In an attempt to meet growing customer demand for high horse
power tractors in Brazil,
Deere & Company
) will spend around $40 million to manufacture its 8R tractors at
its plant in the city of Montengro.
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The 5R, 6R and 7R Series of tractors are currently being
manufactured in Deere's Montenegro facility. The production of
the 8R model designed with significant technology will increase
customers' productivity with more power and less fuel
The New 8R series tractor will open up a new financing option,
FINAME. The program is aiming to finance the acquisition of new
machinery and equipment made in Brazil, accredited by BNDES (The
Brazilian Development Bank).
Deere currently manufactures 8R tractors in the Waterloo, Iowa,
plant and expects to produce it in Brazil by late 2015. Deere
also expects that the investment will increase its use of
suppliers in the region alongwith the growth in the Agriculture
& Turf Division.
The agriculture sector is in for a boom time with the U.S.
Department of Agriculture (USDA) forecasting a record net farm
income of $120.6 billion in 2013, a 6% year-over-year rise
triggered by record crop production.
Deere reiterated worldwide sales growth guidance of Agriculture
and Turf equipment at 7% for fiscal 2013. Higher commodity prices
and strong farm incomes are expected to boost demand for farm
machinery during the year. Furthermore, increase in global demand
for food, shelter and infrastructure confirms that the long-term
outlook for Deere remains compelling.
Moline, IL-based Deere is engaged in the production and
distribution of agricultural and forestry equipment, construction
equipment and engines worldwide. The company sells products in
the U.S. and Canada through branch offices as well as through
distributors and dealers for the resale of products
Deere currently holds a Zacks Rank #3 (Hold).
Other stocks in the industrial products sector with a favorable
Zacks rank are
Alamo Group, Inc.
) with a Zacks Rank #1 (Strong Buy), and
) with a Zacks Rank #2 (Buy).