This week’s Department of Agriculture crop reports sent stocks of farm machinery companies lower. USDA on Thursday reported higher than expected crop yields in the August round of crop reports, which includes key yield speculations.
Following the report stocks of Agco and Deere dropped roughly 2.5 percent each. CNH Industrial, the manufacture of Case and New Holland, dropped 1.5 percent on the report day.
With elevated crop surpluses decreasing farmer purchasing power, machinery sales in North America have fallen in the past three years, according to the Wall Street Journal. All crop yields except corn have collectively increased since 2016, according to the USDA report Thursday.
While corn production dropped seven percent from 2016, soybean production rose two percent, cotton production 20 percent, and winter wheat production one percent higher than its July forecast.