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US soybean farmers, deserted by big buyer China, scramble for other importers
Yahoo Finance· 2025-10-03 16:22
After months of work that included planting seeds, fertilizing fields and spraying weedkillers, Illinois growers on average are facing losses of up to $64 per acre this year, thanks in part to low crop prices and weak exports, according to University of Illinois estimates.About 60 miles (97 km) west of Chicago, where the city and suburbs start to give way to green fields, farmer Ryan Frieders, 49, will be storing much of his beans in bins after previously selling some of his expected harvest at prices below ...
DE or AGCO: Which Farm Equipment Stock Offers Better Upside Now?
ZACKS· 2025-09-16 16:51
Core Insights - Deere & Company and AGCO Corporation are prominent players in the agricultural machinery industry, both investing in advanced technologies like precision agriculture and smart farming solutions [1][2] - Both companies are positioned to benefit from long-term trends such as rising food demand and sustainable farming practices, but face challenges due to weakened farmer sentiment stemming from lower commodity prices and higher costs [2][22] Deere & Company - Deere has a market capitalization of $127 billion and specializes in agricultural, forestry, and turf equipment, with a strong focus on precision farming technology [4] - The company has experienced declining revenues for eight consecutive quarters and expects a continued decline in fiscal 2025, particularly in the large agriculture equipment market, projected to drop by 30% [5][6] - Net income for fiscal 2025 is anticipated to be between $4.75 billion and $5.25 billion, significantly lower than the $7.1 billion reported in fiscal 2024 [7] - Deere is managing production levels and cutting costs to maintain margins, while focusing on innovation and geographic expansion to drive long-term growth [8] - Recent acquisitions, such as GUSS Automation, aim to enhance competitive edge through advanced technology [9] AGCO Corporation - AGCO has a market capitalization of approximately $8.2 billion and offers a range of agricultural machinery and precision agriculture technology [10] - The company has also seen declining revenues and earnings for seven consecutive quarters, with a revised net sales guidance of $9.8 billion for 2025, indicating a 15.5% year-over-year decline [11] - In North America, AGCO expects a 25-30% decline in sales volumes of large agricultural equipment and a 5% decline in small agricultural equipment [12] - AGCO is implementing aggressive production cuts and restructuring actions to focus on core agricultural equipment [12] - The company continues to invest in premium technology and sustainable farming solutions to enhance product offerings and improve margins [13][14] Financial Comparisons - The Zacks Consensus Estimate for Deere's fiscal 2025 earnings is $18.58 per share, reflecting a 27.6% year-over-year decline, while AGCO's estimate is $4.77 per share, indicating a 36.4% decline [15] - Year-to-date, AGCO shares have increased by 17.4%, outperforming Deere's 10.8% gain [17] - AGCO trades at a lower forward earnings multiple of 18.20X compared to Deere's 22.84X, making AGCO more attractive from a valuation perspective [19][23]
X @The Economist
The Economist· 2025-08-17 10:45
Industry Trend - High-end products, including cars, phones, and tractors, are increasingly stolen [1] - These stolen goods are being trafficked to serve distant markets [1]
John Deere(DE) - 2025 Q3 - Earnings Call Transcript
2025-08-14 15:02
Financial Data and Key Metrics Changes - Net sales and revenues decreased by 9% to DKK 12.018 billion, with equipment operations net sales also down 9% to DKK 10.357 billion [10] - Net income attributable to Deere and Company was €1.289 billion, or $4.75 per diluted share [10] Business Segment Data and Key Metrics Changes - Production and Precision Ag segment net sales fell 16% year over year to €4.273 billion, primarily due to lower shipment volumes and unfavorable price realization [10][11] - Small Ag and Turf segment net sales decreased by 1% year over year to €3.025 billion, with operating profit declining slightly to €485 million, resulting in a 16% operating margin [12] - Construction and Forestry segment net sales were down 5% year over year to DKK 3.059 billion, with an operating profit of €237 million and a 7.7% operating margin [19][20] Market Data and Key Metrics Changes - In the U.S. and Canada, large ag equipment industry sales are expected to decline approximately 30% in fiscal year 2025 due to high interest rates and elevated used inventory levels [13] - Small ag and turf industry demand in the U.S. and Canada is projected to decrease by 10% [14] - European market sentiment is improving, with expectations for industry sales to be flat to down 5% in fiscal year 2025 [15] Company Strategy and Development Direction - The company is focused on disciplined execution