Evening star. [volume] (Washington, D.C.) 1854-1972, 1938-09-23
FARM MACHINERY
OUTLOOK IS GOOD
American Machinist Sees
Activity Ahead Despite
Lower Prices.
Special Dispatch to The Star.


NEW YORK, Sept. 23.-The outlook
for sales of agricultural machinery is
good despite lower farm prices. ac-
cording to today's issue of American
Machinist. The publication predicts
that this years sales will be about S
per cent Of the farmers gross income
Of $500. 000, 900, and that the upswing
in general business will be reflected by
an improvement in farm sentiment re-
sulting in an even higher figure for
1899.
After a lapse Of several months
agricultural implement manufacturers
have again placed cautious orders for
steel. It will be remembered that
during the first half of 1888 this in
dustry was one Of the main supporters
of the steel business. When the sud-
den slump in farm prices came in the
middle Of the summer agricultural
buying took q nose-dive.
1t is probable that grain and live
stock prices will not drop below pres
ent levels and may go higher under the
impetus Of war scares which means
that farmers will have more purchas-
ing power for next year. II low prices
continue, more extensive cultivation
will be practiced to keep up gross in
come Already new type Of corn is
coming into use which increases yield
by IS per cent or more. Yield Of
other products per acre Is being in
creased by improved practices and
methods which in turn require more
machinery.
Expenditures Greater.
The rate Of expenditures for farm
equipment has been greater in the
past three years than at any other
time because of Cd the need Of re-
placements after 1932-l934. I'd the
opening Of new markets with low
priced tractors and implements, 80
general improvement in business. and
% lack OF labor at prices which the
farmer could pay.
Low prices for his products plus the
necessity for getting his work done
Will lC<o llClp VIC lld0N ~ 1lCSLood4y
for the farmer to have larger plows
and other cultivating equipment,
tractors, combines and corn pickers
One manufacturer states that one Of
the biggest factors in the improvement
Of his sales over last year was the In
PRODUCTION Of low-priced combine.
Tractor companies have in the past
year spent millions Of dollars on plant
changes and additions One concern,
in addition to the amount spent on
its new tractor works, plans to spend
about 100000 for production of a
new small combine, with 200 to 300
men added to the pay roll when the
plan is completed in December. Plans
call for the manufacture OF 10000
units for the first year.
Export Trade Good.
For these reasons" says American
Machinist, lit is difIicult to see why
anything but an improvement in sales
can be expected for next year, par
ticularly since general business senti-
ment is improving which will in turn
improve the long-term outlook for the
farmer. The table (below) indicates
how quickly the investment in ma
chinery increases when sentiment i'm
proves and the long-term outlook Is
better.
Export business has been good in
the past year. In 1887 some SIS. O00,-
900 worth Of farm equipment was ex-
ported and export sales were holding
up pretty well until recently. I'm
settled foreign conditions make the
export outlook uncertain although it
is dinicult to see how our major i'm
plement customers, Canada, Australia,
Argentina, Great Britain and South
America, will be adversely affected"