# Buying or leasing hay equipment



## downtownjr (Apr 8, 2008)

Another question to help my planning...tommorrow I am stopping by New Holland to look into a 3 x 3 baler and discbine. Stopping by MF (Hesston Series) and Krone later. One of my options, in my mind (lol)...is to buy the tractor (older hp if you recall my A/C question) and maybe lease the baler and discbine if they still offer that option. I am not really a brand loyal guy, more of a lower price hopeful guy. Has anyone on the forum leased hay equipment? Good, bad, or indiffent? Thought I would ask. Thanks.


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## IAhaymakr (Jun 4, 2008)

Never have leased equipment, hay or otherwise. But I can tell you that with highly depreciable items like haying stuff the lease payments will be high, with a lower residual value. So if you are cash poor it probably won't look too good. Leasing will not usually get you the best price either. Good luck.


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## haybaler101 (Nov 30, 2008)

I have leased a sprayer, but no hay equipment. I checked terms on both purchase financing and leasing a couple of times on hay equipment, and purchasing was the better option each time. Your individual tax situation can make a difference between leasing and purchasing and leasing keeps the equipment off of your balance sheet. Watch out for property taxes on leased equipment, they are payable to the county and state of the lease holder and can be salty.


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## RCF (Sep 14, 2009)

We have a set of triple mowers on a lease-purchase agreement that we got through an agricultural leasing agency that we tried and it ended up having the best financing at the time. I don't know about the other brands but Krone does offer leasing on big square balers but you are better off buying the baler. As far as leasing or buying it really just depends on what cash flows best for your operation.


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## mlappin (Jun 25, 2009)

You're best bet is to talk to your accountant. Leasing does have a few advantages, however after you make the payments, it's still not your's. On the other hand, you won't get any depreciation from leased equipment, but you can write the lease payments off just like any other expense.

Personally I'd rather own the equipment, but again that's just me, and it's just one of several reasons why I stick to round bales instead of taking the plunge into big squares. Big balers are expensive, they take more horse to run, and depending on the math used, use more fuel as well. Also need enough help to make sure all those big squares can be got off the field in a timely manner before a rain. With round bales, I can get em home as my schedule allows.


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## rank (Apr 15, 2009)

Probably should be patient and watch the auctions etc. A New Holland 3x3 square baler, with applicator (rumoured to be a 2008 model with 10,000 bales on it) went for $60,000 CDN at the Farm Show in Woodstock, ON a couple of weeks ago.

That's cheap for only $10,000 bales. A lightly used MX 220 went for ~$70,000. Maybe the sellers bought them back, I don't know.


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## downtownjr (Apr 8, 2008)

Thanks guys, you inputs are very much appreciated. Your thoughts are spot on concerning what I learned about the lease option yesterday. It is not really a vaible option for hay equipment. There are a few decent balers on tractorhouse that could fit the bill. NH tells me an A/C 7040 or 7060 will handle a 3 x 3, but I think the 7060 at least. The baler is heavier than the tractor by a few ton . Seems if I do this I should go with a dual axle baler with the turning system. Going to talk to MF tomorrow and Krone later this week, I also have my eye on a few discbines but it seems a good used one is not much cheaper than new. I have to hand to you guys already working a big operation...guess it is down to how fast I want to move now. Thanks again for your thoughts.

jim


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## OhioHay (Jun 4, 2008)

I don't have any experience with leasing hay equipment. Did it with a vehicle once that I knew I was going to buy. The rate was cheaper, so it worked out. I would think buying would be the better option. It seems like you are looking at some major upgrades of equipment all at once. I hope the opportunities that are out there are solid and will last till the payments are made. Hay prices are falling rapidly in my area. Everybody and there brother got into hay when the price boomed the last couple of years and baled every little pasture they could find. Now supply is blowing away demand in my area. Seems like a tough time to expand in hay. On the other hand, I have a older neighbor that always told me to walk when others are running and run when others are walking. It has been good advice. Good luck Downtown!


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