Farmers had a good year in 2020, and farm equipment manufacturers and dealers are sharing in their good fortune.

With the increased farm income University of Idaho Extension economist Garth Taylor said that Idaho farmers and ranchers should be sheltering their increased revenue from the Internal Revenue Service with land or equipment purchases.

“You’ve heard the old story, ‘what time is it when a farmer has to pay income taxes? It’s time to get a new accountant,’” Taylor said.

“Where are they going to shelter this?” Taylor asked rhetorically. “Well, they’re going to incur some additional expenses and try update their equipment line and try to buy land and other expenses.”

It was just one year ago this month that first reports of a coronavirus discovered in Wuhan, China, began to circulate in the United States and the world. By the middle of March, the U.S. economy and European economies were simultaneously crashing as the COVID-19 pandemic became the greatest global health crisis since the Spanish flu from 1918 to 1920.

While the U.S. economy continues to slowly recover from the impact of COVID-19, a recent report indicates that U.S. agriculture enjoyed record net farm incomes during 2020.

According to data released by the U.S. Department of Agriculture’s Economic Research Service on Dec. 11, net farm income in 2020, adjusted for inflation, was projected to increase $35 billion.

This represents the fourth consecutive year that net farm income has increased. The report stated that “net farm income in 2020 inflation-adjusted terms would be at its highest level since 2013, 32 percent above its 2000-19 average of $90.6 billion.”

Taylor said that despite the ramifications of COVID and reports of dumping spuds and milk Idaho set all-time record highs in net farm income.

“We broke net farm income, all record highs by huge amounts,” Taylor said, “Ben Eborn and I are predicting that it will be up almost 40 percent over last year.”

Taylor attributes some of Idaho agriculture’s export success this year to the dollar’s decrease in the foreign exchange rate and to increased exports of national commodities such as corn and wheat.

“The dollar’s been weakening, which makes our exports more price attractive,” he said, “and despite all of the news to the contrary, this year (the U.S.) had record high exports of corn to China and corn drives so much more markets than prices under a lot of different commodities, including Idaho hay. Idaho hay is keyed to corn prices and so we are looking at a very bright future for agriculture in the state.”

According to Taylor, agriculture continues to be the primary driver of Idaho’s economy.

“Idaho’s agriculture has been growing faster than the state’s economy,” he said. “We’ve always been growing faster in gross domestic product. Farm GDP far outpaces the growth of Idaho’s economy GDP. Idaho’s agriculture and farming is on a completely different trajectory growth path.”

Mike Lindsay, a John Deere field sales rep for Stotz Equipment in American Falls, said that sales for new tractors are up and that the waiting period for a new John Deere tractor is up to a year out.

“If they want new, yes, it’s gotten a lot harder to get the new equipment,” said Lindsay.

Tractor sales may be up nationally, but sales representatives for potato equipment manufacturers in Idaho and Utah say that their equipment sales range from average to slightly above average in 2021.

The National Potato Council’s Potato Expo, the Idaho Potato Conference and the Eastern Idaho Ag Expo, scheduled for January 2021, moved to a virtual platforms resulting in an absence of public gatherings and may have contributed to a reduction of orders.

“Sales are above average but we’re not going hog wild,” said Kelly Duffin, a sales rep for Double L based in Heyburn.

Duffin said the potato industry has yet to recover from last year’s economic crash and that impacts equipment purchases.

“First of all the fresh market is not good, demand is low, prices are low for fresh potatoes. There’s no restaurants open. COVID is still the problem,” he said. “There no restaurants open in the big cities, in the big markets. We need the restaurants to open back up for the demand or the products just back up.”

While purchases are above average Duffin said another issue facing manufacturer is the increased prices in steel.

“Huge steel increases that have taken place since November, multiple steel increases,” he said.

He said that the lack of ag shows has impacted their ability to meet with their customers at what is an annual tradition.

“Here in Idaho it is limited to ten people for a gathering, so you have no ag show,” Duffin said. “The National Potato Council meeting, that’s one of our biggest shows of the year, was scheduled in Texas, that was cancelled.”

Duffin said that the current situation creates roadblocks to success.

“When you don’t have those opportunities, yeah, it’s a little frustrating,” he said. “You spend a lot more time on the phone talking to people instead of face-to-face.”

In an effort to get together with their customers Duffin said that Double L and two other equipment manufacturers, Lockwood and Milestone, were exploring the possibility of holding open houses for small groups that fall within the state mandate that limits groups to ten people or less.

Shane Mitchell, marketing director for Milestone Equipment based in Blackfoot, said that sales were better last year than this year.

“I would say it’s looking like an average year,” he said “We’re selling enough to keep us busy but it’s not as busy as we were last year,” he said.

Milestone produces a variety of potato equipment but specializes in seed potato cutters and cut-seed treaters along with pilers and conveyors.

“This year it seems like we’re still selling stuff. There’s still interest out there but all the growers do seem to be a bit more careful in their decisions right now,” Mitchell said.

He said that they didn’t participate in the virtual conferences because they didn’t believe they were worth the time or the money.

“Our thought was if somebody wants to talk to us, if somebody wants to see what we’re about we have a website,” Mitchell said. “The virtual thing just didn’t feel like it was going to be productive.”

There’s just no substitute for a personal meeting with someone he said.

“It really does say something being able to be face-to-face with someone,” Mitchell said. “As I’m out here working on sales and equipment I always prefer to meet someone in person when we’re going over these machines and going over these quotes. I always prefer to do that in person.”

Allen Peterson, owner of Better Built Equipment based in Orem, Utah, said that equipment orders are down for 2021. Better Built produces seed cutters and cut-seed treaters for the potato industry.

“Typically our busiest times of the year’s after harvest and before planting,” Peterson said. “Last year when COVID happened, it basically shut us down during our busy time of the year and it wasn’t because we weren’t able to go to work it was because people weren’t calling and ordering stuff. This year is kind of fairly similar, we do have some sales but the numbers are definitely down.”

Peterson said that he participated in the NPC’s virtual Potato Expo but that he didn’t have a single encounter during the time he was online. Virtual shows just don’t create the traffic that he has seen at past shows.

“The Potato Expo is always one of the good shows for us,” Peterson said. “That’s one of the ones we go to and we do pick up quite a few sales from that one and then obviously Pocatello, Washington and so forth.”

At this point in time with orders down and all shows going virtual it’s not looking good for future sales this spring. Peterson is hoping to pick up some orders this spring but he is looking forward to the day when the Expo and conferences return to reality.

“Nothing beats that personal contact,” he said. “Even parts sales are down and I think one of the reasons is when those guys are attending those conferences, when they’re having their break and walking the trade show it also sparks, ‘Oh, hey, if I’m not looking at buying new equipment, I’m looking at servicing my equipment so I need to make sure I order these parts.’ I think right now because just because of the way things are going it’s quieter than it normally is this time of year.”

There may yet be a rush to shelter net farm income from the IRS in equipment and land purchases this year. Tax season is only just beginning and farmers and ranchers are starting to hear from their accountants.