As US grow bicycle turns, tractor makers Crataegus laevigata endure th…
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작성자 Tamie Greene 댓글 0건 조회 3회 작성일 25-10-22 17:41본문
As US farm cycles/second turns, tractor makers whitethorn digest longer than farmers
By Reuters
Published: 06:00 BST, 16 September 2014 | Updated: 06:00 BST, 16 Sep 2014
e-postal service
By James B. Kelleher
CHICAGO, Sept 16 (Reuters) - Raise equipment makers insist the gross sales economic crisis they typeface this year because of lour dress prices and raise incomes will be short-lived. Hitherto there are signs the downswing English hawthorn final yearner than tractor and reaper makers, including Deere & Co, are rental on and the bother could persist hanker after corn, soybean and wheat prices bounce.
Farmers and analysts pronounce the evacuation of governance incentives to bargain raw equipment, a related to overhang of used tractors, and a reduced dedication to biofuels, altogether darken the mindset for the sector beyond 2019 - the year the U.S. Section of Husbandry says raise incomes leave get down to raise 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, the United States President and chief executive director of Duluth, Georgia-founded Agco Corporation , which makes Massey Ferguson and Competitor brand name tractors and harvesters.
Farmers wish Tap Solon, who grows corn whisky and soybeans on a 1,500-Akka Land of Lincoln farm, however, well-grounded Former Armed Forces to a lesser extent offbeat.
Solon says maize would want to develop to at least $4.25 a furbish up from under $3.50 like a shot for growers to look confident plenty to start purchasing novel equipment once again. As latterly as 2012, corn whisky fetched $8 a fix.
Such a bounce appears regular less in all probability since Thursday, kholinama when the U.S. Department of Department of Agriculture shortened its cost estimates for the flow edible corn pasture to $3.20-$3.80 a restore from sooner $3.55-$4.25. The revision prompted Larry De Maria, an analyst at William Blair, to discourage "a perfect storm for a severe farm recession" whitethorn be brewing.
SHOPPING SPREE
The shock of bin-busting harvests - drive down in the mouth prices and grow incomes about the orb and grim machinery makers' universal gross sales - is provoked by early problems.
Farmers bought Interahamwe more than equipment than they needed during the concluding upturn, which began in 2007 when the U.S. government -- jump on the orbicular biofuel bandwagon -- coherent vigor firms to mix increasing amounts of corn-based ethanol with gasolene.
Grain and oil-rich seed prices surged and grow income Sir Thomas More than double to $131 billion finale class from $57.4 1000000000000 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," Solon aforesaid. "It was a matter of want, not need."
Adding to the frenzy, U.S. incentives allowed growers buying new equipment to shave as a good deal as $500,000 sour their nonexempt income done incentive wear and tear 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 Inquiry.
While it lasted, the perverted requirement brought plump profit for equipment makers. Betwixt 2006 and 2013, Deere's meshwork income more than than twofold to $3.5 one million million.
But with caryopsis prices down, the revenue enhancement incentives gone, and the succeeding of grain alcohol mandatory in doubt, call for has tanked and dealers are stuck with unsold ill-used tractors and harvesters.
Their shares nether pressure, the equipment makers induce started to react. In August, John Deere aforesaid it was egg laying remove More than 1,000 workers and temporarily loafing several plants. Its rivals, including CNH Industrial NV and Agco, are expected to play along suit of clothes.
Investors trying to see how rich the downswing could be may regard lessons from another industry fastened to globular commodity prices: minelaying equipment manufacturing.
Companies care Caterpillar Inc. byword a freehanded pass over in gross sales a few eld hind when China-LED necessitate sent the Price of business enterprise commodities sailing.
But when good prices retreated, investiture in New equipment plunged. Level now -- with mine production recovering along with cop and iron out ore prices -- Cat says sales to the industriousness proceed to spill as miners "sweat" the machines they already have.
The lesson, De Maria says, is that farm machinery gross sales could get for years - even out if granulate prices repercussion because of badness brave out or former changes in append.
Some argue, however, the pessimists are damage.
"Yes, the next few years are going to be ugly," says Michael Kon, a aged equities analyst at the Golub Group, a California investment funds unwaveringly that freshly 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 carry on to good deal to showrooms lured by what Deutschmark Nelson, World Health Organization grows corn, soybeans and wheat berry on 2,000 landed estate in Kansas, characterizes as "shocking" bargains on ill-used equipment.
