Deere & Co. plans to raise prices as the world’s biggest farm-machinery manufacturer is buffeted by rising costs for freight and raw materials, according to Bloomberg.
Trucking expenses have been climbing in recent months in the U.S. amid a shortage of big-rig drivers, and fuel is becoming more expensive. Also hitting Deere and other manufacturers is the recent increase in prices for steel and aluminum.
The issue is "being addressed through a continued focus on structural cost reduction and future pricing actions," Chief Executive Officer Sam Allen said Friday in the company’s second-quarter earnings statement.
The earnings report was mixed: Deere posted disappointing profit per share, but also raised its forecast for full-year income. Allen said demand for both Deere’s signature green-and-yellow tractors and its construction machinery is increasing globally.
The CEO also said supply-chain bottlenecks, a problem in the preceding quarter, are now easing as Deere works with suppliers to raise production levels.
Deere now sees an increase of 14% for fiscal 2018, down from 15% previously.