U.S. farmers are expected to plant corn fence row to fence row this spring to capitalize on the impressive rally in commodity prices.
Tight supplies and strong demand pushed corn prices to a 31-month-high above $7 per bushel this week.
Though corn is, by far, the world's dominant agricultural commodity, it isn't alone. Other grains and oilseeds like wheat, soybeans and cotton ALL are flirting with contract -- if not all-time -- highs.
And since commodity prices in much of rural America are the lifeblood of the local economy, higher prices are fueling increased investment in agriculture -- a fact evidenced this week by a key equipment manufacturer.
Deere & Co., the world's largest maker of agricultural equipment, reported this week its quarterly net income more than doubled. It credited the good news, in part, to rising crop prices which encourage farmers to buy new farm machinery and to plant more acres.
The company said worldwide net sales and revenues for the first quarter increased 27 percent, to $6.12 billion, from $4.83 billion last year. Net sales of the equipment operations were $5.51 billion for the quarter compared to $4.24 billion a year ago.
Deere is expanding overseas operations, but its sales are rooted in North America. Sales of large farm machinery in the U.S. and Canada grew 35 percent in the quarter.
Deere reported construction demand up as well, with construction and forestry sales climbing 81 percent. Last year, the division had an operating loss of $37 million for the quarter.
Stock in Deere, which is based in Moline, Illinois, rose $2.24 to $95.86 a share.
The company predicts net income this fiscal year of about $2.5 billion, up nearly 20 percent from estimates made in November.