Low farm income, a challenging growing season, and the impact of trade tariffs on agriculture have farmers putting off purchases of equipment. The depressed farm economy is part of the factors why Deere & Co. trimmed its earnings forecast for the year to $3.2 billion, from an expected $3.3 billion and a five percent increase in sales.
The sales figures are still up four percent from last year. Deere reports quarterly sales of farm equipment fell six percent from 2018 levels as profit from the farm equipment business dropped 24 percent. Deere chairman and CEO Samuel Allen says the third-quarter results “reflected the high degree of uncertainty that continues to overshadow the agricultural sector.”
Overall, Deere’s worldwide net sales and revenues decreased three percent to $10 billion, for the third quarter of 2019 and increased five percent to $29.4 billion, for nine months. Net sales of the equipment operations were $9 billion for the quarter and $26.2 billion for the year, compared with $9.3 billion and $25 billion last year.