Deere and Co - the maker of John Deere tractors - released earnings on Wednesday in which the company forecast global sales would fall next year.
While Deere had a bumper 2023 as many farmers upgraded equipment on the back of strong earnings in the wake of the Russian invasion of Ukraine, the company says that sales will slow for 2024.
Deere sees tractor sales in Europe falling 10% next year, with large agricultural equipment sales in the US down as much as 15%. As well as lower farmer incomes, higher interest rates are also starting to have an effect on demand.
The company updated US dealer inventory data shows high levels of unsold stock.
In 2023, Deere’s net income was $10.166bn (€9.33bn), an increase of more than $3bn on 2022, while global sales this year hit $55.565bn.
The tractor maker was able to take advantage of high demand to pass on rising input costs to buyers of their machines.
The size of the forecast for falling sales next year came as a surprise to investors, with the company’s shares dropping more than 6% in early US trading.