Amidst Historic Flooding, How Can Ranchers Protect Their Equipment’s Value?
By: Ron McClain, Director of Pricing and Sales Support, BigIron Auctions
As the great thaw begins, The National Weather Service predicts that 200 million Americans could see the impact of historic flooding on their communities. For ranchers and farmers, this flooding coin-cides with the Spring planting season. With equipment transactions ramping up this Spring, how can sellers protect the value of their equipment? Also, how can buyers ensure that they are getting what they purchased?
Immediately after a flood, sellers can take precautions to best preserve their equipment by changing fluids and filters, if applicable, as well as maintaining internal mechanisms and drying electronics. Operator cabs in heavy equipment will need some of the most care and should be dried out as soon as possible to prevent mold and mildew. Given the cold, harsh winter, recent rains, and melting snow, cattle producers should also keep a close watch on manure storage and pumping equipment. Monitor-ing the condition of this equipment is crucial to ensure that they are performing normally after abnor-mal weather conditions.
One of the biggest mistakes that sellers make is misrepresenting equipment to buyers. It is a costly mistake that can be avoided with due diligence and honesty. Sellers should not rush to judgment if they find their equipment compromised. Instead, sellers should get their equipment professionally as-sessed to determine how the equipment is impacted, to what degree it was impacted, and how that im-pact affects warranties. Sellers should keep in mind that flood waters often contain contaminants other than water, soil, and silt. Corrosive material may have visible effects months or years after the flood. Additionally, understanding if your state requires tags or stickers informing buyers that the machine has been in a flood is often a responsibility of the seller. Ultimately, the value of initiating repairs will be up to the seller. In all, selling equipment after a flood is more than just drying and cleaning–it’s about transparency.
For buyers of equipment, it’s important to be able to speak up when something seems suspicious. Understand the equipment the seller is selling and be sure to do a thorough inspection. If you’re able to view the equipment in person before purchasing, you put yourself in a much better position. A rule of thumb is that if you smell mold, walk away. Look for discolored cloth or paint, as both may indicate water damage. Additionally, damage to the electrical systems could prove dangerous. Buyers should feel comfortable testing the equipment for a period of time while listening for unusual sounds or alarms. If something seems off, another indication of water damage is brittle wires underneath the dash. Be sure to have a mechanic on-hand should further inspection be needed.
Buyers need to be aware of the risks and responsibilities associated with buying used equipment. Often, buyers work through an auction house, which in turn provides transparency on the part of both buyers and sellers. A reputable auction house can put buyers directly in touch with sellers to ask questions and initiate in-person visits. Additionally, a best-of-breed auction house can provide un-matched expertise during the buying and selling process.
Buying and selling agricultural equipment is built on trust. Between the buyer, and seller, natural disasters provide us an opportunity to showcase the strength of the farming community. Remaining committed to these principles helps ensure that we continue to fuel America and that used agricultural equipment continues to run at the highest levels possible