A recent Wall Street Journal article offers insight from Deere’s CFO on ways the farm equipment manufacturer is working to offset the impact of Trump Administration tariffs.
In a recent Wall Street Journal article, “Deere’s Plans for Offsetting $500 Million in Tariff Costs,” published May 30, reporter Mark Maurer spoke to Deere & Co. CFO Josh Jepsen on the ag equipment leader’s evaluation and renegotiation of supply contracts and the possibility of adjusting both its supply chain and production plans to weather the incoming storm it predicts from President Trump’s tariffs and impacts on the global economy.
Maurer offered a snapshot of steps the Moline, Ill.-based manufacturer is considering, noting that the company is facing weak demand from the combination of lower crop prices along with higher farmer production costs, and the company’s anticipation of over $500 million in costs from tariffs. The company attributes 60% of its estimated $500 million tariff cost to levies on goods from the European Union, Mexico and China, writes Maurer.
The article also reported that in an effort to obtain preferential duty rates, the company is working to obtain certificates under United States-Mexico-Canada Agreement, or USMCA — the trade agreement between the U.S., Canada and Mexico that went into effect July 1, 2020 during Trump’s first administration. In so doing, the company would be allowed to claim preferential duty rates on certain products exported between the countries.