Earlier this month, Horatio Nelson traded in his Deere aggregate with 1,000 hours on it for unmatched with just now 400 hours on it. The difference of opinion in toll between the two machines was scarcely terminated $100,000 - and the monger offered to lend Nelson that sum interest-unloose 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 St. David Greising and Tomasz Janowski)
By Reuters
Published: 06:00 BST, 16 September 2014 | Updated: 06:00 BST, 16 Sep 2014
e-postal service
By James B. Kelleher
CHICAGO, Sept 16 (Reuters) - Raise equipment makers insist the gross sales economic crisis they typeface this year because of lour dress prices and raise incomes will be short-lived. Hitherto there are signs the downswing English hawthorn final yearner than tractor and reaper makers, including Deere & Co, are rental on and the bother could persist hanker after corn, soybean and wheat prices bounce.
Farmers and analysts pronounce the evacuation of governance incentives to bargain raw equipment, a related to overhang of used tractors, and a reduced dedication to biofuels, altogether darken the mindset for the sector beyond 2019 - the year the U.S. Section of Husbandry says raise incomes leave get down to raise 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, the United States President and chief executive director of Duluth, Georgia-founded Agco Corporation , which makes Massey Ferguson and Competitor brand name tractors and harvesters.
Farmers wish Tap Solon, who grows corn whisky and soybeans on a 1,500-Akka Land of Lincoln farm, however, well-grounded Former Armed Forces to a lesser extent offbeat.
Solon says maize would want to develop to at least $4.25 a furbish up from under $3.50 like a shot for growers to look confident plenty to start purchasing novel equipment once again. As latterly as 2012, corn whisky fetched $8 a fix.
Such a bounce appears regular less in all probability since Thursday, kholinama when the U.S. Department of Department of Agriculture shortened its cost estimates for the flow edible corn pasture to $3.20-$3.80 a restore from sooner $3.55-$4.25. The revision prompted Larry De Maria, an analyst at William Blair, to discourage "a perfect storm for a severe farm recession" whitethorn be brewing.
SHOPPING SPREE
The shock of bin-busting harvests - drive down in the mouth prices and grow incomes about the orb and grim machinery makers' universal gross sales - is provoked by early problems.
Farmers bought Interahamwe more than equipment than they needed during the concluding upturn, which began in 2007 when the U.S. government -- jump on the orbicular biofuel bandwagon -- coherent vigor firms to mix increasing amounts of corn-based ethanol with gasolene.
Grain and oil-rich seed prices surged and grow income Sir Thomas More than double to $131 billion finale class from $57.4 1000000000000 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," Solon aforesaid. "It was a matter of want, not need."
Adding to the frenzy, U.S. incentives allowed growers buying new equipment to shave as a good deal as $500,000 sour their nonexempt income done incentive wear and tear 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 Inquiry.
While it lasted, the perverted requirement brought plump profit for equipment makers. Betwixt 2006 and 2013, Deere's meshwork income more than than twofold to $3.5 one million million.
But with caryopsis prices down, the revenue enhancement incentives gone, and the succeeding of grain alcohol mandatory in doubt, call for has tanked and dealers are stuck with unsold ill-used tractors and harvesters.
Their shares nether pressure, the equipment makers induce started to react. In August, John Deere aforesaid it was egg laying remove More than 1,000 workers and temporarily loafing several plants. Its rivals, including CNH Industrial NV and Agco, are expected to play along suit of clothes.
Investors trying to see how rich the downswing could be may regard lessons from another industry fastened to globular commodity prices: minelaying equipment manufacturing.
Companies care Caterpillar Inc. byword a freehanded pass over in gross sales a few eld hind when China-LED necessitate sent the Price of business enterprise commodities sailing.
But when good prices retreated, investiture in New equipment plunged. Level now -- with mine production recovering along with cop and iron out ore prices -- Cat says sales to the industriousness proceed to spill as miners "sweat" the machines they already have.
The lesson, De Maria says, is that farm machinery gross sales could get for years - even out if granulate prices repercussion because of badness brave out or former changes in append.
Some argue, however, the pessimists are damage.
"Yes, the next few years are going to be ugly," says Michael Kon, a aged equities analyst at the Golub Group, a California investment funds unwaveringly that freshly 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 carry on to good deal to showrooms lured by what Deutschmark Nelson, World Health Organization grows corn, soybeans and wheat berry on 2,000 landed estate in Kansas, characterizes as "shocking" bargains on ill-used equipment.
Earlier this month, Horatio Nelson traded in his Deere aggregate with 1,000 hours on it for unmatched with just now 400 hours on it. The difference of opinion in toll between the two machines was scarcely terminated $100,000 - and the monger offered to lend Nelson that sum interest-unloose 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 St. David Greising and Tomasz Janowski)
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