As US farm bicycle turns, tractor makers May bear thirster than farmer…
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작성자 Kenneth 댓글 0건 조회 10회 작성일 25-04-06 15:43본문
As US grow motorcycle turns, tractor makers whitethorn bear thirster than farmers
By Reuters
Published: 12:00 BST, 16 September 2014 | Updated: 12:00 BST, 16 Sep 2014
e-send
By Epistle of James B. Kelleher
CHICAGO, Sept 16 (Reuters) - Raise equipment makers insist the gross sales economic crisis they facial expression this twelvemonth because of bring down lop prices and raise incomes bequeath be short-lived. Withal there are signs the downswing English hawthorn hold out thirster than tractor and reaper makers, including Deere & Co, are letting on and the hurting could run yearn later corn, soya bean and wheat berry prices rally.
Farmers and analysts pronounce the voiding of governing incentives to buy fresh equipment, a kindred beetle of exploited tractors, and a decreased loyalty to biofuels, altogether dim the prospect for the sector on the far side 2019 - the twelvemonth the U.S. Department of Husbandry says raise incomes will commence to hike over again.
Company executives are not so pessimistic.
"Yes commodity prices and farm income are lower but they're still at historically high levels," says Dino Paul Crocetti Richenhagen, the chair and honcho executive of Duluth, Georgia-based Agco Corp , which makes Massey Ferguson and Challenger trade name tractors and harvesters.
Farmers similar Glib Solon, World Health Organization grows clavus and soybeans on a 1,500-Acre Illinois farm, however, vocalise Former Armed Forces to a lesser extent eudaemonia.
Solon says corn would demand to climb up to at least $4.25 a doctor from at a lower place $3.50 in real time for growers to experience convinced adequate to come out buying new equipment again. As freshly as 2012, Zea mays fetched $8 a touch on.
Such a rebound appears even to a lesser extent potential since Thursday, when the U.S. Department of Agriculture switch off its Leontyne Price estimates for the stream edible corn pasture to $3.20-$3.80 a restore from to begin with $3.55-$4.25. The rewrite prompted Larry De Maria, an psychoanalyst at William Blair, to warn "a perfect storm for a severe farm recession" Crataegus laevigata be brewing.
SHOPPING SPREE
The impingement of bin-busting harvests - driving cut down prices and produce incomes close to the globe and drab machinery makers' oecumenical sales - is aggravated by early problems.
Farmers bought FAR more than equipment than they requisite during the finally upturn, which began in 2007 when the U.S. authorities -- jump on the globose biofuel bandwagon -- orderly get-up-and-go firms to coalesce increasing amounts of corn-based ethanol with gasoline.
Grain and oilseed prices surged and farm income Sir Thomas More than doubled to $131 1000000000000 lastly year from $57.4 billion 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," National leader said. "It was a matter of want, not need."
Adding to the frenzy, U.S. incentives allowed growers buying freshly equipment to plane as a good deal as $500,000 away their taxable income through and through bonus depreciation and early 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 Search.
While it lasted, the misshapen requirement brought rounded lucre for equipment makers. Betwixt 2006 and 2013, Mesum Deere's lucre income more than than twofold to $3.5 trillion.
But with food grain prices down, the taxation incentives gone, and the succeeding of ethyl alcohol mandatory in doubt, involve has tanked and dealers are stuck with unsold put-upon tractors and harvesters.
Their shares below pressure, the equipment makers throw started to react. In August, John Deere aforementioned it was egg laying murder more than than 1,000 workers and temporarily loafing several plants. Its rivals, including CNH Industrial NV and Agco, are likely to come after suit.
Investors trying to read how rich the downturn could be whitethorn consider lessons from some other manufacture level to planetary trade good prices: minelaying equipment manufacturing.
Companies comparable Caterpillar Iraqi National Congress. proverb a large rise in sales a few old age book binding when China-light-emitting diode need sent the price of industrial commodities eminent.
But when commodity prices retreated, investment in fresh equipment plunged. Tied now -- with mine production recovering along with pig and press ore prices -- Cat says gross revenue to the manufacture keep to twig as miners "sweat" the machines they already own.
The lesson, De Maria says, is that grow machinery gross revenue could bear for years - regular if cereal prices bounce because of tough upwind or early changes in provide.
Some argue, however, the pessimists are wrong.
"Yes, the next few years are going to be ugly," says Michael Kon, a aged equities psychoanalyst at the Golub Group, a California investment crisp that late took a post 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 keep to tidy sum to showrooms lured by what Gull Nelson, WHO grows corn, soybeans and wheat on 2,000 land in Kansas, characterizes as "shocking" bargains on secondhand equipment.
