One of the world’s largest tractor makers says it’s getting harder to pass on price increases to customers, in a sign of tightening conditions for farmers.

Many farmers have been upgrading machines in the wake of Russia’s invasion of Ukraine in 2022 that disrupted grain exports and sent wheat prices to a record. But with harvests and prices normalizing while interest rates rise, farm profits are easing.

“We’ve been clear we have no intentions of decreasing pricing, but we think limiting how much we increase it is probably the right thing to do at this point,” Scott Wine, the chief executive officer of farm and construction machinery manufacturer CNH Industrial NV, said in an interview Friday.

Already, used inventory of crop-cutting combines is increasing in markets like North America. In Ukraine, where CNH has a large market share, farm equipment sales have dropped by 50% this year, Wine said.

Shares of CNH fell by as much as 7.4% after it missed even the lowest analyst estimate for revenue in the second quarter. Sales from agricultural machinery, which account for most of the company’s business, trailed the mean analyst forecast by 6.3% while they’re still expected to hit a record of over $19.5 billion this year.

Crop prices are “down from a high, but I think we’re still at reasonable levels there,” Wine said. “Overall, the farmer income levels are still quite strong.”

--With assistance from Gerson Freitas Jr..