CHICAGO (Reuters) - Deere & Co. DE.N on Wednesday warned of lower earnings next year after reporting a fall in quarterly profits, hurt by trade tensions as well as poor weather in the U.S. farm belt that has slowed equipment purchases by farmers.

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In response to an “uncertain” business environment, the company announced a voluntary separation program for its salary employees, which is estimated to cost it about $140 million next year, but is projected to contribute to annual savings of $150 million.

The world’s largest farm equipment maker said it was also reviewing its overseas footprint and would focus on growing its more profitable parts and services business.

“2019 was a challenging year,” Chief Financial Officer Ryan Campbell told analysts on an earnings call.

The world’s largest farm equipment maker expects net income of $2.7 billion to $3.1 billion next year, lower than $3.25 billion in 2019 and compared with Refinitiv’s average analyst estimate of $3.5 billion for 2020.

The profit warning sent the company’s shares sinking 5% to $167.64 in morning trade.

Deere gets a little over half of its revenue from the United States. Sales have taken a hit in the wake of the U.S.-China trade war that has dented U.S. agricultural exports, leaving farmers struggling to turn a profit. A sharp decline in U.S. corn exports and President Donald Trump’s ethanol policy have further pressured farm incomes.

Poor weather, meanwhile, has delayed the harvest in the U.S. grain belt.

Deere has cut production and laid off workers to keep a lid on costs in the face of weak demand. Those cuts helped it reduce the inventory of large tractors and combines in the United States to the lowest level since 2014.

It expects global agriculture and turf equipment sales to decline 5% to 10% next year. Industry sales of farm equipment in the U.S. and Canada are forecast to decline about 5% on lower demand for large equipment.

Sales of construction and forestry machines are projected to be down 10% to 15% worldwide in 2020.

Adjusted profit in the latest quarter came in at $2.14 per share, down from $2.30 per share last year.

Equipment sales were up in the quarter from a year ago. But profit from those sales declined due to higher operating expenses.

Operating-lease losses resulted in lower quarterly profits at the financial services division, prompting a revamp of the leasing program.