Deere & Co, the world’s largest farm equipment manufacturer, reported record fourth quarter profits, with predictions for equally high 2012 profits. The equipment company, along with many other American businesses, has been profiting heavily from record farm prices.
Farm profits across the country have been steadily increasing for the past several years, primarily driven by high crop prices. Corn and feed crops, for example, have risen in value largely due to increased ethanol production and increased international demand for American agricultural products. Recent free trade agreements in Asia and Latin American are likely to increase American farm exports and increase American farmers’ bottom line.
Overall, American farm incomes are expected to increase to a record $103.6 billion, a 31 percent jump.
Deere & Co incomes have skyrocketed, and estimated 2012 profits are expected to hit $3.2 billion. These record profits are being driven by increased equipment sales, which themselves are driven by increased crop prices. Prediction for the 2012 fiscal year place equipment sales up by 15 percent.
Deere & Co is not the only American enterprise enjoying the high crop prices. Local businesses that cater to farmers are benefitting from the increased cash flow. In addition, increased agricultural activity often translates into job creation, a major boon to economically depressed regions across the country.
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Written by: Justin Ellison / Farm Plus Staff Writer