Deere planning more layoffs as sales slow

The nation's largest agricultural equipment manufacturer on Friday announced more layoffs, adding to the more than 2,000 workers idled as sales have declined on lower farm income.

Moline, Ill-based Deere said 140 production workers at its John Deere Harvester plant in East Moline, Ill., have been notified that they will be on indefinite layoff effective Sept. 6. The plant employs approximately 1,050 production employees.

Deere said it continues to adjust the size of its production workforce to market demand for products manufactured at each of its factories. The company, which also produces construction, forestry and landscaping equipment, has projected a 10 percent drop in worldwide sales for the 2016 fiscal year.

Prices for corn and soybeans grown in Iowa and surrounding states have declined sharply from record highs. That has squeezed farm income and dramatically reduced the sales of combines. planters, row crop tractors and other farm implements.

Net farm income, a key indicator of farm well-being, is forecast at $54.8 billion in 2016 by the U.S. Department of Agriculture's Economic Research Service, down 3 percent from last year. The 2016 forecast represents the third consecutive year of decline and would be the lowest since 2002.

Farm income in the United States experienced a golden period from 2011 to 2014, driven largely by strong commodity prices and agricultural exports. U.S. agricultural exports are projected to account for over 30 percent of earnings in 2016, but are forecast to be 6 percent lower than 2015's total and well below a record $152.5 billion in 2014.

The Economic Research Service is projecting lower exports due primarily to a stronger U.S. dollar, coupled with a weakening economic outlook in several major foreign importing countries.