Steffes Group


Farm Industry Market Trends Update

ringmen examining items


Farm Industry Market Trends Update

June 2021


It’s a seller's market 

Taking part in land, farm machinery, trucks and transportation, and construction equipment auctions, we have never seen such strength in the market across the board. From Sydney, Montana to Forrest City, Arkansas, seller’s expectations have continued to be exceeded by very strong buyer demand. In my 30+ years of being in the auction business, I have never seen such a widespread strength in all of agriculture. Row crops, livestock, and specialty crops have all had a positive net profit in the past year as well as great income potential due to the strength of the commodity markets.  


Still a strong demand for farmland 

Farmland all over the Midwest continues to find new highs. With tight land supplies and potential buyers exiting other investments, farmland has and always will be seen as a hedge to potential inflation. It is hard to believe inflation is quite low today, but if we see even a small rise in inflation farmland will be an excellent investment.  

Would this be what Bill Gates was thinking when purchasing all this farmland over the past 12 months? Gates is now the largest landowner of farmland in the United States. There has been almost 20 percent less land for sale this quarter of 2021 than seen in the previous year.  

In Iowa specifically, we have seen a price of $18,800 an acre on a single tract of 200 acres. The bidders were primarily farmers. When adding in the potential of a capital gains increase, commodity prices on the rise, and eliminating the stepped-up basis, I see no softening in the market through the end of 2021. Current corn and soybean prices have also been a factor in good attitudes and positive buying. Today as I write this, grain cash markets in the Midwest are currently: 

Harwood, ND Corn: $6.56 Soybeans: $13.76 

Finley, ND Corn:  $6.55 Soybeans: $13.75 

Burlington, IA Corn: $6.76 Soybeans: $14.59

St. Louis, MO Corn: $7.08 Soybeans: $14.87

As crops go into the ground at a rapid pace, all eyes will now go to crop condition reports and drought monitor condition maps. As we see the dry conditions in the western parts of North and South Dakota grow, it will be interesting to see how that will also affect the markets in the next few months.  


Farm equipment values continue to find new highs 

As we go through spring, we continue to find new highs in low-houred, well-maintained equipment. Although this is nothing new, we are seeing exceptional strength in the mid-90's to early 2000’s tractors, trucks, and current season equipment. Farmers have also seen a large influx of stimulus dollars that have given an unexpected opportunity to update equipment. This spring has been extremely exciting to reach new highs on used equipment we have not seen. In some cases, these highs haven’t been seen in over a decade. 


Construction equipment is also on the rise 

The construction world, with an emphasis on larger equipment, didn’t really see a slow down through Covid-19 and continued to work through it all. This, in combination with trillions of dollars of stimulus money being pumped into the economy, has not slowed the demand for construction. The largest challenge to buying new is the supply chain constrictions of retail. This has pushed the used market to very strong prices through the spring buying season. I am confident if we see supply issues in the retail world of yellow iron, we will continue to see strong demand in the auction ring. 


What auction attendance looks like post-Covid vaccine 

As we moved through spring, our live auction crowds gained in attendance and strength. Our last Live Sportsman’s event on May 1st had the largest attendance of the year with almost 1000 people in the crowd. I have heard so many comments on how good it was to be out and see people again.  

Although we are doing as many online-only auctions as we have ever done, we completely leave it to up the seller to decide if they prefer a live or online event. Ironically, as our live crowd is increasing, so is our online attendance. In the 1st quarter of this year, we had our 100,000th bidder register on our online bidding platform. We hear over and over the appreciation for the ease of the registration and bidding process. Due to Covid, there are people bidding on our website who stated they would never bid online. Those same people now prefer to bid online because it is so much more efficient. In fact, the largest number of people signing up to bid are age 55 and older.  


Steffes Group has completed over 200 auctions for 2021 

As I write this, I am being told we have completed our 200th auction for the year and there are more auctions booked for this fall than we had one year ago. I believe we are headed for a busy fall with the number of auctions we have on the schedule, coupled with very strong demand. This is a perfect scenario for a seller.  

To have an auction, it is important to plan ahead to get the date that works best for you as a seller, as well as to achieve the strongest prices of the season. It is not too early to call your local office to reserve your date.  


From all of us at Steffes Group, we wish you a very safe and prosperous summer. Thank you so much for your support.  


Tim Meyer 

Site Leader | Mt. Pleasant, IA 

Steffes Group, Inc.