This week’s speaker was Luke Chandler, chief economist at Deere & Company. Luke relocated 2 ½ years ago from Sydney Australia with his wife and two young sons to join Deere. Since arriving, he and his wife have added a daughter to the family. All three of his children were born on different continents (Australia, Europe and North America.)  

 

Luke has held his current position of chief economist since May 2017. In this position, he provides guidance, counsel and insight on global macro-economic policy and trade developments to the company’s senior management team for use in determining strategy and business direction. He is also responsible for economic, agricultural, construction and forestry forecasts and outlooks critical to regional and enterprise initiatives over both the short and long term. There is a strong outlook for the economy overall.

 

Regarding the short-term (2018) business conditions, there is stronger global economic growth; increased business confidence in the U.S.; trade uncertainty to due geopolitical tensions; and grain prices are remaining range bound.

 

The low unemployment rate is having a negative impact on growth. There is high demand for housing but a shortage of laborers. The same is true for the freight industry. Freight demand has increased by 50% but there is a lack of drivers to meet the need.

 

The medium term (1 – 5 year) outlook is positive. Farm income is stabilizing and global grains are re-balancing.

 

The #1 risk is trade and the impact that withdrawal from NAFTA will have on farming. There is increasingly more concern about having a trade war with China. The U.S. has the most to lose in a trade war and it would be a detriment for U.S. farmers.

 

From a world perspective, China’s growth has stabilized at around 6% - 8%. They have maintained this growth by borrowing, and their debt has increased by 330% in 10 years. India is overtaking China as the most populous country. China is an aging country and India has a lot of investment taking place. India is currently the largest tractor market in the world but it’s a very competitive market. 

 

 

 

Halenka gave an update on her last few weeks. She went to Southern Illinois University in Carbondale on a college visit with her host family. She was surprised that they drove six hours to get there and they were still in Illinois. She can drive three hours from her home and be in Amsterdam, and a four hour drive gets her to Paris. She also attended the Sadie Hawkins dance. She said it was fun but not as fun as Homecoming. She had her first track meet this past weekend. She said it’s way better than cross country. She ran in both the 200 and 400 meter dash.