Deere slumps as trade war darkens outlook for top tractor maker
The US-China trade war is taking a toll on the world's biggest maker of tractors as Deere & Co is no longer 'cautiously optimistic' about the future, reports Bloomberg
The US-China trade war is taking a toll on the world's biggest maker of tractors as Deere & Co is no longer 'cautiously optimistic' about the future, reports Bloomberg.
'Ongoing concerns about export-market access, near-term demand for commodities such as soybeans, and a delayed planting season in much of North America are causing farmers to become much more cautious about making major purchases,' said Deere CEO Sam Allen.
The Moline, Illinois-based company now expect revenues for fiscal 2019 to increase five per cent with net profit coming in at US$3.3 billion, having previously set a seven per cent sales growth goal and net income of about $3.6 billion.
Demand for soybeans used in feed is expected to take a hit from the spread of African swine fever in China. All that has prompted analysts including JPMorgan Chase & Co to cut their recommendations.
It's 'not terribly surprising given the trade backdrop, the lack of visibility and what appears to be unrelenting wave of headwinds on the horizon' that the company 'pretty much cut their 2019 outlook across the board,' said Chris Ciolino, an analyst at Bloomberg Intelligence.