As we close out this year, let’s take a moment to celebrate both the bonds of our personal families and the incredible community we’ve nurtured as part of the Association. May your holiday season be filled with joy and peace, and may 2025 bring continued success and discovery.

We’re proud to be part of your journey and look forward to celebrating together in the year ahead.

While staff monitors both state and federal legislation, for our fiscal year ended Aug. 31, 2023, the Association did not participate in activities that would require members to declare a portion of their membership dues as non-deductible.

Members can claim the full amount of dues paid as an ordinary and necessary business expense. (Same status for our fiscal year ending Aug. 31, 2022.) Even in years when legislative issues have called for the Association to hire lobbyists or devote staff time to making elected leaders aware of members’ interests, the Association has neither endorsed nor contributed to the campaigns of candidates or any political action committees.

As we begin 2024, our Association staff is tracking bills related to husbandry use, dealer relations, and right-to-repair. Watch this publication for developments.

Know About Important Legislation? If there is a piece of legislation in your state that you think the Association should monitor? Let us know and we will advocate on your behalf. Call the office at (314) 878-2304 or Gina@FarmEquip.org

Sell’s Equipment started as a mechanic shop servicing the nation’s Ford Model T boom of the twenties in 1923. They survived the depression just in time to begin selling Ford tractors in 1940. By December 1941 manufacturers shifted focus to production for the war, but through ingenuity and dedication to the community, Sell’s equipment was ready for the agricultural and construction boom that followed the war.

Hutson is committed to leveraging our economies of scale that’s supported by 31 locations spread across Kentucky, Indiana, Tennessee, and Michigan to ensure we create the ultimate value proposition for our customers.

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Fourth Quarter 2022 Highlights

• Record fourth quarter results for sales and adjusted EBITDA
• Sales increased 14% to $374 million on a year-over-year (‘YOY’) basis
• Adjusted EBITDA¹ increased 14% to $51 million on a YOY basis
• Adjusted EBITDA margin² of 13.6% vs 13.7% on a YOY basis
• Total leverage ratio² of 3.7x at December 31, 2022 vs 4.1x at September 30, 2022 and 4.7x at December 31, 2021

Full year 2022 Highlights

• Third consecutive year of record sales and adjusted EBITDA results with growth largely attributable to organic growth efforts and initiatives
• Sales increased 22% to $1.46 billion on a YOY basis
• Adjusted EBITDA¹ increased 33% to $235 million on a YOY basis
• Adjusted EBITDA margin² of 16.1% vs 14.7% on a YOY basis

Outlook

• Management expects full year 2023 adjusted EBITDA to be at least $260 million¹, representing continued growth and momentum
• Backlog³ is up 10% YOY as of December 31, 2022, despite the deferred or cancelled orders as a result of the conflict in Ukraine, and is sitting at record-levels for year-end and near-record levels all-time

Farm Segment

The Farm segment delivered impressive results in the fourth quarter, with sales and adjusted EBITDA growing by 24% and 4% YOY, respectively. In addition, full year sales and adjusted EBITDA growth of 20% and 16%, respectively, continue the trend of strong momentum over an already historic performance in 2021. This growth was fueled by the continued demand for portable grain handling equipment in Canada, the U.S., and Asia Pacific, as well as permanent grain handling and storage solutions in South America. As consumption continues to increase globally, we are seeing sustained demand for our Farm segment products as growers around the world increase production. The fourth quarter adjusted EBITDA margin decreased as compared to the fourth quarter of 2021 as that quarter benefited from the price increases we implemented ahead of rising input costs which peaked in 2022.

OUTLOOK

Sustained demand for agriculture equipment and infrastructure enabled AGI to cap off another record year in sales and adjusted EBITDA with excellent momentum heading into 2023.

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 has been introduced in 42 states and two provinces — but none of the bills have made it into law, Gay Gordon-Byrne, head of The Repair Association, conceded during a recent webinar hosted by the Canada West Foundation.

But she told another panelist — Eric Wareham of the North American Equipment Dealers Association — that the fight is far from over.

“The dealers have frankly done a magnificent job of lobbying against right to repair and I say, ‘Eric, of all the bills that haven’t passed, congratulations — you did a great job,” said Gordon-Byrne.

Manufacturers and dealership groups, meanwhile, argue that many just want to bypass emissions controls and boost horsepower, something they term the ‘right to modify.’

Farmers already have the ability to repair 98 per cent of a piece of agricultural equipment, Wareham argued.

“The two per cent we do not allow access to is our critical safety and emissions criteria functions,” he said. “We fully support the right to repair but not to modify.”

Producer downtime is a problem, Wareham acknowledged, but said there are two causes — a shortage of technicians and a lack of broadband.

