Deere & Company expects farm equipment sales to rise in 2021

New Delhi — The world's biggest farm equipment manufacturer Deere & Company expects worldwide sales of its agriculture and turf equipment to rise in the fiscal year 2021 on the back of improved conditions in agricultural and construction sectors, the company said Feb. 19.

The US-based company raised its annual net income forecast for fiscal year 2021, which started in November 2020, to $4.6-$5 billion, higher than the $3.6-$4.0 billion forecast earlier, it said in its first quarter earnings call.

"Improved conditions in agricultural and construction sectors are setting stage for the year of strong performance," it said.

The company's sales of large agricultural equipment in the US and Canada are forecast to rise 15%-20% in 2021, while sale of small agricultural equipment is seen rising 5%.

Prices of agricultural commodities in the US -– particularly soybean, wheat, and corn -– have seen a substantial rise in the past year due to unprecedented demand from China, shrinking production and ending stocks estimates.

The US Department of agriculture has expected record acreage to be planted under US corn and soybean in the 2021-22 season, supported by higher prices.

Full-year industry sales in the EU nations are also forecast to be up 5%, while sales in South America are likely to see a 10% jump, the company said, adding Asian sales are expected to be slightly lower.

For the first quarter ended Jan. 31, 2021, Deere & Company reported a net income of $1.224 billion, compared with a net income of $517 million for the quarter ended Feb. 2, 2020. The company has smashed the earning expectations, according to news reports, with the first-quarter net income more than doubling on 23% gain in net sales.

For fiscal 2020, net income attributable to the company was $2.751 billion, compared with $3.253 billion in 2019.