Deere & Co has today raised its full-year earnings forecast after quarterly profit topped Wall Street estimates on the back of strong demand for farm and construction equipment.

The world's largest farm equipment manufacturer now expects net income in fiscal 2021 to be between $5.7 billion and $5.9 billion, up from a range of $5.3 billion and $5.7 billion forecast in May.

This is the third upgrade in the company's earnings estimate in seven months.

Higher farm incomes following a run-up in commodity prices and the need to replace aging fleets are driving up demand for new tractors and combines.

"Looking ahead, we expect demand for farm and construction equipment to continue benefiting from favorable fundamentals," Deere's chief executive John May said.

The demand is booming at a time when dealer inventories are at a record low and the pandemic has disrupted the supply chain, extending the time equipment makers need to produce new orders.

Big tractor makers including Deere are booking orders for delivery in 2022.

With supplies lagging demand, companies are able to charge higher prices for their products and offset their soaring product costs.

For example, Deere's revised earnings estimate assumes an 8% gain in prices for large farm machines.

Earnings for the third quarter came in at $5.32 per share, up from $2.57 per share ago. Analysts surveyed by Refinitiv, on average, expected the company to post a profit of $4.55 per share.

The company said that equipment sales rose 32% year-on-year to about $10.4 billion.