The maker of the green machines has lowered its full year profits forecast for the second time in four months. It now expects just a 4% increase in sales and $3.2bn in net profits for the year. Four months ago, it expected a 5% increase in sales and net profits of $3.3bn. Overall sales of equipment were down 3% compared to the same quarter last year, with the company’s agriculture and turf segment reporting a sales decline of 6%.
Samuel Allen, chairman and chief executive officer, says export-market access, near-term demand for commodities such as soybeans, and overall crop conditions have caused many farmers to postpone major equipment purchases. The fundamentals for US farmers have deteriorated in recent months driven by a strong dollar, a slow start to the planting season and growing supplies from South America.
The US based company blamed the trade war between the US and China for its weaker performance. It is sensitive to steel prices for production costs and also to farmers whose crops exports are facing uncertain demand from China and therefore delaying purchases.
ADVERTISEMENT
This week, the US Department of Agriculture projected corn production to increase 26m bushels from its July projection, to 13.9bn bushels for the 2019/20 crop year. Shares of Deere fell more than 4% on Monday following the release of USDA’s updated projections, however they have since recovered.
Register for free to read this story and our free stories.
This content is available to digital subscribers and loyalty code users only. Sign in to your account, use the code or subscribe to get unlimited access.
The reader loyalty code gives you full access to the site from when you enter it until the following Wednesday at 9pm. Find your unique code on the back page of Irish Country Living every week.
CODE ACCEPTED
You have full access to the site until next Wednesday at 9pm.
CODE NOT VALID
Please try again or contact support.
The maker of the green machines has lowered its full year profits forecast for the second time in four months. It now expects just a 4% increase in sales and $3.2bn in net profits for the year. Four months ago, it expected a 5% increase in sales and net profits of $3.3bn. Overall sales of equipment were down 3% compared to the same quarter last year, with the company’s agriculture and turf segment reporting a sales decline of 6%.
Samuel Allen, chairman and chief executive officer, says export-market access, near-term demand for commodities such as soybeans, and overall crop conditions have caused many farmers to postpone major equipment purchases. The fundamentals for US farmers have deteriorated in recent months driven by a strong dollar, a slow start to the planting season and growing supplies from South America.
The US based company blamed the trade war between the US and China for its weaker performance. It is sensitive to steel prices for production costs and also to farmers whose crops exports are facing uncertain demand from China and therefore delaying purchases.
This week, the US Department of Agriculture projected corn production to increase 26m bushels from its July projection, to 13.9bn bushels for the 2019/20 crop year. Shares of Deere fell more than 4% on Monday following the release of USDA’s updated projections, however they have since recovered.
If you would like to speak to a member of our team, please call us on 01-4199525.
Link sent to your email address
We have sent an email to your address. Please click on the link in this email to reset your password. If you can't find it in your inbox, please check your spam folder. If you can't find the email, please call us on 01-4199525.
ENTER YOUR LOYALTY CODE:
The reader loyalty code gives you full access to the site from when you enter it until the following Wednesday at 9pm. Find your unique code on the back page of Irish Country Living every week.
SHARING OPTIONS