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Utilizing existing manufacturing facilities located just off the Interstate 80/35/235 Northeast mixmaster, Vermeer is hiring 60 – 80 people with the goal to begin manufacturing critical parts in February.

The new manufacturing operation will focus on building critical components that Vermeer equipment uses when it digs into the ground to install infrastructure. By having a team solely focused on these aftermarket parts, Pella operations can focus on whole good production.

Headquartered in Pella, a family-owned-and-operated company is celebrating 75 years of business this year.

Source: | Member since 1998

With good times in the farm sector, the value of farm assets would climb 10% this year, following a 10% increase in 2021 — the No. 2 year for farm income — said the USDA in its Farm Income forecast, issued three times a year. Farm debt would climb more slowly, and the debt-to-asset ratio, a measure of financial health, would drop to 13.05%, its first decline since 2011.

Crops and livestock will generate $541.5 billion in cash receipts, up 24%, or nearly $106 billion, from last year. Almost all of the increase, $96.8 billion, would be the result of higher prices, calculated USDA economists. Corn, wheat, and soybean would fetch an additional $37 billion this year compared to last. Higher broiler chicken prices would boost receipts by 55%. Revenue from cattle, hogs, turkeys, and milk also would climb. “Cash receipts for chicken eggs are expected to more than double,” said the USDA.

Commodity prices boomed with the return of China to the U.S. market in fall 2020, and they surged again after the Russian invasion of Ukraine last February. The invasion disrupted grain and fertilizer exports from the Black Sea region. Ukraine and Russia are major wheat exporters, and Russia leads in fertilizer exports.

Farm production expenses were forecast to rise 18%, to a record $442 billion this year. “This would represent the largest year-to-year dollar increase in nominal terms on record,” said the USDA. Nearly every category of expense would go up. Fertilizer, lime, and soil conditioners would increase by 47%, fuel and oil by nearly 48%, interest costs by 41%, and livestock feed, the largest category, by 17%.

Farm groups have focused on the rise in expenses and have asked lawmakers, with a new farm bill to be written in 2023, for higher reference prices, a factor in calculating crop subsidies, and more protection through the government-subsidized crop insurance program.

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Great Plains Manufacturing, Inc. (GPM), today announced that David Disberger will succeed Linda Salem in her role as President and CEO of the company following her semi-retirement on Jan.1, 2023.

A 36-year veteran of the industrial sector, Disberger steps into this role from his current position as Great Plains Manufacturing Executive Vice President, a role he has held since 2020. In this role,

David had oversight responsibility for manufacturing operations, Great Plains International, Great Plains Ag Division, and Great Plains Trucking – all preparing him for the leadership of the overall company.

Salem will work in an advisory capacity during 2023 to ensure an orderly transition in GPM leadership and operations.

“Great Plains’ mission is strongly centered around customer satisfaction, taking care of our employees, and ensuring sustained profits are achieved. I look forward to carrying on our mission alongside our great team of leaders at Great Plains Mfg.,” said Disberger.

Salem’s semi-retirement comes after more than a 28-year career with GPM, having first joined the company as Director of Financial Reporting and holding several leadership positions that led to her role as President and CEO in 2013.

“It has been an honor to lead this vibrant organization for so many years. The transition to ownership by Kubota North America Corporation in 2016 provided an opportunity for tremendous growth,” said Salem. “This transition comes at a time of significant growth and investment in GPM.”

The company recently completed a construction equipment (CE) manufacturing facility in Salina, KS, with an initial Phase Investment of $53 million. The second phase of the CE facility expansion, a $124 million investment, is underway.

The company recently completed a construction equipment (CE) manufacturing facility in Salina, KS, with an initial Phase Investment of $53 million. The second phase of the CE facility expansion, a $124 million investment, is underway.

Source: |Member since 1980

The schedule is beginning to take shape. Networking events kick off Monday, March 20 with a morning fishing excursion. Tuesday offers a chance to get out on the links with other members during our annual golf tournament. While trap shooting won’t be on the schedule this year, an alternate networking event is in the works. Stay tuned for details. Wednesday is filled with more networking, the Showcase, and speaker sessions. The Summit concludes Thursday, March 23 with a final speaker session, breakout sessions, and a Technology Council meeting. A tour of a local manufacturing facility is also planned for Thursday afternoon. Commitments for elected leaders begin Tuesday morning, March 21.

An upcoming issue of the Shortliner will contain more info on sessions, but preliminary plans include: a discussion on succession planning with Pinion; Sentry will discuss product liability and Heather Ranck from US Commercial Services will discuss the RAISE International Trade Program.

Watch for an email soon about registration and check out a video here:

Just-in-time supply chains took a lot of heat during the pandemic after empty shelves laid bare the pitfalls of ordering as little inventory as possible in the name of efficiency.

