I am sure you have all heard about the drought. I grew up in the bush, & with family and friends still on the land, I am quite close to all that is going on in that space, and it is a lot worse than the media suggests.
As an expert valuer I have completed a number of valuations on AG equipment where the owners have to raise cash against their assets. This is not only to keep their animals alive, but also to keep their businesses solvent.
For the expert valuer it is a “Catch 22” where the values are down, no-one can afford to buy, and no-one wants to, nor can they afford to sell!
Looking at the machinery that was being assessed, it was largely underutilised, with low hours and mostly in very good condition, because quite simply, it has not been working due to the drought.
Much of this machinery is imported, and the cost of replacing these assets is increasing due to the fall of the Aussie dollar. This is assisting in keeping the values from going through the floor.
There is one solution to all of this…..Rain.
As an expert valuer I don’t know when it will rain, I just know that it will!