Thursday, August 22, 2019

Brexit brings ‘golden touch’ for second-hand machinery

May 1, 2019 by  
Filed under Machinery

Sales of second-hand tractors and agricultural machinery by Cambridgeshire-based auctioneers Cheffins reached £12,642,000 in the first quarter of 2019, says the company.

Gross sales at the Cambridge Machinery Saleground hit £11m during the quarter at Sutton, near Ely – an increase of more than 11% compared with the same period in 2018. In addition, the sales team saw four farm-based auctions gross £2,642,000, with 1628 lots offered in total.

Stock levels at the saleground were up 31% in the quarter, compared to Q1 2018, as sellers sought to make the most of high prices achieved in the run up to Brexit. In March alone, Cheffins sold over £5m-worth of plant and machinery.

Buoyant sentiment

Cheffins director Bill Pepper said: “The numbers of entries for this quarter at both the Cheffins monthly sales and on site are indicative of sentiment in the second-hand machinery market as sellers look to cash-in on the high prices being achieved ahead of Brexit.

Mr Pepper added: “Brexit has brought with it a golden touch for second-hand machinery values over the past three years or so as overseas buyers looked to pick up bargains and make the most of our weakening currency.”

Uncertainty over import and export tariffs once the UK finally left the EU had encouraged sellers to cash-in quickly and disperse of machinery in early 2019 as the expected final Brexit deadline of 29 March loomed large, said Mr Pepper.

The result had been an uplift in stock levels. Prices had not grown throughout the first quarter in line with stock, indicating that lower value items dominated auctions. But sale rates had held firm as the buyer base continued to broaden.

Developing countries

This year has seen the return of buyers from developing countries – including Sudan and Afghanistan – following relaxation of import restrictions in their domestic markets. These buyers tend to pick up 1970s and 1980s tractors with values up to around £6,000.

Buyers from these countries tend to buy in bulk to meet demand back on their home turf. Similarly, the Middle Eastern market appeared to have picked up with strong sales to the region as political tensions begin to settle, said Mr Pepper.

Top buyers at the saleground were once again led by the Irish, followed by Spanish, Polish, Bulgarian and Romanian purchasers. The highest-grossing lot during the period was £85,000 for a 2013 John Deere 8310R, followed by £80,000 for a 2015 Fendt 939 Profi tractor.