Veriton Investment

Deere Outlook Falls Short as Farm Rebound Remains Elusive

(Bloomberg) — Deere & Co.s (DE) first outlook for the year ahead fell short of expectations as uncertainly continues to surround the timing for a recovery in the US farm economy.

The world’s biggest farm machinery maker said net income in the fiscal year that started Nov. 1 will be between $4 billion and $4.75 billion, below the average Bloomberg estimate for $5.31 billion.

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Shares fell by as much as 4.6% before the start of regular trading in New York.

“Looking ahead, we believe 2026 will mark the bottom of the large ag cycle,” Chief Executive Officer John May said in a statement.

The weak outlook for the maker of iconic green and yellow tractors comes as farmers have been hit hard by low crop prices and President Donald Trump’s tariff policies. Despite a recent deal between the US and China to boost shipments of American crops to Asia, there’s still questions on whether the sales will be enough to shake the US farm economy out of a years-long slump.

Rival manufacturer CNH Industrial NV earlier this month pointed to “ambiguity” on the terms of the trade deal, which leaves the sector with a lack of certainty on how it may benefit farmers in a way that would get them to spend more.

Still, many in the industry believe China’s resumption of US crop imports as well as a forthcoming aid package for American farmers should be a help in 2026.