The nature of dairy farming in the U.S. is undergoing a radical transformation and nowhere close to being over. It’s part of a pattern being seen in other parts of the agriculture, including grain farming and ag equipment dealerships where today’s economics dictate that bigger means better net returns.
A continued lower price environment, uncooperative weather events over the past year, trade uncertainty and COVID-19 have all contributed to depressed net cash farm income levels and placed upward pressure on farm bankruptcies.
Continued adoption and integration of new technologies to improve crop yields and meet the soaring demand for food are expected to be key influencers for growth in the agriculture market, according to a new study, Vertical Market Outlook Series: Agriculture Equipment released by the Equipment Leasing & Finance Foundation.
“Continued low prices, high production expenses and extreme weather is leading to more farm stress, including higher chapter 12 bankruptcies," says a March 22, 2019, report in the Minneapolis Federal Reserve Banks’s recent issue of Fedgazette.
Feedback from farmers, agricultural lenders, suppliers, and other interests in the ag sector, gathered informally by the Minneapolis Fed over the past year or so in meetings and other venues, has suggested that farm balance sheets are increasingly stressed.
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In this episode of On the Record, brought to you by Associated Equipment Distributors, Deere Director of Investor Relations Josh Beal told JP Morgan analysts that the OEM is confident it will be “producing to demand” in fiscal year 2025.