The agriculture equipment sector continues to suffer from eroding margins and profits. Recovery does not look promising in the short run. The financial crisis in Asia has had the biggest impact which triggered demand to fall 40 percent for all u.s. grain exports. There has also been a bumper crop harvests, excess crop planting, have contributed to the glut of farm commodities. These conditions have led to a collaspe og agriculture farm commodities.
Demand is stimulated to a large degree by U.S. agricultural policy.
The Federal Agricultural Improvement Act of 1996 allows farmers to expand output. This derived demand will increase the need for more equipment. In addition, the world's multiplying population will mean more agriculture output and more agricultural equipment to satisfy demand requirements. Demand for construction equipment is declining. Labor shortages and lower interest rates can have a huge impact on residential construction growth.