Deere & Co , the world's largest maker of tractors and harvesters, reported a quarterly net loss on Wednesday on weak equipment sales and a series of one-time charges.

The company also provided a disappointing first glimpse of 2010, saying it expected farmers in North America and Europe to remain cautious because of the unsettled economic situation.

The farm sector, which had been largely insulated from the economic downturn last year, suffered in 2009 as commodity prices retreated from historic highs.

Since sales of tractors, harvesters and other agricultural equipment rise and fall along with farm income, Deere and competitors CNH Global NV and Agco Corp have seen demand deteriorate and have been scaling back production and cutting workers.

Deere expects a huge jump in pension costs next year, which analysts believe could shave 60 cents off its earnings.

The Moline, Illinois-based company reported a net loss of $222.8 million, or 53 cents a share, for the fourth quarter that ended on October 31, compared with a year-earlier profit of $345 million, or 81 cents a share.

Stripping out one-time items, including a goodwill impairment charge related to its turf unit and employee severance costs, the company would have reported a profit of 23 cents a share.

Sales fell 28 percent to $5.33 billion.

Deere expects 2010 net income of about $900 million, up from $873.5 million, or $2.06 per share, this year, but well below analyst estimates of $1.1 billion.

But any sales gains will have to come later in the year because Deere warned first-quarter sales could be down 10 percent from 2009 levels.

It expects farmers in North America and Europe to be cautious in their purchasing decisions as a result of sluggish overall economic conditions and near-term profitability issues in the livestock and dairy sectors.

The one bright spot is South America, where Deere said it expected industry sales would increase 10 percent to 15 percent in 2010.

The company's shares were flat $52.29 in early trading on the New York Stock Exchange.

(Reporting by James B. Kelleher; Editing by Maureen Bavdek and Derek Caney)

Manufacturing