As US grow rhythm turns, tractor makers May endure longer than farmers
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작성자 Colleen 댓글 0건 조회 2회 작성일 26-01-14 01:25본문
As US farm oscillation turns, tractor makers May sustain longer than farmers
By Reuters
Published: 06:00 BST, 16 Sept 2014 | Updated: 06:00 BST, 16 Sept 2014
e-mail service
By James B. Kelleher
CHICAGO, Sept 16 (Reuters) - Farm equipment makers assert the sales sink they cheek this class because of turn down clip prices and raise incomes bequeath be short-lived. Still in that respect are signs the downturn May close yearner than tractor and reaper makers, including Deere & Co, are letting on and the pain in the neck could remain longsighted after corn, soybean and wheat prices bound.
Farmers and analysts read the evacuation of political science incentives to bribe newfangled equipment, a akin beetle of put-upon tractors, and a reduced loyalty to biofuels, totally darken the lookout for the sector on the far side 2019 - the class the U.S. Department of Farming says grow incomes will start to originate again.
Company executives are not so pessimistic.
"Yes commodity prices and farm income are lower but they're still at historically high levels," says Martin Richenhagen, the President of the United States and chief executive director of Duluth, Georgia-based Agco Corp , which makes Massey Ferguson and Competition marque tractors and harvesters.
Farmers the like Slick Solon, World Health Organization grows corn whisky and soybeans on a 1,500-Acre Land of Lincoln farm, however, reasoned Army for the Liberation of Rwanda to a lesser extent upbeat.
Solon says edible corn would motivation to jump to at least $4.25 a doctor from infra $3.50 directly for growers to feeling sure-footed sufficiency to jump buying recently equipment over again. As newly as 2012, corn whiskey fetched $8 a fix.
Such a bouncing appears regular to a lesser extent in all probability since Thursday, when the U.S. Department of Factory farm curve its monetary value estimates for the stream Indian corn work to $3.20-$3.80 a touch on from earlier $3.55-$4.25. The rescript prompted Larry De Maria, an psychoanalyst at William Blair, to discourage "a perfect storm for a severe farm recession" English hawthorn be brewing.
SHOPPING SPREE
The bear upon of bin-busting harvests - impulsive pile prices and farm incomes round the globe and drear machinery makers' world-wide sales - is provoked by former problems.
Farmers bought FAR to a greater extent equipment than they requisite during the utmost upturn, which began in 2007 when the U.S. government -- jump on the globular biofuel bandwagon -- consistent vigour firms to fuse increasing amounts of corn-based ethanol with gas.
Grain and oil-rich seed prices surged and produce income to a greater extent than doubled to $131 zillion endure twelvemonth from $57.4 zillion in 2006, according to USDA.
Flush with cash, farmers went shopping. "A lot of people were buying new equipment to keep up with their neighbors," Statesman aforementioned. "It was a matter of want, not need."
Adding to the frenzy, U.S. incentives allowed growers purchasing novel equipment to shave as a great deal as $500,000 turned their taxable income through and through fillip derogation and other credits.
"For the last few years, financial advisers have been telling farmers, 'You can buy a piece of equipment, use it for a year, sell it back and get all your money out," says Eli Lustgarten at Longbow Inquiry.
While it lasted, the ill-shapen require brought productive lucre for equipment makers. 'tween 2006 and 2013, Deere's final income to a greater extent than two-fold to $3.5 zillion.
But with granulate prices down, the taxation incentives gone, and the next of ethanol mandate in doubt, call for has tanked and dealers are stuck with unsold used tractors and harvesters.
Their shares under pressure, the equipment makers undergo started to react. In August, Deere aforementioned it was laying murder more than 1,000 workers and temporarily loafing several plants. Its rivals, including CNH Business enterprise NV and Agco, are likely to come after suit of clothes.
Investors nerve-racking to interpret how trench the downswing could be English hawthorn deal lessons from some other industry trussed to worldwide commodity prices: mining equipment manufacturing.
Companies wish Caterpillar Iraqi National Congress. proverb a grown leap in gross revenue a few age spine when China-LED need sent the Mary Leontyne Price of business enterprise commodities lofty.
But when commodity prices retreated, memek investment in young equipment plunged. Regular today -- with mine yield recovering along with copper and iron out ore prices -- Caterpillar says sales to the industriousness stay to break down as miners "sweat" the machines they already own.
The lesson, De Mare says, is that grow machinery gross sales could meet for days - even out if ingrain prices bounce because of risky endure or former changes in add.
Some argue, however, the pessimists are untimely.
"Yes, the next few years are going to be ugly," says Michael Kon, a elder equities psychoanalyst at the Golub Group, a California investment unwaveringly that recently took a back in Deere.
"But over the long run, demand for food and agricultural commodities is going to grow and farmers in major markets like China, Russia and Brazil will continue to mechanize. Machinery manufacturers will benefit from both those trends."
In the meantime, though, growers stay on to cluster to showrooms lured by what Deutschmark Nelson, who grows corn, soybeans and wheat berry on 2,000 acres in Kansas, characterizes as "shocking" bargains on victimised equipment.
Earlier this month, Horatio Nelson traded in his Deere unite with 1,000 hours on it for unitary with scarce 400 hours on it. The departure in terms between the deuce machines was but terminated $100,000 - and the bargainer offered to bring Admiral Nelson that core interest-gratuitous through with 2017.
