U.S. Farmers Turn to Equipment Leases Following Profit Slump



According to a Reuters report, U.S. farmers nervous that slumping grain prices will crimp profits are increasingly leasing equipment instead of buying it, creating new risks for manufacturers like Deere & Co that could suffer from declining values for leased machinery.

Reuters reported that farmers, facing weak markets after years of cashing in on soaring crop prices, are readjusting to a new normal in which they scrutinize every expense, particularly high-ticket items like massive shiny tractors and planters.

According to Reuters, the shift toward leases is the latest ripple effect from the downturn in the farming economy, which the Agriculture Department predicts will cut net farm income by more than 30% this year to $73.6 billion, the lowest since 2007.

Reuters reported switching to equipment leases allows farmers to take advantage of historically low interest rates and frees up capital for other financial needs, such as buying seed and fertilizer and paying farmland rents.

To view the full Reutersreport, click here.


Like this story? Begin each business day with news you need to know! Click here to register now for our FREE Daily E-News Broadcast and start YOUR day informed!

Leave a comment

View Latest Digital Edition

Terry Mulreany
Subscriptions: 800 708 9373 x130
[email protected]
Susie Angelucci
Advertising: 484.459.3016
[email protected]

View Latest Digital Edition

Visit our sister website for news, information, exclusive articles,
deal tables and more on the asset-based lending, factoring,
and restructuring industries.
www.abfjournal.com