John Deere CEO: Farming's Future, Autonomous Tractors and AI in the Field

Well, you know, we've had obviously a lot of disruption on the trade side of grains.

So when certain markets are no longer actually purchasing grains from a country, then the overall trade flows get disrupted again.

and it causes just anxiety.

Now, the great thing is supply and demand are pretty well matched.

The supply for crop, what farmers produce, and the demand from consumers, people that are eating, feeding families around the world are well matched.

But when we get disruption in trade flows, it really causes a bit of anxiety and pause on where is my crop going to go? So this is a, you know, if you look at other times when farm income is down, typically it's one specific country and it's related normally to a big weather event, like you have a drought in Australia.

And all of a sudden now, we're short of crop and markets have to adjust to serve Australia.

This is a global issue.

We're seeing all markets right now disrupted, whether you're talking about Australia, Argentina, Europe.

We're seeing disruption around the world.

I mean, we have markets that have come completely out of growing crops, like Russia, as an example.

We had operations there.

We were focused on growing small grains.

with producers, we're no longer in that market.

You have markets like the Ukraine that are disrupted right now, as well as the war that we're seeing in Iran and the effect that that's having on fertilizer, the flow of fertilizer, as well as fuel.

So lots of uncertainty right now that's

causing that.

You called 2026 the bottom of this cycle.

How can you be so sure about that? Well, the reason

we believe it's the bottom is all of the stuff that we can control, we've controlled.

So, for example, what causes a slowdown in the purchase of new equipment is when you start to see overall used volumes go up or you just came off a period where there was lots of sales increasing.

And that inventory is now trading and you need to find a second home for it.

So we've worked really hard to get our used inventories in the appropriate level that the markets need around the world.

And how we do that is we intentionally underproduce retail demand.

By underproducing retail demand, you allow customers to purchase used equipment and then you get stability back in the market.

Well, you know, we've had obviously a lot of disruption on the trade side of grains.

So when certain markets are no longer actually purchasing grains from a country, then the overall trade flows get disrupted again.

and it causes just anxiety.

Now, the great thing is supply and demand are pretty well matched.

The supply for crop, what farmers produce, and the demand from consumers, people that are eating, feeding families around the world are well matched.

But when we get disruption in trade flows, it really causes a bit of anxiety and pause on where is my crop going to go? So this is a, you know, if you look at other times when farm income is down, typically it's one specific country and it's related normally to a big weather event, like you have a drought in Australia.

And all of a sudden now, we're short of crop and markets have to adjust to serve Australia.

This is a global issue.

We're seeing all markets right now disrupted, whether you're talking about Australia, Argentina, Europe.

We're seeing disruption around the world.

I mean, we have markets that have come completely out of growing crops, like Russia, as an example.

We had operations there.

We were focused on growing small grains.

with producers, we're no longer in that market.

You have markets like the Ukraine that are disrupted right now, as well as the war that we're seeing in Iran and the effect that that's having on fertilizer, the flow of fertilizer, as well as fuel.

So lots of uncertainty right now that's

causing that.

You called 2026 the bottom of this cycle.

How can you be so sure about that? Well, the reason

we believe it's the bottom is all of the stuff that we can control, we've controlled.

So, for example, what causes a slowdown in the purchase of new equipment is when you start to see overall used volumes go up or you just came off a period where there was lots of sales increasing.

And that inventory is now trading and you need to find a second home for it.

So we've worked really hard to get our used inventories in the appropriate level that the markets need around the world.

And how we do that is we intentionally underproduce retail demand.

By underproducing retail demand, you allow customers to purchase used equipment and then you get stability back in the market.