Price Opportunity on Sprayers

“Pricing Opportunity on Older Sprayers” was originally published in December 2019 Issue of Successful Farming Magazine – Republished with permission

After years of sluggish new sprayer sales, a slug of late-model self-propelled units hit dealer lots this fall, offering the potential to make a deal of such late-model applicators. On John Deere’s dealer website, machinefinder.com, there are 429 1- to 3-year-old sprayers listed. Both R4038s and R4045s are in particularly high supply. Looking just at 2018 model year sprayers available, there are 201 machines listed (models R4023, R4030, R4038, and R4045); their average use tallies up to just 352 hours.

Similar healthy listings of late-model Case IH, Ag-Chem, Hagie, and Apache applicators being offered by dealers are also found on websites such as ironsearch.com, tractorhouse.com, and fastline.com.

What is noteworthy of [a set of recent] listings of R4030, R4038, and R4045 applicators (which are the most popular models sold by John Deere) are not only their low hours but also how well equipped the machines are. For example, 100- and 120-foot booms are all but the standard. In Fact, 120-foot booms appear to be becoming a standard width selection. Also, many of these applicators are feature-rich, offering stainless steel tanks, hydraulic tread adjustment, AutoTrac guidance, Traction Control, boom leveling, and ExactApply individual control nozzle control.

PRICING OPPORTUNITY ON OLDER SPRAYERS

The pricing opportunity mentioned before is that a 1-year-old applicator with low hours represents a depreciation windfall. David Davidson with Iron Solutions says self-propelled sprayers suffer as much as 24% depreciation loss of value after their first year of use. All machinery does get hit from an initial value decline. However, it appears that self-propelled sprayers are particularly hard hit in value loss right out of the gate.

The good news, according to Davidson, is that depreciation losses level out considerably after the first year.

“For you sprayer bargain hunters out there, the data suggests that purchasing a 6-year-old sprayer would result in the highest percentage of retained value in the four years to follow,” Davidson points out. “Or, in other words, the 6-year-old unit would have the lowest percentage depreciation for the four years to follow.”

The article to the right provides a good example of Davidson’s research. Note the gradual step-down in values during the incremental four-year spans of the Deere sprayers analyzed.

Sprayer size has an impact on average prices, as would be expected. Yet, price ranges begin to spread widely, particularly on the largest applicators; they see more use as commercial sprayers and run far more hours during the year.

Examples of this price spread are the 2014 models 4940 and 4830. If you are considering such sprayer applications, find out who owned and operated them.

Buyer’s Price Guide on 17 Years of John Deere Sprayers

As David Davidson points out, there is a sweet spot of depreciation with sprayers. After taking a big hit in their first year, sprayer depreciation levels out in the next nine years with average depreciation of 5% to 6% in years two through five and then around 3% in years six through 10. Tipped off by Davidson’s research, following are price and hour averages and ranges on Deere applicators from 2002.

View current listings of sprayers on IronSearch.com

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