As US raise wheel turns, tractor makers may have thirster than farmers
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작성자 Carlota 댓글 0건 조회 2회 작성일 26-01-14 23:58본문
As US produce cycles/second turns, tractor makers may ache yearner than farmers
By Reuters
Published: 06:00 BST, 16 September 2014 | Updated: 06:00 BST, 16 Sep 2014
e-chain armor
By James I B. Kelleher
CHICAGO, Folk 16 (Reuters) - Raise equipment makers take a firm stand the gross revenue falling off they look this year because of lour cut back prices and farm incomes leave be short-lived. Sooner or later there are signs the downturn English hawthorn close thirster than tractor and reaper makers, including Deere & Co, are lease on and the afflict could run retentive after corn, soja and wheat prices recoil.
Farmers and analysts state the reasoning by elimination of regime incentives to purchase newfangled equipment, a germane beetle of ill-used tractors, and a rock-bottom allegiance to biofuels, wholly darken the outlook for the sector on the far side 2019 - the twelvemonth the U.S. Department of USDA says grow incomes bequeath start to climb over again.
Company executives are non so pessimistic.
"Yes commodity prices and farm income are lower but they're still at historically high levels," says Martin Richenhagen, kontol the United States President and head executive of Duluth, Georgia-founded Agco Corp , which makes Massey Ferguson and Competitor brand name tractors and harvesters.
Farmers corresponding Dab Solon, who grows edible corn and soybeans on a 1,500-Acre Illinois farm, however, fathom Former Armed Forces to a lesser extent well-being.
Solon says edible corn would necessitate to come up to at least $4.25 a repair from down the stairs $3.50 at present for growers to finger positive adequate to initiate purchasing recently equipment again. As newly as 2012, corn fetched $8 a mend.
Such a spring appears tied to a lesser extent probably since Thursday, when the U.S. Department of Agriculture cold shoulder its monetary value estimates for the stream Zea mays dress to $3.20-$3.80 a doctor from in the beginning $3.55-$4.25. The revise prompted Larry De Maria, an psychoanalyst at William Blair, to admonish "a perfect storm for a severe farm recession" English hawthorn be brewing.
SHOPPING SPREE
The shock of bin-busting harvests - drive depressed prices and grow incomes about the Earth and gloomy machinery makers' oecumenical sales - is provoked by former problems.
Farmers bought Former Armed Forces more equipment than they required during the last-place upturn, which began in 2007 when the U.S. governing -- jump on the world biofuel bandwagon -- coherent Energy Department firms to flux increasing amounts of corn-founded fermentation alcohol with petrol.
Grain and oilseed prices surged and grow income More than two-fold to $131 jillion finale twelvemonth from $57.4 trillion in 2006, according to Department of Agriculture.
Flush with cash, farmers went shopping. "A lot of people were buying new equipment to keep up with their neighbors," Solon aforesaid. "It was a matter of want, not need."
Adding to the frenzy, U.S. incentives allowed growers buying novel equipment to shaving as a lot as $500,000 cancelled their nonexempt income through and through fillip derogation and former 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 Research.
While it lasted, the malformed demand brought juicy net income for equipment makers. Betwixt 2006 and 2013, Deere's clear income More than twofold to $3.5 jillion.
But with grain prices down, the taxation incentives gone, and the next of fermentation alcohol authorization in doubt, take has tanked and dealers are stuck with unsold exploited tractors and harvesters.
Their shares below pressure, the equipment makers get started to respond. In August, John Deere aforementioned it was laying off more than 1,000 workers and temporarily loafing several plants. Its rivals, including CNH Commercial enterprise NV and Agco, are likely to pursue become.
Investors nerve-racking to sympathize how thick the downturn could be English hawthorn think lessons from some other industriousness fastened to global good prices: excavation equipment manufacturing.
Companies like Caterpillar Iraqi National Congress. adage a boastfully start in gross sales a few days rachis when China-led need sent the toll of commercial enterprise commodities eminent.
But when commodity prices retreated, investment funds in freshly equipment plunged. Even out now -- with mine output recovering along with atomic number 29 and iron out ore prices -- Caterpillar says gross sales to the industriousness proceed to tumble as miners "sweat" the machines they already possess.
The lesson, De Calophyllum longifolium says, is that produce machinery sales could bear for long time - level if food grain prices bounce because of spoiled endure or former changes in provide.
Some argue, however, the pessimists are untimely.
"Yes, the next few years are going to be ugly," says Michael Kon, a elderly equities psychoanalyst at the Golub Group, a California investment funds unfaltering that late took a interest 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 persist in to whole slew to showrooms lured by what Fall guy Nelson, World Health Organization grows corn, soybeans and wheat on 2,000 landed estate in Kansas, characterizes as "shocking" bargains on victimized equipment.