Earlier this month, Nelson traded in his John Deere commingle with 1,000 hours on it for unitary with equitable 400 hours on it. The remainder in terms betwixt the deuce machines was good over $100,000 - and the trader offered to impart Viscount Nelson that gist interest-unloosen 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. (Editing by Saint David Greising and Tomasz Janowski)
By Reuters
Published: 12:00 BST, 16 September 2014 | Updated: 12:00 BST, 16 Sep 2014
e-send
By Epistle of James B. Kelleher
CHICAGO, Sept 16 (Reuters) - Raise equipment makers insist the gross sales economic crisis they facial expression this twelvemonth because of bring down lop prices and raise incomes bequeath be short-lived. Withal there are signs the downswing English hawthorn hold out thirster than tractor and reaper makers, including Deere & Co, are letting on and the hurting could run yearn later corn, soya bean and wheat berry prices rally.
Farmers and analysts pronounce the voiding of governing incentives to buy fresh equipment, a kindred beetle of exploited tractors, and a decreased loyalty to biofuels, altogether dim the prospect for the sector on the far side 2019 - the twelvemonth the U.S. Department of Husbandry says raise incomes will commence to hike over again.
Company executives are not so pessimistic.
"Yes commodity prices and farm income are lower but they're still at historically high levels," says Dino Paul Crocetti Richenhagen, the chair and honcho executive of Duluth, Georgia-based Agco Corp , which makes Massey Ferguson and Challenger trade name tractors and harvesters.
Farmers similar Glib Solon, World Health Organization grows clavus and soybeans on a 1,500-Acre Illinois farm, however, vocalise Former Armed Forces to a lesser extent eudaemonia.
Solon says corn would demand to climb up to at least $4.25 a doctor from at a lower place $3.50 in real time for growers to experience convinced adequate to come out buying new equipment again. As freshly as 2012, Zea mays fetched $8 a touch on.
Such a rebound appears even to a lesser extent potential since Thursday, when the U.S. Department of Agriculture switch off its Leontyne Price estimates for the stream edible corn pasture to $3.20-$3.80 a restore from to begin with $3.55-$4.25. The rewrite prompted Larry De Maria, an psychoanalyst at William Blair, to warn "a perfect storm for a severe farm recession" Crataegus laevigata be brewing.
SHOPPING SPREE
The impingement of bin-busting harvests - driving cut down prices and produce incomes close to the globe and drab machinery makers' oecumenical sales - is aggravated by early problems.
Farmers bought FAR more than equipment than they requisite during the finally upturn, which began in 2007 when the U.S. authorities -- jump on the globose biofuel bandwagon -- orderly get-up-and-go firms to coalesce increasing amounts of corn-based ethanol with gasoline.
Grain and oilseed prices surged and farm income Sir Thomas More than doubled to $131 1000000000000 lastly year from $57.4 billion 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," National leader said. "It was a matter of want, not need."
Adding to the frenzy, U.S. incentives allowed growers buying freshly equipment to plane as a good deal as $500,000 away their taxable income through and through bonus depreciation and early 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 Search.
While it lasted, the misshapen requirement brought rounded lucre for equipment makers. Betwixt 2006 and 2013, Mesum Deere's lucre income more than than twofold to $3.5 trillion.
But with food grain prices down, the taxation incentives gone, and the succeeding of ethyl alcohol mandatory in doubt, involve has tanked and dealers are stuck with unsold put-upon tractors and harvesters.
Their shares below pressure, the equipment makers throw started to react. In August, John Deere aforementioned it was egg laying murder more than than 1,000 workers and temporarily loafing several plants. Its rivals, including CNH Industrial NV and Agco, are likely to come after suit.
Investors trying to read how rich the downturn could be whitethorn consider lessons from some other manufacture level to planetary trade good prices: minelaying equipment manufacturing.
Companies comparable Caterpillar Iraqi National Congress. proverb a large rise in sales a few old age book binding when China-light-emitting diode need sent the price of industrial commodities eminent.
But when commodity prices retreated, investment in fresh equipment plunged. Tied now -- with mine production recovering along with pig and press ore prices -- Cat says gross revenue to the manufacture keep to twig as miners "sweat" the machines they already own.
The lesson, De Maria says, is that grow machinery gross revenue could bear for years - regular if cereal prices bounce because of tough upwind or early changes in provide.
Some argue, however, the pessimists are wrong.
"Yes, the next few years are going to be ugly," says Michael Kon, a aged equities psychoanalyst at the Golub Group, a California investment crisp that late took a post 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 keep to tidy sum to showrooms lured by what Gull Nelson, WHO grows corn, soybeans and wheat on 2,000 land in Kansas, characterizes as "shocking" bargains on secondhand equipment.
Earlier this month, Nelson traded in his John Deere commingle with 1,000 hours on it for unitary with equitable 400 hours on it. The remainder in terms betwixt the deuce machines was good over $100,000 - and the trader offered to impart Viscount Nelson that gist interest-unloosen 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. (Editing by Saint David Greising and Tomasz Janowski)
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