It looks like Manitoba and Saskatchewan farmers aren’t buying the same volume of farm equipment they used to. If you look at sticker prices and interest rates these days, that should come as no surprise.
The financial difficulties followed AgWest’s expansion into Saskatchewan after its 2023 acquisition by Dutch-based Zweegers Equipment Group.
Court records show AgWest has approximately $73.7 million in liabilities and $75.8 million in book assets, most of which consist of equipment inventory.
BMO is owed roughly $34.3 million under operating and credit facilities. AGCO Canada and CLAAS of America hold secured floor-plan claims totaling approximately $28.2 million, while Farm Credit Canada is owed $10 million secured against real estate.
Who’s going to take the risk of adding/upgrading equipment in Canada when the government is deliberately sabotaging the Ag sector with carbon taxes?
They’re going to invest that money in the USA for a far better rate of return and far lower risk, meanwhile making due with their existing setup for longer. Because money talks and BS walks.
” … while Farm Credit Canada is owed $10 million secured against real estate.”
I wish that was all that was owed to FCC instead of the actual mega billions on their ledgers. You and I are the de facto shareholders.
“$73.7 million in liabilities and $75.8 million in book assets”. Hmmm … I’m suspicious. Who came up with the book value of the assets? The bank that lent the $73.7 million or the guy who borrowed it? Look under the hood and that 4 cylinder is probably leaking oil.
Unsellable farm machinery?
Custom rates of $75/acre for harvesting crops. Rental rate of $450/separator hour for red combine. AGCO decides to do a system wide upgrade of their parts system during the prime 6 weeks of harvest season. High price of food might be fondly remembered if there are empty grocery shelves.
Just like consumers don’t pay tariffs … farmers don’t pay inflationary prices. Psssst KM … the consumer SETS the market … nobody else.
I heard a rumour of a recent emergency dealers meeting for John Deere (Western Canada), where they were discussing the problem of just under 1 billion dollars worth of combines sitting in inventory that are not moving..