Unit sales of agricultural tractors and self-propelled combines in August 2020 were positive for the 5th month in a row in the U.S. and stayed above the previous year for the third consecutive month in Canada.
According to the most recent USDA crop progress report, one quarter of corn was reported mature in the week ended Sept. 6, 2020. This exceeds the 10% reported mature in the same week last year and the 5 year average of 19%.
Inflation-adjusted U.S. net cash farm income (NCFI), defined as gross cash income less cash expenses, is forecast to increase $4 billion (3.6%) to $115.2 billion in 2020.
Farmer sentiment improved markedly in August as the Purdue University-CME Group Ag Economy Barometer rose to a reading of 144, 26 points higher than a month earlier. The improvement in producer sentiment was the result of improved perceptions regarding current conditions and, especially, better expectations for the future. The Index of Current Conditions rose 13 points in August to a reading of 124 while the Index of Future Expectations rose 33 points to a reading of 154.
The condition of the U.S. corn and crops deteriorated in the past week, according to USDA’s August 30 Crop Progress report. And of the two largest corn and soybean producing states, Illinois is far ahead of neighboring Iowa in terms of the health of its crops.
Agriculture — and the ag equipment industry — is no stranger to change. For instance, 60-70 years ago the price of a new tractor cost $1,855-$4,850, according to the Assn. of Equipment Manufacturers. Today, a similar sized tractor could easily cost 10 times that range.
According to the latest USDA Crop Progress report, around 44% of corn was reported dented in the week ended August 23, surpassing the 24% reported dented this time last year.
Recent quarterly earnings reports for the major farm machinery manufacturers were described as either “better than expected” or “could have been worse,” according to several industry analysts. This is to say, at least, AGCO and Deere exceeded analysts’ expectations. (CNH Industrial didn’t.)
According to the latest USDA Crop Progress report, 23% of corn was reported denting in the week ended August 16. This exceeded the 13% reported denting this time last year but was just below the 5 year average of 24%.
In this episode of On the Record, brought to you by Associated Equipment Distributors, we look at President Trump's tariff reduction on ag equipment, the latest dealer sales forecasts, and how high input costs are keeping farmer sentiment down.
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