Despite Downturn, U.S. Farm Suppliers Thrive


By Martha Raffaele — Associated Press Writer

HARRISBURG, Pa. (AP) — The nation's battered economy may have taken a toll on car sales and the housing market, but John Deere tractors are still a pretty hot commodity at Valley Ag & Turf.

"We still have things to deliver yet that were ordered from last year," said Harold Lenker, a salesman for the dealership in rural Halifax, about 10 miles north of Harrisburg. "The pipeline isn't empty yet, and the ag business is actually pretty decent at the end of the year. I had more people spending more money than they did in a long time."

The dealership was among 270 commercial exhibitors showing off their wares at last week's Pennsylvania Farm Show — more to educate the general public than to drum up business.

As throngs circulated among gleaming tractors, front-end loaders and horse trailers, company officials said 2008 generally brought sales as good as the previous year, if not better.

The Hoober Inc. display featured a towering red Case IH tractor that weighs more than seven tons and carries a price tag exceeding $142,000. Gary Hauseman, a salesman for the Intercourse-based dealer, said 2008 sales were up 10 percent to 15 percent from the previous year.

"2008 was a very strong year in the agriculture industry, some of that because of commodity prices, a lot of pent-up demand over the years, purchases that weren't being made because markets were tight," Hauseman said.

The outlook for 2009 is less certain, however.

Lenker's comments reflected Deere & Co.'s strong performance in sales of agriculture equipment for the fiscal year ended Oct. 31, the most recent financial results available. Sales rose 43 percent in the fourth quarter and 37 percent over the year.

Deere forecasts that its farm-machinery sales in the U.S. and Canada will grow by about 5 percent for 2009, fueled by increases in tractors and combines. It is expecting lower sales of cotton equipment, small tractors and equipment commonly used by livestock producers.

Jeff Altmeyer, sales manager of Altmeyer's Western Wear & Trailer Sales Inc. in Kittanning, said his business ended 2008 with horse trailer sales that were "pretty close" to the previous year. Brisk sales in the first half of the year were offset by a decline in the fall as the national economy weakened, Altmeyer said.

Altmeyer said he is approaching 2009 with caution. His offerings at the Farm Show ranged from basic utility trailers at around $5,000 to a fancy recreational trailer boasting living quarters and a flat-screen TV for more than $60,000.

"As things pick up, we'll deepen our inventory but kind of play it one month at a time," he said.

Owners of more specialized farm businesses also saw a fairly prosperous 2008. Among them was Zartman Farms in Ephrata, which makes cow mattresses from recycled rubber tires.

"'08 was a pretty good year," Tom Zartman said. "That'll fluctuate with the dollars a dairy farmer has available to try and improve his farm."

Despite a recent drop in milk prices, Zartman said he is still busy processing orders.

"We're already booked for all of this winter, until springtime," Zartman said.

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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