Shares of agricultural machinery manufacturer AGCO Corp. saw their steepest decline in over a month, as the company warned of financial struggles in 2025 amid continued challenges in the agricultural sector.
At its annual investor meeting on Thursday, the Georgia-based company forecasted net sales for 2025 to reach approximately $9.6 billion, a significant drop from the estimated $12 billion for 2024. The decline is partly attributed to AGCO’s decision to divest its grain-storage and livestock businesses.
The company also expects retail sales in North America, its largest market, to fall by 25% next year.
“There’s no surprise here: the agricultural industry is continuing to weaken,” said Damon Audia, AGCO’s Chief Financial Officer, during the New York meeting.
As a result of the grim outlook, AGCO’s stock plunged by as much as 6.1%, marking its biggest drop since November 5.
The agricultural sector has been under pressure since the onset of the Russia-Ukraine conflict in 2022, which initially drove up grain and oilseed prices. However, prices for crops like soybeans are now near four-year lows, reducing farmers’ purchasing power for new machinery. Furthermore, the looming threat of new tariffs on goods from China, Mexico, and Canada under President-elect Donald Trump could further disrupt markets for crops and machine parts.
Despite the challenging environment, AGCO has seen growth in market share, particularly with the increasing adoption of its high-end Fendt tractors and PTx technology, which assists farmers in precision agriculture.
“We’re experiencing a much softer market,” said AGCO CEO Eric Hansotia. “Every business cycle has a period where things shift from very good to not so good, and we’re currently in that transition.”
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