amidst challenging market dynamics, with a strong emphasis on managing production costs and inventory levels [6][8] - Deere is positioning itself to respond effectively to market demand inflections, having reduced inventories significantly across all business segments [29][32] - The company is investing in technology and precision agriculture solutions to drive future growth and improve customer outcomes [59][110] Management's Comments on Operating Environment and Future Outlook - Management noted that global uncertainty and high interest rates are impacting customer sentiment, leading to cautious capital purchases [28] - Despite challenges, there are signs of optimism in certain markets, with improved retail sales and order activity in specific segments [9][44] - The company remains committed to delivering long-term value for customers and shareholders, leveraging its operational efficiencies and market position [67][68] Other Important Information - Tariff costs in the quarter were approximately $200 million, with a forecasted pretax impact of nearly $600 million for fiscal year 2025 [37][38] - The company has seen a positive response to pricing actions taken in the North American earthmoving market, with retail settlements up mid-single digits year over year [39] Q&A Session Summary Question: Can you provide additional color on the quarter's performance? - Management highlighted the challenges posed by global trade dynamics and interest rate expectations, emphasizing the importance of focusing on controllable factors like production and inventory management [28] Question: What are the expectations for production in relation to retail demand next year? - Management indicated that production is expected to align closely with retail demand, particularly in large ag, while small ag and turf may see some lift due to underproduction this year [75] Question: Can you elaborate on the early order programs and their trends? - Management noted that while there is caution in ordering due to market uncertainty, early returns on planters and combines are positive, though it is still early in the programs [81][82] Question: How is the company addressing pricing competition in the market? - Management acknowledged the competitive pricing environment but expressed optimism about the market's ability to bear higher pricing, especially with positive retail sales trends [86] Question: What is the outlook for cash flow guidance? - Management explained that the cash flow guidance remains unchanged due to the uncertain environment, but they feel confident about inventory levels and retail sales trends [94]
John Deere(DE) - 2025 Q3 - Earnings Call Presentation
2025-08-14 14:00
3Q 2025 Financial Performance - Net sales and revenues increased by 9% from $12.018 billion in 3Q 2024 to $13.152 billion in 3Q 2025[7] - Net sales for Equipment Operations increased by 9% from $10.357 billion in 3Q 2024 to $11.387 billion in 3Q 2025[7] - Net income attributable to Deere & Company decreased by 26% from $1.734 billion in 3Q 2024 to $1.289 billion in 3Q 2025[7] - Diluted EPS decreased by 24% from $6.29 per share in 3Q 2024 to $4.75 per share in 3Q 2025[7] Segment Performance - Production and Precision Ag net sales decreased by 16% from $5.099 billion in 3Q 2024 to $4.273 billion in 3Q 2025[9] - Small Ag and Turf net sales slightly decreased by 1% from $3.053 billion in 3Q 2024 to $3.025 billion in 3Q 2025[11] - Construction and Forestry net sales decreased by 5% from $3.235 billion in 3Q 2024 to $3.059 billion in 3Q 2025[22] - Financial Services net income increased from $153 million in 3Q 2024 to $205 million in 3Q 2025[30] FY 2025 Outlook - The company forecasts a net income attributable to Deere & Co of $4.75-5.25 billion[32] - The company anticipates net operating cash flow of $4.5-5.5 billion[32]
CNH Industrial N.V.(CNH) - 2025 Q2 - Earnings Call Presentation
2025-08-01 13:00
Financial Performance - Consolidated revenues decreased by 14% year-over-year to $4.7 billion[10] - Net sales for Industrial Activities decreased by 16% year-over-year to $4.0 billion[10] - Adjusted EBIT for Industrial Activities decreased by 55% year-over-year to $224 million[10] - Net income decreased by 46% year-over-year to $217 million[10] - Adjusted diluted EPS decreased by $0.18 year-over-year to $0.17[10] Segment Performance - Agriculture net sales decreased by 17% year-over-year to $3.248 billion, with adjusted EBIT decreasing to $263 million[21] - Construction net sales decreased by 13% year-over-year to $773 million, with adjusted EBIT decreasing to $35 million[24] - Financial Services retail originations decreased by $0.2 billion year-over-year to $2.7 billion, while the managed portfolio increased by $0.2 billion year-over-year to $28.7 billion[27] Outlook - The company reaffirmed its 2025 outlook for Industrial Activities, including net sales decreasing by 11% year-over-year from $17.1 billion, adjusted EBIT margin between 4.5% and 6.5%, and free cash flow between $0.1 billion and $0.5 billion[38] - The company also reaffirmed its 2025 outlook for adjusted diluted EPS between $0.50 and $0.70[38] Other Highlights - Production hours decreased by 12% year-over-year to reduce dealer inventory[8] - The company announced a collaboration with Starlink to expand connectivity for CNH customers[8]
