Pioneer in agricultural equipment, John Deere, has reported their second quarter earnings and the future seams bleak for many farmers and agricultural workers out there. U.S. farm commodity prices have been consistently declining since 2013, with the current projection for soyabeans per bushel at $8.90 compared to $13.00 in 2013.
Deere also sells construction equipment and reported a rise in sales of construction equipment, which equalizes the losses occurred in sales of agricultural equipment. The reported loss in sales of agricultural equipment can be attributed to the decline of commodity prices in the U.S. and is evident in their report.
The report further states that U.S farm cash receipts has declined in total from $412.3 billion in 2013 to $394.2 billion in 2015, with crops declining from $218.5 billion to $182.8 billion. For Brazil, the crop value growth does not look promising either. Since 2003, the crop value produced by agriculture has shown consistent growth but is now expected to decrease with 11% in 2015, compared to the previous season.
On a positive note, U.S. farm income from livestock increased from $182.8 billion in 2013 to $199.0 billion in 2015 and it was reported that beef prices have stabilized. Find the full report and media release here.