Farmers in the U.S. have had good news to rally around lately: U.S. farm income is up and global demand for their supplies is steadily increasing. This agricultural boom gives farmers an opportunity to invest in new farming supplies. On the news, farm equipment maker John Deere recently posted sales increases.
This past week, John Deere reported sales gains of 33 percent compared to the fourth quarter a year ago. John Deere attributed the climb in sales to a cash influx farmers have lodged since grain prices have climbed this year amid rising rising demand for their goods from developing nations like China and India. For the fiscal year, John Deere earned $1.86 billion in 2010, compared to $874 million in 2009.
Samuel Allen, John Deere's chief executive, noted that conditions "continued to be positive in the U.S. farm sector," emphasizing that earnings "included a highly favorable sales mix of larger equipment." During this agricultural boom, farmers have more disposable income to spend on investing in new equipment and the company is seeing an uptick in business because of this.
John Deere hopes the positive sales gains continue into 2011. According to its analysts, global agricultural sales are forecast to be up by 7 to 9 percent next year, based on dwindling food supplies and an increasingly competitive global landscape for farm goods from the U.S.