Farm slump hits John Deere
17 February 1999
Farm slump hits John Deere
THE slump in farm incomes has hit first quarter profits at John Deere which fell to just $49.7 million (£30m) from $203.3m for the same period a year earlier.
The US company said operating profit on the agricultural side was barely one-tenth of the level a year ago.
Demand for large tractors and combines was “severely affected”, and production cuts meant manufacturing assets were used less efficiently.
Total agricultural equipment operating profit was just $25m, compared with $206m a year ago.
Overall sales for the quarter were down by 14% at $2.46bn.
The company is making a pessimistic forecast for this year. It expects net cash income among US farmers to fall about 9% this year, which it believes will mean that retail demand for farm equipment will decline by 25%.
- US machinery makers show strain, FWi, 17 September, 1998
- Tractor demand dropping, warns John Deere, FWi, 19 August, 1998
- Financial Times 17/02/99 page 29