But, with retailers now struggling with inventory glut and overstocked warehouses, could the lean operating model be making a comeback?

Experts are mixed: While some believe that just-in-time has no place in the supply chains of the future, others say a modified version of the strategy will still be necessary to maintain resilience while keeping costs down.

Supply Chain Dive reached out to three experts in supply chain management to ask: Did the pandemic kill just-in-time? Here are their responses, which may be edited for length and clarity.

Lisa Anderon: CEO of LMA Consulting

Just-in-time is not dead; however, the days of taking the concept literally and ordering inventory to arrive ‘just in time’ is dead. The just-in-time concept has always accounted for common sense decisions. For example, if ordering strategic inventory from China, you should account for likely demand and supply volatility and stockpile inventory appropriately. With that said, most businesses were completely focused on efficiencies prior to the pandemic and took just-in-time literally, assuming the supply chain would continue to support their needs. They went through the motions of assessing risk, but did not adjust their inventory profiles and were left empty handed during the pandemic.

Executives have realized that the supply chain is a system of systems, and no one can control the end-to-end supply chain, let alone their link in the supply chain. Instead of living on hope, they are assessing supply chain risk, reevaluating their supply chain footprint, dual sourcing key products or materials and determining where to locate strategic capacity and inventory to support changing demand patterns. As a pending recession is looming, smart executives are tightening their control over inventory while still accounting for their risk, footprint and customer conditions. As companies reshore, nearshore, expand capacities and rollout advanced technologies, supply chains will reshape for the future.

If companies are following the literal just-in-time methodology, they will wind down during this reshaping process. It will not be for the faint of heart as it will require taking on risk, reconfiguring and expanding where it makes sense, and investing in inventory to support customer success. On the other hand, for those following the just-in-time concept, they will incorporate the these changing conditions and right-size their inventory to support profitable growth.

Abe Eshkenazi: CEO of the Association for Supply Chain Management

The just-in-time system worked so well in the past thanks to dependable and stable conditions. But the pandemic blew a fuse, revealing flaws to just-in-time. Just-in-time promotes efficiency and product quality, but sometimes at the expense of resilience, and therefore isn’t always equipped to manage the turbulence of global events, like COVID-19, weather disasters and the Russia-Ukraine conflict. That’s one of the reasons why we saw disorder and disruptions begin to take over supply chains in 2020 and why we’ve been working to catch up ever since.

Now,  are pivoting from just-in-time to just-in-case to circumvent liability. Just-in-case is a system which depends on extra stock and buffers for high-demand products to maintain business continuity. This is another outcome of lockdowns and the ensuing changes in consumers’ shopping behaviors.

While just-in-case has value, that’s not to say that companies should completely abandon just-in-time as inventory levels remain elevated. A modified version of just-in-time can be beneficial where companies only stockpile certain vulnerable items to avoid fallout from potential disruptions. Clearly consumers still have an expectation of high variety, rapid delivery and reasonable cost that defined just-in-time supply chains.

Overall, just-in-time improves processes, raises standards and increases the quality of goods, resulting in stronger relationships between companies and consumers. Therefore, when applied strategically, a flexible just-in-time system should promote the resiliency and agility needed to navigate shifts in supply demands. The pandemic taught us many lessons and moving forward we can expect companies to reconsider how they implement just-in-time.

Jason Miller: Associate professor of supply chain management at Michigan State University and interim chairperson for Eli Broad College of Business’ Department of Supply Chain Management

The rhetoric that the COVID-19 pandemic killed just-in-time doesn’t accurately capture the dynamics. What we are seeing is the decision to reevaluate safety inventory levels.

Safety inventories are a function of uncertainty of demand as well as uncertainty of supply (specifically uncertainty of lead time from suppliers for full order quantities). COVID-19 has exacerbated both forms of uncertainty, which results in companies holding more safety inventories to achieve the same target service levels. As we see supply chains normalize through 2023 (barring some other massive shock), we would expect companies to reduce their levels of safety inventory to correspond to the “new normal” levels of demand and supply uncertainty.

Another dynamic the COVID-19 pandemic brought about was chronic shortages encouraged customers to engage in “gaming” behaviors where they intentionally over-ordered from suppliers because they feared suppliers wouldn’t be able to fulfill all demand and, instead, would be forced to allocate products to customers based on the percentage of order quantity. For example, if I suspect my supplier will only fulfill 80% of demand and I expect to sell 400 units, I place an order for 500 units.

Beyond needing to reset safety inventories and gaming, forecasting also became far more difficult once the COVID-19 hit. Greater forecast inaccuracy, especially over-projecting demand growth, caused many retailers to over-order inventories, which caused a glut of inventory in some sectors.

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