Deere Article

[Texasmark]

Local news station posts some national headlines. One posted this AM had to do with Deere and Co. who aren't meeting their sales objectives and posted the reasons.....Layoffs are specified and where, and mention of a move of a production facility to Mexico. I'm not surprised given the current situation. Probably not a problem to Google if you are interested.

For me, as a farmer, some reasons for lack of sales were mentioned, in addition to those reasons, my summer crop is in limbo. Hoping the Hurricane that is in the gulf does as most do, turn East over the US which will give me some much needed rain. Course folks on the coasts don't like them but no body made them move there and I was raised on the Tx. coast. As has happened the last few years, springs stay wet so you can't get your winter hay crop in and when mommy nature turns off the spiggot, it stays off and challenges the summer hay crop. More than once Hurricanes have saved the day for me.

 

[moresmoke]

Happening all through the industry. It’s not that farmers are not buying equipment, they are just not buying as much of the high dollar equipment.

 

[E.B. Haymakin']

Local news station posts some national headlines. One posted this AM had to do with Deere and Co. who aren't meeting their sales objectives and posted the reasons.....Layoffs are specified and where, and mention of a move of a production facility to Mexico. I'm not surprised given the current situation. Probably not a problem to Google if you are interested.

For me, as a farmer, some reasons for lack of sales were mentioned, in addition to those reasons, my summer crop is in limbo. Hoping the Hurricane that is in the gulf does as most do, turn East over the US which will give me some much needed rain. Course folks on the coasts don't like them but no body made them move there and I was raised on the Tx. coast. As has happened the last few years, springs stay wet so you can't get your winter hay crop in and when mommy nature turns off the spiggot, it stays off and challenges the summer hay crop. More than once Hurricanes have saved the day for me.

I would also guess that less than 5% of the population is even engaged in owning a farm if that much. There's just not that much market left for any, any new tractor production in the US. With the cost of home ownership at catastrophic levels only subsidized big ag will by new. And there ain't that many, and there's plenty of competitors building tractors also. Good luck ma Deere

 

[Mike(NEOhio)]

You can't think of Deere in terms of farming alone. They produce so much other machinery. Plus, you can't forget the licensing.

 

[JD Dave]

I've always managed a tight ship and I'd love to buy a new tractor but it's not in the cards this year. I'm projecting break-even.

 

[Russ from MN]

With all the rain the upper Midwest isn't going to have a very good year!

 

[RJKeith]

I would guess interest rates are a major culprit in that. Higher interest rates make the equipment more costly to finance. Deere also make construction equipment, and higher interest rates are slowing that industry as well.

 

[moresmoke]

I would also guess that less than 5% of the population is even engaged in owning a farm if that much. There's just not that much market left for any, any new tractor production in the US. With the cost of home ownership at catastrophic levels only subsidized big ag will by new. And there ain't that many, and there's plenty of competitors building tractors also. Good luck ma Deere

Year to date as of May 31, there were 5499 tractors 100-139hp sold in North America, down from 5829 in 2023.
140+ hp, 5515 YTD, 5478 2023 YTD. 4WD 2024 up from 1945.

Sales of under 100hp and planters are off 30%. So the market is not quite as bad as some would have you believe.

 

[NoDakInMN]

I would guess interest rates are a major culprit in that. Higher interest rates make the equipment more costly to finance. Deere also make construction equipment, and higher interest rates are slowing that industry as well.

Exactly. Farmers get hit with inflation on everything they buy and higher interest is a part of that. But what they produce is a commodity and inflation doesn't enter in to how the pricing for commodities are determined. Most businesses can cope with inflated costs by inflating the price of their products, farmers don't have that option.

One indicator of the health of the construction industry is lumber pricing. Right now the lumber prices are dropping because there is a glut of materials not being used. That's largely due to interest rates slowing new home construction.

One sure way to counteract inflation would be to increase our domestic oil production and delivery. You drop the cost of energy and that affects the cost of virtually everything that is produced, which in turn leads to lower costs for those products. Unfortunately, the current train of thought of those in charge worldwide, is to make us all more reliant on ever more expensive forms of energy. Consequently, until that changes, we are going to be stuck in an inflationary cycle.