Boom Time For Farmers Means Rising Stock For Combines 24/01/2008
With grain prices rising and farming production growing stronger on the global market, farming equipment like combine harvesters have already seen a large spike this year. The US farm income hit an all time high of $87.5 billion in 2007. A stunning 26 percent increase from 2006 and an even more impressive 52 percent increase from the 10-year average.
According to David Fondrie, chief investment officer of Heartland Advisors this means increasing stock prices for farming equipment will only rise with the health of the farming industry. Fondrie said, “The farmer is now in a great position to spend, farmers can now go out and buy more machinery.” For manufactures such as Deere, who sell roughly half of their farming equipment to the US, this is especially good news since announcing a global expansion of operations to Brazil, Russia, India and China. Deere expects their combine harvester revenues to grow at least 17 percent in 2008, going on the large sale in tractors.