The cotton gin across the way from our office finally cranked up this week. In previous years, by this point in late September, the whole area was already a night-and-day, 24/7 beehive of activity, with modules coming in, then being moved into the gin.
This year, the ginning pace has moved more slowly — a scenario being repeated around the Mid-South as gins cope with one of the leanest cotton volumes in years. The modicum of good news is that it appears to be a generally good crop.
The whirlwind of activity normally associated with cotton was transferred in spades to the harvesting and transporting of corn and early soybeans. For weeks, fields and highways have been abuzz with combines and grain trucks.
For those not pole-axed by the severe drought in much of the area north of Memphis, the switch to corn was a fortuitous one, with excellent yields — there have been many reports in the over-200 bushels range.
With the opportunity to book both corn and beans at the most attractive prices in years, coupled with exceptional yields, this promises to be a good money year for a lot of farmers.
It may not be the spreading-through-the-economy equivalent of high-yield cotton money, but it ain't to be sneezed at, either.
And with wheat recently topping an all-time record $9 (as recently as 2000, it barely went over $2 a bushel), and very strong futures prices into 2008 for soybeans and corn, it looks as if grains will again be a major component of Mid-South agriculture next year.
All these prospects for money flowing into farmer bank accounts has put equipment companies and dealers in an optimistic mood, as they see producers more amenable to spending money to upgrade to new equipment and technologies.
Even with cotton's acreage downturn this season, several John Deere and Case IH dealers say they've booked orders for their new on-board module harvesters, which carry a list of nearly $500,000.
John Deere recently reported a record third-quarter profit, up 23 percent from 2006, and analysts predict strong sales for them, Case IH, and the entire equipment sector through 2008 and even into 2009.
Farm equipment sales for 2007 are expected to come in 16 percent above last year, with a more than 30 percent increase in row crop tractor sales.
Ag Equipment Newsletter, a publication for agricultural equipment marketers, in its Sept. 15 issue reported results of its annual survey of North American equipment dealers, noting, “It's difficult to find a product category that dealers aren't enthused about next year.”
Leading the list: GPS and auto-steer technology, with 97.5 percent of the responding dealers expecting improved sales in 2008. Other results: 95.1 percent for self-propelled sprayers; 94.3 percent for planters; 93.8 percent for combines; and 92.4 percent for 4-wheel drive tractors.
The newsletter's survey showed dealers also are expecting increases in 2008 for sales of used equipment.
Demand for farm equipment is up by about 5 percent worldwide, industry analysts note, but agricultural equipment sales are up 16 percent.