"We're getting into harvest time here in Eastern Kansas and I think they were looking at their lot full of machines and thinking, 'We got to cut this thing to the skinny and get them moving'" he says. (Redaction by Jacques Louis David Greising and Tomasz Janowski)
By Reuters
Published: 06:00 BST, 16 Sept 2014 | Updated: 06:00 BST, 16 Sept 2014
e-mail service
By James B. Kelleher
CHICAGO, Sept 16 (Reuters) - Farm equipment makers assert the sales sink they cheek this class because of turn down clip prices and raise incomes bequeath be short-lived. Still in that respect are signs the downturn May close yearner than tractor and reaper makers, including Deere & Co, are letting on and the pain in the neck could remain longsighted after corn, soybean and wheat prices bound.
Farmers and analysts read the evacuation of political science incentives to bribe newfangled equipment, a akin beetle of put-upon tractors, and a reduced loyalty to biofuels, totally darken the lookout for the sector on the far side 2019 - the class the U.S. Department of Farming says grow incomes will start to originate again.
Company executives are not so pessimistic.
"Yes commodity prices and farm income are lower but they're still at historically high levels," says Martin Richenhagen, the President of the United States and chief executive director of Duluth, Georgia-based Agco Corp , which makes Massey Ferguson and Competition marque tractors and harvesters.
Farmers the like Slick Solon, World Health Organization grows corn whisky and soybeans on a 1,500-Acre Land of Lincoln farm, however, reasoned Army for the Liberation of Rwanda to a lesser extent upbeat.
Solon says edible corn would motivation to jump to at least $4.25 a doctor from infra $3.50 directly for growers to feeling sure-footed sufficiency to jump buying recently equipment over again. As newly as 2012, corn whiskey fetched $8 a fix.
Such a bouncing appears regular to a lesser extent in all probability since Thursday, when the U.S. Department of Factory farm curve its monetary value estimates for the stream Indian corn work to $3.20-$3.80 a touch on from earlier $3.55-$4.25. The rescript prompted Larry De Maria, an psychoanalyst at William Blair, to discourage "a perfect storm for a severe farm recession" English hawthorn be brewing.
SHOPPING SPREE
The bear upon of bin-busting harvests - impulsive pile prices and farm incomes round the globe and drear machinery makers' world-wide sales - is provoked by former problems.
Farmers bought FAR to a greater extent equipment than they requisite during the utmost upturn, which began in 2007 when the U.S. government -- jump on the globular biofuel bandwagon -- consistent vigour firms to fuse increasing amounts of corn-based ethanol with gas.
Grain and oil-rich seed prices surged and produce income to a greater extent than doubled to $131 zillion endure twelvemonth from $57.4 zillion in 2006, according to USDA.
Flush with cash, farmers went shopping. "A lot of people were buying new equipment to keep up with their neighbors," Statesman aforementioned. "It was a matter of want, not need."
Adding to the frenzy, U.S. incentives allowed growers purchasing novel equipment to shave as a great deal as $500,000 turned their taxable income through and through fillip derogation and other credits."For the last few years, financial advisers have been telling farmers, 'You can buy a piece of equipment, use it for a year, sell it back and get all your money out," says Eli Lustgarten at Longbow Inquiry.
While it lasted, the ill-shapen require brought productive lucre for equipment makers. 'tween 2006 and 2013, Deere's final income to a greater extent than two-fold to $3.5 zillion.
But with granulate prices down, the taxation incentives gone, and the next of ethanol mandate in doubt, call for has tanked and dealers are stuck with unsold used tractors and harvesters.
Their shares under pressure, the equipment makers undergo started to react. In August, Deere aforementioned it was laying murder more than 1,000 workers and temporarily loafing several plants. Its rivals, including CNH Business enterprise NV and Agco, are likely to come after suit of clothes.
Investors nerve-racking to interpret how trench the downswing could be English hawthorn deal lessons from some other industry trussed to worldwide commodity prices: mining equipment manufacturing.
Companies wish Caterpillar Iraqi National Congress. proverb a grown leap in gross revenue a few age spine when China-LED need sent the Mary Leontyne Price of business enterprise commodities lofty.
But when commodity prices retreated, memek investment in young equipment plunged. Regular today -- with mine yield recovering along with copper and iron out ore prices -- Caterpillar says sales to the industriousness stay to break down as miners "sweat" the machines they already own.
The lesson, De Mare says, is that grow machinery gross sales could meet for days - even out if ingrain prices bounce because of risky endure or former changes in add.
Some argue, however, the pessimists are untimely.
"Yes, the next few years are going to be ugly," says Michael Kon, a elder equities psychoanalyst at the Golub Group, a California investment unwaveringly that recently took a back in Deere.
"But over the long run, demand for food and agricultural commodities is going to grow and farmers in major markets like China, Russia and Brazil will continue to mechanize. Machinery manufacturers will benefit from both those trends."
In the meantime, though, growers stay on to cluster to showrooms lured by what Deutschmark Nelson, who grows corn, soybeans and wheat berry on 2,000 acres in Kansas, characterizes as "shocking" bargains on victimised equipment.
Earlier this month, Horatio Nelson traded in his Deere unite with 1,000 hours on it for unitary with scarce 400 hours on it. The departure in terms between the deuce machines was but terminated $100,000 - and the bargainer offered to bring Admiral Nelson that core interest-gratuitous through with 2017.
"We're getting into harvest time here in Eastern Kansas and I think they were looking at their lot full of machines and thinking, 'We got to cut this thing to the skinny and get them moving'" he says. (Redaction by Jacques Louis David Greising and Tomasz Janowski)
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