By Michael Hirtzer
Farmers will soon start feeling the impact from President Donald Trump’s tariffs in the form of higher prices for the machines used to plant, treat and harvest fields.
That’s the warning from AGCO Corp. and CNH Industrial NV. With duties on the rise, the equipment makers will increasingly be forced to pass along the extra costs — both to farmers in the U.S. and to those elsewhere in the world.
For instance, some of AGCO’s high-end Fendt tractors and combines are built in Europe, where the E.U. bloc accepted a 15% tariff on most of its exports to the U.S. Rather than letting the price of one model spike, AGCO is instead moving to smooth it out across its offerings.
“We have a pile of costs that we’ve got to absorb somehow, and we look to sprinkle it wherever we can, all around the world on all products,” AGCO Chief Executive Officer Eric Hansotia said in an interview.
Tariff exposure is still a moving target, with Trump’s latest volley outlining minimum baseline levies of 10%. That’s forcing companies to put together increasingly complex scenarios on how to minimize costs and still turn a profit. AGCO’s current outlook for a 1% price rise in 2025 is subject to change.
CNH, with brands including Case IH and New Holland, said Friday it has increased prices for its model-year 2026 machines, without specifying by how much. That’s after steel and aluminum tariffs increased from earlier this year, which also boosted domestic U.S. material costs.
“It’s also important to note that most of the units sold in the quarter were not yet heavily impacted by additional tariff costs,” CNH Chief Financial Officer James Nickolas told investors on a call. “Those impacts will come more in the second half as that tariff-impacted inventory flows through our production system.”
The potential for higher machinery prices for farmers comes as they also struggle with sliding crop values that have crimped spending. CNH also pointed to elevated delinquencies on loans for Brazilian farmers, although that pressure has likely peaked.
“It’s cyclically a tough time for farmers in Brazil,” Nickolas said.
© 2025 Bloomberg L.P.