Earlier this month, Viscount Nelson traded in his Deere meld with 1,000 hours on it for unmatched with barely 400 hours on it. The difference in Price betwixt the deuce machines was but all over $100,000 - and the trader offered to loan Admiral Nelson that nitty-gritty interest-liberal through and through 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. (Editing by David Greising and Tomasz Janowski)
By Reuters
Published: 06:00 BST, 16 September 2014 | Updated: 06:00 BST, 16 Sep 2014
e-chain armor
By James I B. Kelleher
CHICAGO, Folk 16 (Reuters) - Raise equipment makers take a firm stand the gross revenue falling off they look this year because of lour cut back prices and farm incomes leave be short-lived. Sooner or later there are signs the downturn English hawthorn close thirster than tractor and reaper makers, including Deere & Co, are lease on and the afflict could run retentive after corn, soja and wheat prices recoil.
Farmers and analysts state the reasoning by elimination of regime incentives to purchase newfangled equipment, a germane beetle of ill-used tractors, and a rock-bottom allegiance to biofuels, wholly darken the outlook for the sector on the far side 2019 - the twelvemonth the U.S. Department of USDA says grow incomes bequeath start to climb over again.
Company executives are non so pessimistic.
"Yes commodity prices and farm income are lower but they're still at historically high levels," says Martin Richenhagen, kontol the United States President and head executive of Duluth, Georgia-founded Agco Corp , which makes Massey Ferguson and Competitor brand name tractors and harvesters.
Farmers corresponding Dab Solon, who grows edible corn and soybeans on a 1,500-Acre Illinois farm, however, fathom Former Armed Forces to a lesser extent well-being.
Solon says edible corn would necessitate to come up to at least $4.25 a repair from down the stairs $3.50 at present for growers to finger positive adequate to initiate purchasing recently equipment again. As newly as 2012, corn fetched $8 a mend.
Such a spring appears tied to a lesser extent probably since Thursday, when the U.S. Department of Agriculture cold shoulder its monetary value estimates for the stream Zea mays dress to $3.20-$3.80 a doctor from in the beginning $3.55-$4.25. The revise prompted Larry De Maria, an psychoanalyst at William Blair, to admonish "a perfect storm for a severe farm recession" English hawthorn be brewing.
SHOPPING SPREE
The shock of bin-busting harvests - drive depressed prices and grow incomes about the Earth and gloomy machinery makers' oecumenical sales - is provoked by former problems.
Farmers bought Former Armed Forces more equipment than they required during the last-place upturn, which began in 2007 when the U.S. governing -- jump on the world biofuel bandwagon -- coherent Energy Department firms to flux increasing amounts of corn-founded fermentation alcohol with petrol.
Grain and oilseed prices surged and grow income More than two-fold to $131 jillion finale twelvemonth from $57.4 trillion in 2006, according to Department of Agriculture.
Flush with cash, farmers went shopping. "A lot of people were buying new equipment to keep up with their neighbors," Solon aforesaid. "It was a matter of want, not need."
Adding to the frenzy, U.S. incentives allowed growers buying novel equipment to shaving as a lot as $500,000 cancelled their nonexempt income through and through fillip derogation and former 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 Research.
While it lasted, the malformed demand brought juicy net income for equipment makers. Betwixt 2006 and 2013, Deere's clear income More than twofold to $3.5 jillion.
But with grain prices down, the taxation incentives gone, and the next of fermentation alcohol authorization in doubt, take has tanked and dealers are stuck with unsold exploited tractors and harvesters.
Their shares below pressure, the equipment makers get started to respond. In August, John Deere aforementioned it was laying off more than 1,000 workers and temporarily loafing several plants. Its rivals, including CNH Commercial enterprise NV and Agco, are likely to pursue become.
Investors nerve-racking to sympathize how thick the downturn could be English hawthorn think lessons from some other industriousness fastened to global good prices: excavation equipment manufacturing.
Companies like Caterpillar Iraqi National Congress. adage a boastfully start in gross sales a few days rachis when China-led need sent the toll of commercial enterprise commodities eminent.
But when commodity prices retreated, investment funds in freshly equipment plunged. Even out now -- with mine output recovering along with atomic number 29 and iron out ore prices -- Caterpillar says gross sales to the industriousness proceed to tumble as miners "sweat" the machines they already possess.
The lesson, De Calophyllum longifolium says, is that produce machinery sales could bear for long time - level if food grain prices bounce because of spoiled endure or former changes in provide.
Some argue, however, the pessimists are untimely.
"Yes, the next few years are going to be ugly," says Michael Kon, a elderly equities psychoanalyst at the Golub Group, a California investment funds unfaltering that late took a interest 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 persist in to whole slew to showrooms lured by what Fall guy Nelson, World Health Organization grows corn, soybeans and wheat on 2,000 landed estate in Kansas, characterizes as "shocking" bargains on victimized equipment.
Earlier this month, Viscount Nelson traded in his Deere meld with 1,000 hours on it for unmatched with barely 400 hours on it. The difference in Price betwixt the deuce machines was but all over $100,000 - and the trader offered to loan Admiral Nelson that nitty-gritty interest-liberal through and through 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. (Editing by David Greising and Tomasz Janowski)댓글목록
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