Deere's Long-Term Stock Potential: A Structural Tailwind from U.S. Dietary Policy Shifts

The release of the 2025–2030 Dietary Guidelines for Americans under Health and Human Services Secretary Robert F. Kennedy Jr. marks a seismic shift in U.S. nutrition policy, prioritizing whole foods like protein, full-fat dairy, and healthy fats while curtailing processed foods and added sugars. This policy reset, dubbed the "Make America Healthy Again" agenda, is poised to reshape agricultural demand and create a structural tailwind for equipment manufacturers like John Deere. By aligning with the growing emphasis on protein and dairy production, Deere's innovations in precision agriculture and automation position it as a critical enabler of this transition, warranting a strategic buy recommendation.

Dietary Guidelines as a Catalyst for Agricultural Demand

The new guidelines explicitly call for doubling protein consumption, increasing daily intake from 0.8 to 1.2–1.6 grams per kilogram of body weight. This shift is expected to drive demand for livestock products such as beef, pork, poultry, and eggs, as well as full-fat dairy, which the guidelines now endorse without restrictions on saturated fats. For context, the National Milk Producers Federation has already expressed support for the guidelines' recognition of dairy's role in a healthy diet.

The agricultural sector is responding accordingly. The USDA projects that beef production will remain constrained by drought-driven herd reductions in 2025, but pork production is expected to rise to 28.5 billion pounds as hog numbers increase. Meanwhile, dairy groups highlight the guidelines' emphasis on full-fat dairy as a boon for fluid milk and cheese consumption, which saw a 0.6% and 60-year high, respectively in recent years. These trends suggest a long-term structural increase in demand for protein and dairy, which will require expanded production capacity.

Deere's Innovations Align with Protein/Dairy Sector Needs

John Deere's recent product innovations are uniquely positioned to support this agricultural transformation. At Agritechnica 2025, the company unveiled its second-generation autonomous 9RX tractor, battery-electric E-Power prototypes, and regenerative tillage equipment designed to improve soil health. These tools address key challenges in protein and dairy production, including labor shortages and the need for sustainable practices. For example, Deere's See & Spray technology, which uses AI to target herbicide application, has seen over 1,000 new orders in 2025, reflecting growing adoption of precision agriculture in livestock feed crop production.

The company's focus on automation and electrification also aligns with the dietary guidelines' emphasis on efficiency and sustainability. Deere's autonomous electric tractors, equipped with IoT integration, are projected to boost yields by up to 15% while reducing resource consumption. This is critical for dairy and meat producers, who face pressure to meet rising demand without expanding environmental footprints. Additionally, Deere's Smart Industrial strategy-targeting 10% annual sales growth through automation-positions it to capitalize on the long-term tailwinds of the dietary policy shift.

Financial Resilience Amid Short-Term Headwinds

While Deere's Q4 2025 net income fell 14% year-over-year to $1.065 billion, driven by tariffs and weak crop prices, the company's long-term fundamentals remain robust. Its production and precision agriculture segment, though expected to decline by 15% in 2025, reported a 10% revenue increase in Q4, driven by higher shipment volumes. Meanwhile, the construction and forestry segment saw a 27% sales surge, offsetting some agricultural sector pressures.

Crucially, Deere's leadership anticipates 2026 as the bottom of the large ag equipment cycle, with stabilization expected as dietary-driven demand for protein and dairy gains momentum. The company's $389 million investment in sustainability-focused construction machinery and its 15.3% global farm equipment market share further underscore its capacity to adapt to evolving agricultural needs. Analysts project Deere's net income for 2026 to range between $4 billion and $4.75 billion, with growth in small agriculture and turf segments offering additional upside.

Strategic Buy Recommendation

The interplay between the 2025 dietary guidelines and Deere's technological leadership creates a compelling case for a long-term buy recommendation. As federal nutrition programs like the National School Lunch Program and WIC align with the new guidelines, demand for protein and dairy will necessitate increased adoption of Deere's high-efficiency equipment. This structural tailwind is further reinforced by the agricultural sector's shift toward automation and sustainability, areas where Deere holds a dominant position.

While near-term challenges such as tariffs and soft crop prices persist, these are cyclical headwinds rather than existential threats. The long-term trajectory-driven by dietary policy, population growth, and technological adoption-favors Deere's stock as a strategic play on the future of American agriculture. Investors who position now stand to benefit from both the company's innovation-driven growth and the broader structural shift toward nutrient-dense food production.