Cheffins sells over £50m-worth of machinery across 41 auctions in 2018

Cheffins, the leading auctioneer for second-hand agricultural machinery and plant, has hosted 41 auctions in 2018, across the firm’s Cambridge Machinery Sales at Sutton, on-farm auctions and vintage sales, with over 35,000 lots offered throughout the year.

The East Anglian-based auctioneer hosted 24 on-farm auctions across the UK in 2018, with gross sales at over £11m. Total sales for the year are £1m higher than 2017, illustrating the value uplifts for good quality second-hand machinery.

Oliver Godfrey, Director, Cheffins says:

“The growth in total values for on-farm sales this year is partly due to obvious increase in demand for top quality, second-hand machinery throughout the UK. Sales have taken place across the width and breadth of the country including as far north as County Durham and south as far as Dorset. There has also been a series of successful sales in Yorkshire, Cheshire, Herefordshire, Lincolnshire and throughout the Eastern Counties.

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. As the average age of UK farmers has increased to 59, according to DEFRA, this year we have 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.

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. Alongside these were six sales which amounted to over £500,000 apiece. These two events really set the bar for on-farm auctions and are two of the largest dispersal sales to have taken place throughout the year.

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 very much in demand across the UK and this has led to residual values growing year-on-year. We have seen a consistent rise in contract farming arrangements which has increased the need for larger and more powerful machinery across the board. Illustrating this, the most expensive item sold at an on-farm auction this year was the 2016 Case IH 580 Quadtrac (similar to pictured) with only 1,331 hours on the clock which achieved £222,360 at the Rainthorpe Farms Ltd sale.

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. The Cheffins on-farm sales bring a global market place to each auction, with online bidding allowing those from overseas to compete with domestic trade. 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 could well result in more farmers looking to change direction of the business and this could also increase the number of sales undertaken next year. Selling everything on the farm from the biggest tractors and combines through to spanners, tyres and workshop equipment, we forecast that on-farm sales, large or small, will continue to be the method of choice for farmers across the UK to disperse of surplus items.”

 Second-hand machinery sales at Cheffins, based at Sutton near Ely, have seen gross values up by 2.5 per cent in comparison to 2017. Across the same number of lots, the sale ground has reported higher values across the board with the December sale total 25 per cent higher than in 2017. Similarly, the total amount of machinery sold in Q4 2018 topped circa £9m, is 32 per cent higher than the previous quarter.

Bill Pepper, Director, Cheffins Cambridge Machinery Sales comments:

“2018 has seen strong prices paid for quality second-hand machinery, with the December sale seeing the highest total achieved for the past five years and an enormous 25 per cent uplift on gross takings in comparison to the Decembers sale in 2017. This improvement in trade is due to a variety of factors. The number of lots offered was almost exactly the same as last year and this goes to show the growth in values for individual machines, whether these are for quality second-hand tractors, plant, agricultural machinery or horticultural equipment. Demand is out there for the best in class and this has been demonstrated by some of the prices paid, such as £55,000 for a 2016 Massey Ferguson 7724 (similar to pictured).

Another clear factor in the growth in values is Cheffins’ global buying base. This year has seen the return of Sudanese buyers. Having left the market five years ago following government importation bans, they are now back in force and have been paying some significant figures for the older model Massey Fergusons, especially the 165, 290 and 590 types. This year has also seen Southern Ireland top the overseas buyers league, closely followed by Spain and it is heartening to see Ireland return once again to becoming the largest export destination. Similarly, online bidding plays and every-increasing role and month-on-month, over the course of the year, we see more people signed up to bid on the service with thousands of items of machinery travelling from the Sutton sale ground throughout EMEA on a monthly basis.

John Deere models have continued to be the most popular make of tractors, with the highest amount of £87,000 paid by a German customer for a direct from farm 8310R Similarly, Massey Ferguson models pre-1990s are selling for strong prices to the developing world. Amongst the plant section, JCB 3CX’s and mid-sized tracked excavators  continue to be popular, with the majority of these machines being sold to Poland for its burgeoning construction industry.

The ever-looming shadow of Brexit has definitely been the talk of many of the monthly sales, however, the agricultural machinery business seems pretty robust and we have probably been one of the few industries to feel the positive effects of the Brexit vote. Weak pound and strong overseas currencies are still leading to overseas buyers making the most of the relative savings to be had. These purchasers are not concerned, at present, by the potential impact of Brexit and whilst there may be some minimal trade barriers to overcome these do not appear insurmountable. We expect values to continue to rise as the trade and end-user buyers look to pick up quality machines at a discount price when compared to new and for additional markets to open up in the New Year as savvy overseas purchasers make the most of our weakening currency.”