Guests of the Shanghai Cooperation Organization Media and Think Tank Summit Visit Luoyang: Embracing the Dynamic Pulse of a Millennia-Old Ancient Capital
Globenewswire· 2025-08-01 05:09
Group 1 - Luoyang is a significant historical city with over 5,000 years of civilization and nearly 4,000 years of urban history, serving as an ancient capital for thirteen dynasties and a key point on the Silk Road [2] - The city is recognized as an important traditional industrial base in China, with seven of 156 key national projects launched during the first Five-Year Plan [2] - Luoyang is actively integrating into the Belt and Road Initiative, with continuous operation of China-Europe and China-Central Asia freight trains [2] Group 2 - The guests at the summit experienced the cultural richness of Luoyang, including a reenactment of historical ceremonies at the Site Museum of Dingding Gate [3] - A Tang-style Cultural Restaurant provided a multisensory experience of the Tang Dynasty, showcasing the grandeur of that era through food, music, and dance [4] - The Dongfanghong Innovation Hub of YTO Group Corporation highlighted Luoyang's advancements in equipment manufacturing, particularly in modern farm machinery [5] Group 3 - Foreign guests expressed appreciation for China's support in professional technologies and equipment, which has enhanced agricultural development in their countries [7] - The Longmen Grottoes showcased China's stone carving art, with guests recognizing Luoyang's unique cultural heritage and expressing interest in tourism as a means to foster deeper exchanges [8] - The visit left a lasting impression on the guests, who described Luoyang as "stunning, magnificent, and breathtaking," emphasizing the city's historical significance and modern vibrancy [9]
DE Taps Brazil's Agricultural Boom to Power Future Growth Trajectory
ZACKS· 2025-06-11 14:25
Core Insights - Deere & Company is committed to supporting Brazil's agricultural transformation, positioning itself as a key player in the country's rise as a global agricultural superpower [1] - Brazil's agricultural production is expected to increase significantly over the next decade, with soybeans projected to rise by 46%, corn by 50%, sugarcane by 20%, and cotton by 38% [1] Group 1: Market Position and Growth - Corn and soy account for 90% of Brazil's total grain production, highlighting the strategic importance of these crops for Deere [1] - Deere's tractor market share in Brazil has nearly doubled from 2009 to 2024, with significant growth in the combine (1.5 times), planter (2.5 times), and sprayer (2 times) markets [4] - The company has made substantial investments in Brazil, including eight factories, four facilities, and one R&D center, diversifying its product portfolio beyond just soybeans [3] Group 2: Technological Innovations - Expanding farming areas by utilizing degraded land and implementing double cropping practices will support agricultural growth, with Deere's precision solutions playing a crucial role [2] - Deere is addressing poor cell coverage in Brazil by developing satellite-based solutions for real-time data management, expecting its connected machines to grow from 17 in 2020 to 200 by 2030 [3] Group 3: Competitive Landscape - Other players like AGCO Corporation and CNH Industrial are also focusing on the Brazilian market, with AGCO announcing new facilities and investments to enhance its manufacturing presence [5][7] - CNH Industrial showcased innovative products at Agrishow 2025, indicating a competitive environment in agricultural machinery [6] Group 4: Financial Performance - Deere's shares have increased by 21.9% this year, outperforming the industry growth of 21% and the S&P 500's gain of 1.7% [8] - The forward 12-month price/earnings (P/E) ratio for Deere is 25.11X, compared to the industry average of 23.46X, suggesting it may not be a compelling value proposition at current levels [10] Group 5: Earnings Estimates - The Zacks Consensus Estimate for Deere's fiscal 2025 earnings indicates a year-over-year decline of 26.5%, with revenues expected to drop by 15% [11] - However, fiscal 2026 estimates show a potential recovery with earnings growth of 17% and a revenue increase of 7.3% [11]
CNH Industrial (CNH) 2025 Capital Markets Day Transcript
2025-05-08 14:00
