Dotnuva Baltic to develop its equipment rental business in a separate company Dotnuva Rent
Dotnuva Baltic, a company belonging to Linas Agro Group, is strengthening its long-term and short-term agricultural machinery rental services by moving this activity into a separate company, Dotnuva Rent UAB. The rental activities are planned to be carried out in all three Baltic countries.
Dotnuva Baltic will continue to specialize in selling agricultural machinery and spare parts and servicing, designing, and installing grain preparation and farm equipment. Meanwhile, Dotnuva Rent will focus exclusively on the rental of agricultural machinery and other services needed by farms.
‘The rental and service sector has been established in Western Europe for more than 30 years. In recent years, the Lithuanian market has also seen an apparent increase in demand for agricultural equipment rental services. The need for rental services is growing in all the Baltic countries, so we see an opportunity to strengthen and develop this sector.
The separation of the rental activities into a separate company will allow us to expand this service in all the Baltic States. We will be more flexible and able to respond more quickly to changing customer needs. We are building a team of professionals and, together with Dotnuva Baltic’s service department, have ambitious goals to become one of the leaders in the agricultural rental sector,’ says Dangis Valaitis, who is also the Managing Director of Dotnuva Baltic and heads the equipment rental company.
According to Valaitis, the growing demand for rentals, which has been growing for several years now, shows that farms are discovering rentals to improve their operational efficiency.
‘We have seen the increasing interest of customers in machinery rental and services, and in line with these trends, we have decided to invest in the development of machinery rental and services. Renting is attractive because of its better risk management, representing a fixed farm cost. In addition, renting machinery is convenient for farms because the company that rents the machinery takes care of preventive maintenance, troubleshooting, and after-sales service. Lithuanian farms tend to adopt the practice of renting machinery from the West, so an even larger part of the Lithuanian market will likely use this service regularly in the 5-10 year perspective,’ says the CEO of UAB Dotnuva Rent, about the prospects of this service.
According to the company’s calculations, in the first three quarters of this year, the number of rented machines increased by 20% compared to last year. And even twice as much as five years ago. When renting new machinery for the season, the farm owner receives full service, a replacement if needed, and professional advice to improve operation and productivity. The customer is virtually assured of smooth operation during the season, thus managing risks.
‘We will only rent new equipment with a factory warranty: new Case IH tractors, combine harvesters, and telehandlers of various capacities. However, we will also offer other machinery for rent if needed as farms diversify and cooperate, creating a need for specialized machinery for the season: slurry irrigators, straw choppers, etc.
As farms face staff shortages, there is an increasing demand for hiring machinery with an operator to do the work. We have seen an increase in demand not only for rental equipment but also for services. We have room to grow,’ says Valaitis.
It is planned that Dotnuva Rent’s rental fleet will comprise 70 pieces of new equipment in 2023, with a total value of EUR 12 million. The fleet will double in the coming year.