Deere is raking it in from the global economic recovery. The world’s largest farm equipment maker reported Friday that its quarterly profit more than doubled. Farm machinery manufacturers are benefiting from a turnaround in the U.S. agricultural economy.
A jump in domestic grain prices has enriched farmers, who are using that cash to invest in new tractors and combines to replace their aging fleets. Manufacturers are also able to charge higher prices for their equipment.
It’s a far cry from previous years when the sector was slammed by the trade war with China, an oversupply of grain and the health crisis. Deere expressed optimism about the road ahead, hiking its full year earnings forecast.
But it said it expects supply-chain pressures to intensify. Its CEO said the company is working closely with key suppliers to secure parts and components.
Deere shares, which have vastly outperformed the S&P 500 this year, rose in early trading Friday.