The ag equipment downturn is now a three-year slide: U.S. farm machinery and equipment sales dropped 13.16 percent in 2025, to 217,279 units, per University of Illinois farmdoc daily analysis published in February 2026, while used tractor inventories logged their eighth straight monthly decline in December 2025. Manufacturers have responded by cutting production, and dealers say the used-iron overhang is the bigger problem than new-unit demand alone.
What do the 2025 numbers show?
Every major category lost ground, with combines falling hardest — industry tallies for 2025 show total ag tractor sales down about 13 percent and combine sales down nearly half on a year-to-date basis as the year closed, per Farm Progress reporting on manufacturer disclosures. The farmdoc daily analysis, drawn from Association of Equipment Manufacturers and dealer-network data, ties the slump to compressed farm income, high financing costs, and tariff-driven price pressure on imported components. December 2025 marked the eighth consecutive month of falling used tractor inventories, down 1.9 percent, which cuts two ways: dealers are working down stock, but mostly because trade-in values, not retail demand, are setting the market.
How are dealers and manufacturers responding?
Production cuts first. Major manufacturers trimmed North American output through late 2025 and early 2026 to stop inventories building further, per Farm Progress. On the retail side, a dealer survey by No-Till Farmer found roughly a third of dealers expecting used equipment sales to fall again in 2026 and 40 percent calling their used inventory too high. Iron Solutions' first-quarter 2026 used-market review described cautious optimism against persistent structural pressures — translated: good late-model units move, anything older sits.
What does this change at the farm gate?
For operators with cash or credit capacity, this is the strongest buyer's market since 2020. Trade-in values are the soft spot, so the arithmetic favors keeping the traded unit out of the deal where possible. Three practical consequences follow. Used late-model tractors and combines with remaining warranty carry the discounts; hours and service records matter more than ever at resale. Repair-and-maintain budgets deserve a fresh look — parts and service departments are where dealers are making their margin, and shop lead times, not parts prices alone, set downtime cost. And anyone shopping new should ask the dealer directly about tariff surcharges on specific models, since those vary by origin and are not always in the sticker.
Is a recovery visible yet?
Not in the early data. The 2026 selling season opened with the same fundamentals that shaped 2025 — tighter row-crop margins and elevated rates — and analysts' base case, per the farmdoc daily review, is a continued gradual decline rather than a cliff. The silver lining for buyers: a market that punished leveraged purchases in 2022 and 2023 is now pricing equipment for the patient.
Frequently asked questions
How bad was 2025 for equipment sales?
U.S. farm machinery sales fell 13.16 percent to 217,279 units, per farmdoc daily's February 2026 analysis, with combines down hardest and used inventories declining for an eighth straight month by December.
Are used equipment prices falling?
Late-model used values have weakened as dealer inventory aged, per Iron Solutions' Q1 2026 review and dealer surveys — older, high-hour units are the slowest to move.
Is this a good time to buy a tractor?
This site does not make buy calls. The documented facts: manufacturers are discounting through production cuts and dealers carry high used inventory, conditions that historically favor buyers.
For more context, read Ag trade policy in 2026: tariffs, payments and open questions.
For more context, read fertilizer prices 2026.
For more context, read What grain basis measures, and why it swings by region.