Deere’s construction gains face a farm downturn forecast, even as AI buildout lifts equipment demand

Deere is indicating a two-speed equipment market, with construction machinery benefiting from a wave of new projects while agriculture equipment faces headwinds, according to a market report published by Yahoo Finance on Aug. 21, 2026.

The report characterizes Deere as “getting rolling” as demand trends in construction equipment remain firmer than in farm equipment. It also ties the construction strength to a broader buildout tied to artificial intelligence, which is pushing activity in areas like data centers and supporting infrastructure where heavy equipment is used.

On the farm side, Deere’s outlook described in the report points to a meaningful decline in large agriculture equipment volumes during the year. The article says volumes could fall by as much as 20% in 2026, framing it as a weathered demand environment for some farm categories rather than a total collapse across Deere’s business.

In contrast, the report describes construction equipment demand as growing, suggesting that Deere’s results and order flow could increasingly reflect conditions outside traditional farm cycles. The market narrative is that projects requiring earthmoving, grading, and material handling continue even as agriculture equipment demand softens.

Deere’s position in both sectors, and its ability to re-balance production and selling efforts across them, is central to the company’s near-term story. When farm demand weakens, construction activity can help offset declines, but it depends on how long project spending remains resilient.

Even with the construction tailwind, the report does not provide a detailed breakdown of which specific construction product lines are gaining the most, or whether Deere is seeing the improvement in incoming orders, deliveries, or both. It also does not clarify how much of the construction demand growth is directly attributable to AI-related projects versus general infrastructure spending.

For investors and dealers, the key uncertainty is timing. Deere’s market commentary suggests a shift in mix rather than a single-category surge, but the report does not say whether agriculture equipment volume declines are expected to bottom later this year or roll into 2027.

What to watch next is whether Deere can sustain construction momentum through the next dealer selling season, while controlling costs and inventory in its agriculture business. The durability of the construction demand driver tied to AI buildout, and how quickly farm volumes stabilize, will likely determine how the market reads Deere’s earnings trajectory over the coming quarters.