandemic,” he says.
Mechanical Transplanter, based in Holland, MI, handles about 75% of its fabrication in-house, according to Owner Dan Timmer. That “helped considerably,” he says, during the worst supply chain days in 2020 and ’21.
“The outsourcing we had to deal with was more of an issue of delivery and not manufacturing,” Timmer says. “We do order bearings, sprockets, and furrow openers from China. They were able to fulfill the orders, but container shipping was so backed up, sometimes our items sat on a dock for a couple of weeks, or sat outside the port of entry for four to six weeks, or could not get on a train from the West Coast. I really feel that freight side was worse than the manufacturing time.”
Current State
For Mechanical Transplanter, things are “back to normal,” Timmer says. “Actually, during the worst supply chain times, we were still able to get items out in just a couple of weeks, which surprised a lot of dealers and farmers,” he says.
In terms of component availability, the supply chain has normalized to pre-COVID levels, Sutton says.
Prices, however, are still an issue, according to Licata — “much higher than 2019, by about 50%,” which makes it “very challenging” for small businesses, he says. “When you’re in a business that operates from end to end on diesel fuel, especially logistics and farmers, the price of fuel impacts everyone and everything.”
Brookdale Farm Supplies in Hollis, NH, currently has no supply chain issues of note, Business Manager Trevor Hardy says. In fact, the pandemic, he adds, may have initiated better best practices.
“What COVID taught everyone with the international freight that was a problem two or three years ago was that inventory is not a bad thing,” Hardy says. “The American Society of Manufacturing for far too long has been driving low inventory numbers, more frequent turns, and just-in-time delivery. All of that is great and grand when you have a 100% cyclical operation. When you have a seasonal growing operation, distributors like me need to hold inventory and plan better execution. I think after COVID and the shipping problems, many suppliers are doing a bit better at buffering inventories and making sure they have material available.”
Grower Tips Moving Forward
To eliminate shipping headaches — the biggest struggle for Mechanical Transplanter — growers should buy equipment made in the U.S., Timmer says.
“Growers need to stay with something local. We had customers that struggled with getting parts from other companies in other countries during those tough COVID years. Growers that had our ‘Mechanical’ brand had no issues in getting parts from us,” Timmer says. “Also, growers just need to plan. When you have some down time, go through the equipment and make sure it is ready for the next season even if that next season is months away.”
Taking lead time into account is extremely important, Sutton says, particularly with farm equipment that is highly specialized to fit a grower’s specific growing practices, such as row spacing, wheel track centers, crop, soil type, organic, etc.
“Due to the high specialization of the equipment, there are rarely complete implements on the shelf that will perfectly fit the growers needs,” Sutton says. “There will almost always be a lead time.”
According to Licata, most customers have shifted their buying practices and have accepted that inventory is not available, it takes twice as long to get something, and it also costs twice as much.
“The vast majority of them have fully implemented mechanization with equipment and continue to invest and acquire new machines, decide to make the purchase, and commit,” Licata says. “They understand it isn’t eight to 10 weeks to get something — it’s six months. So they make the commitment and accept; they know the machine will come, and I’ll have it. They may not have it as quick or know exactly which one, but they know it’s coming. And we get it to them as soon as we’re able to.”
Hardy concludes: “The one thing the last five years taught many growers is that, if you’re planting vegetables in the spring, you should not expect to order all of your supplies, seed, and fertilizer two to three weeks ahead of time.”
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