Summary of CNH Industrial 2025 Capital Markets Day Company Overview - **Company**: CNH Industrial (CNH) - **Industry**: Agricultural and Construction Equipment - **History**: Over 180 years of innovation and engineering excellence, with a significant presence in North America, generating 40% of agricultural net sales [1][2][8] Key Financials - **Annual Revenues**: Ranged between $15 billion and $25 billion over the past five years [2] - **Employee Count**: Over 36,000 employees globally [2] - **Cost Savings**: Achieved run rate savings of more than $550 million from cost of goods sold by the end of 2024 [12] Strategic Focus and Innovations - **Technological Enhancements**: Acquisition of Raven in 2021 enhanced technological capabilities and innovation efforts [6] - **Product Portfolio**: Comprehensive agricultural machinery distribution network, offering a full line of products from tractors to crop protection equipment [21][25] - **Precision Technology**: Doubling precision tech contribution to agricultural net sales to 10% by 2030, with significant advancements in AI and automation [27][90] Strategic Pillars 1. **Product Leadership**: Commitment to expanding product offerings and integrating precision technology [23] 2. **Margin Improvement**: Targeting a mid-cycle adjusted EBIT margin of 16% to 17% in agriculture by 2030 [39][43] 3. **Shareholder Value**: Focused on returning substantial industrial free cash flow to shareholders while exploring M&A opportunities [24] Market Dynamics - **Cyclical Nature**: The agriculture market is influenced by commodity prices, weather patterns, and government policies, with expectations of a market bottoming at 85% to 90% of the ten-year average [34][36] - **Historical Margin Performance**: Improved mid-cycle margins from 10% in 2021 to a target of 16% to 17% by 2030 [41] Operational Changes - **Organizational Restructuring**: Delayered organization to enhance responsiveness to market conditions and improve P&L ownership at the regional level [18] - **Quality Commitment**: A holistic approach to quality across product development, manufacturing, and supply chain, aiming to reduce costs of non-quality by 200 to 250 basis points by 2030 [32] Product Innovations - **New Product Launches**: Plans for over 15 new tractor launches, 10 combine launches, and 19 crop production launches by 2027 [63] - **Smart Technology**: Introduction of smart spraying solutions that can reduce herbicide use by up to 80% [90] Dealer Network Strategy - **Strengthening Partnerships**: Investing in dealer capabilities and enhancing service offerings to ensure customer satisfaction and loyalty [98][100] - **Regional Tailoring**: Adapting the dealer network strategy to meet unique market demands, balancing single and multi-brand models [104] Conclusion - **Future Outlook**: CNH Industrial is committed to innovation, operational excellence, and strategic growth, positioning itself as a leader in the agricultural and construction equipment industry [44][45]
AGCO REPORTS FIRST-QUARTER RESULTS
Prnewswire· 2025-05-01 11:30
Core Insights - AGCO reported net sales of $2.1 billion for Q1 2025, a decrease of 30.0% compared to Q1 2024, with reported net income of $0.14 per share and adjusted net income of $0.41 per share [1][9][25] - The company is focusing on cost reduction and inventory management, having cut production hours by approximately 33% year-over-year [2][5] - Global agricultural equipment market remains volatile due to tariffs and shifting export demand for grain, despite some positive signs in farmer sentiment and commodity prices [2][5] Financial Performance - Net sales decreased by 30.0% year-over-year, with adjusted net income per share dropping from $2.32 in Q1 2024 to $0.41 in Q1 2025 [1][9][25] - Income from operations fell significantly, with a reported income of $49.4 million in Q1 2025 compared to $273.6 million in Q1 2024 [25][43] - The company affirmed its full-year guidance, projecting net sales of approximately $9.6 billion for 2025 [17] Regional Sales Performance - North America: Net sales decreased by 34.2%, with tractor sales down 14% and combine sales down 46% [10][13][5] - South America: Net sales decreased by 15.8%, but tractor sales increased by 11% [10][6] - Europe/Middle East: Net sales decreased by 22.1%, with significant declines in major markets [10][15] - Asia/Pacific/Africa: Net sales decreased by 36.0%, primarily due to weaker demand in Australia, Japan, and China [10][16] Market Trends - The agricultural equipment market is experiencing reduced demand due to high input costs and uncertain grain export demand [5][10] - Positive trends include improved farmer sentiment in Europe and rising U.S. corn prices, although these are tempered by ongoing global trade uncertainties [2][5] - Brazil's agricultural sector shows potential for growth, particularly in smaller tractor categories, despite challenges in larger equipment demand [6][5] Operational Adjustments - The company has implemented significant cost reduction measures, including a restructuring program aimed at enhancing operational efficiencies [37][40] - Inventory levels have been managed down, with a focus on improving dealer inventory in North and South America [2][5] - AGCO's operating margins are under pressure, with adjusted operating margins projected to be between 7% and 7.5% for 2025 [17]