Continued weak global demand for farm and construction equipment could see John Deere’s worldwide sales decline by around 7% next year. The effects of lower commodity prices and stagnant farm incomes are being felt everywhere. In the US and Canada the company predicts a 15 to 20% fall in sales of agricultural equipment during 2016, with reduced demand for high-HP tractors. Continued pressure on the European dairy sector is likely to result a flat market, and in the worst case scenario could see sales of farm machinery fall by 5%. In South America, Deere predicts industry sales of tractors and combines could be down 10 to 15%. Asian sales are projected to be flat to down slightly, due in part to weakness in China.

Next year’s negative outlook follows a bleak 2015 where Deere saw its worldwide net sales fall by a fifth to US$28.863 billion for the full year ending October 31, and profit levels tumble by nearly a half to US$1.9 billion (US$3.2 in 2014). For 2016, the concern predicts earnings could fall again to around US$1.4 billion. “Although our forecast calls for lower results in the year ahead, the outlook represents a level of performance that is considerably better than we have experienced in previous downturns,” said chairman and CEO Samuel R. Allen. Longer term, he believes the future holds great promise for the company. “John Deere remains in a strong position to carry out its growth plans and attract new customers throughout the world.”