Deere to accelerate capital spending John Deere, the world's biggest tractor maker by revenues, said it was accelerating capital spending this year after it underlined the strength of the global agricultural economy by raising its full-year outlook. Reporting better than expected earnings for the three months ended April, Sam Allen, chief executive, said the company was "in a sound position to respond to a rising global need for food, shelter and infrastructure in the years ahead." "In our view, these powerful trends have considerable staying power," he said. Deere revised its forecast for full-year net income to $3.35bn, up from its prior estimate of $3.28bn. In the company's fiscal second quarter it earned net income of $1.06bn, or $2.61 per share, up from $904m, or $2.12 per share, for the same period last year. Analysts had on average been expecting net profits of about $2.54 per share. Revenues were $10bn, up from $8.9bn a year earlier and ahead of forecasts of about $9.7bn. Mr Allen said the results had prompted the company to speed up its capital spending plans. "Our extensive investments in new products and additional global capacity are moving ahead at an accelerated rate," he said. Deere has 12 big projects under way throughout the world, including seven new factories. The company said it expected North America to provide the strongest demand growth this year, forecasting that farm machinery sales in the US and Canada would rise by more than 10 per cent, with particular demand for expensive high horsepower equipment. The US Department of Agriculture forecast last week that in the 2012-13 crop season, which starts in September, US corn production will rise by almost one-fifth to 14.8bn bushels, with farmers sowing the most corn in 75 years. In western Europe, Deere said "favourable conditions in the grain, livestock and dairy sectors outweigh general economic concerns" and forecast that sales would be in a range between flat and 5 per cent higher. Sales in eastern Europe were expected to be "considerably higher." Deere said it expected sales to slow down in Asia but still be moderately improved from last year, while in South America it forecast sales would fall by 5-10 per cent because of uncertainty in Argentina and drought conditions in parts of the region. The only negative part of the results was at John Deere Capital Corporation, the company's financing arm, where profits fell because of lower interest rates on loans to customers and higher administrative costs. The unit earned $78m in the quarter, down from $86m last year. Deere shares were up 1.2 per cent in pre-market trading at $77.50.