Farm Machinery Markets Beginning to Stabilize

A DTN article says signs are showing that the farm machinery industry is starting to stabilize after prices had been free falling for some time.   John Deere Chairman and CEO Samuel Allen said his company is seeing several signs that after years of steep declines, key ag markets may be stabilizing.  That does not mean farmer shave started to replace the equipment during the boom years of 2011-2013.  Recent lower sales have led to layoffs, cutbacks and tighter profit margin for farm equipment manufacturers.  Sales numbers in the first quarter of 2017 offered some home, as North American sales jumped 6.3%.

“We are seeing signs that after several years of steep declines, key agricultural markets may be stabilizing,” Allen said.

John Deere released second quarter sales numbers last week showing net income 62% higher than this time last year. However, that number does reflect some cost cutting measures taken by the company in recent months as well as non-ag sales numbers. The under-40 horsepower tractor market has been a bright spot for manufacturers. At the end of this year’s first quarter, sales were up 12% over the same time last year.

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