How to Determine the Value of Liquid Fertilizer on Planters3/30/2023
This past week, I had the opportunity to join our Lead Data Scientist, Hank Mandsager, in a webinar analyzing the value of planter attributes. The warning signs that this was going to be a hairy undertaking were plentiful. A few quotes I’ve heard over the years when talking with both appraisers and dealers when it comes to placing a value on planters:
- “Planters can be the most difficult used item to put a trade value on because of the complexities”
- “Planters scare me in a very big way”
- “They [planters] give me night sweats”
- “Planters are definitely a witches’ brew….”
The webinar covered a lot of great questions regarding the influence of various planter options and an overview of major equipment category values and supplies. If you missed it, don’t worry, we have it queued up here. Planters are so varied that we couldn’t possibly hit all topics and an analysis like this usually generates more questions than answers. Here is one specific question that was asked afterward, "What is the value of liquid fertilizer on a John Deere DB60? Does it change if that planter has ExactEmerge?”
First, I should reiterate a point made in the webinar. The amount of add-ons and after-market kits exponentially increases the possible unique types of planters in the used market. So, what to do? They still need to be evaluated.
One of the most helpful situations to this valuation dilemma is if you have a buyer. A planter is worth the amount a farmer is willing to pay for it. That’s especially true here because of farmers’ unique soil composition, field shapes, crop type, planting strategies, and tractor attributes like horsepower and number of SVC hookups, to name a few.
When analyzing the worth of something like liquid fertilizer, you’ll want to eliminate as many variables as possible. At the very least, get down to a specific model and size of planter. For this instance, a John Deere 24 row DB60.
I pulled all DB60 24 row planters in our Tractor Zoom database. Once I filter down to just the confirmed 24 rows, we have 24 auction sales and 87 dealer listings to analyze.
Next, I sorted those that had liquid fertilizer in their description. Because there are sooooo many options on planters, we don’t list them all as filter buttons. My approach to this is filtering based on the description. You won’t want to use the fertilizer since that could also mean granular fertilizer. “Liquid” on the other hand is used almost solely for liquid fertilizer. You can do this in Iron Comps using the Description Filter in the Search Results tool.
One additional check that is nice here is to quickly browse through the resultant pictures. You can quickly identify any that don’t have a liquid tank on them.
Luckily, I was listening to Hank on our webinar and I know that options like ExactEmerge can influence approximately 25% of the value.
Once I had my liquid fertilizer set of DB60s, I exported the data into Excel for the final side-by-side comparison. In Excel I went through a similar process of filtering for a term. Don’t feel bad if you don’t love spreadsheets; I can help you out. Pop this formula into a column next to the description cell:
So, smoke/mirrors/spreadsheet magic happens (AKA sorting and averaging), and you get something like is pictured below. The 2x2 matrix is simply the averages of each scenario from our sample data. The blue column to the right is the percent difference between having liquid fertilizer or not if ExactEmerge is present. The green column is the absolute value difference for the same comparison.
Directionally, this is what we’d expect, and can see that 24 row DB60 planters equipped with liquid fertilizer bring almost $40K more if they also have ExactEmerge. Keep in mind there are likely other variables at play too that we haven’t included. For instance, if a 24 planter has variable rate capabilities and liquid fertilizer, it likely also has features like hydraulic down force. (The bottom row is the average of the total data set, not the averages of the two rows above it.)
We utilize the heavy machinery data ecosystem of Tractor Zoom to deliver analyses like this one. Check out other topics about the used equipment market, data quality, and more on our blog.
If you have a question that we haven’t touched on, or want to learn how you can list your equipment on Tractor Zoom, let me know! Email ACampbell@tractorzoom.com.