26 June 2013 22:09 [Source: ICIS news]
HOUSTON (ICIS)--While North America remains its focus and source of profits, agribusiness titan Monsanto said Wednesday it sees the expanding markets of South America, namely Brazil, as essential to the company’s growth and success, especially in soybean sales.
Speaking to analysts during a Q3 earnings conference call, company officials said they feel Monsanto is setting the pace for development and its introduction of new seed varieties will assist South American farmers in the global agricultural markets.
President Brett Begemann said the company believes they have can eventually capture a 100m acre share of the available agriculture within these countries.
One of the main areas that Monsanto is focussed on is the launch of the newest variety of soybeans in Brazil, which accounts for more than a quarter of global soybean production and is forecasted to produce 82m tons (74m tonnes) in 2013.
Named Intacta, the variety is the first soybean offering that is glyphosate tolerant and insect protected with the intention to boost yields by allowing producers not only spray the herbicide Roundup but also not have to aggressively control soybean looper worms and bean caterpillars. Monsanto said the variety targets the primary pests but does not harm other insect populations or other organisms.
“With the upcoming Latin American planting season in sight, we are officially targeting around 3m acres for the launch of Intacta, which would make this not only the largest soybean trade launched today but it will effectively double our largest previous first-year opportunity. In addition we have been working with our customers in Brazil, and we will start rolling out official price cards soon in anticipation of our first-year sales,” said Begemann.
“It’s the pricing approach that we believe gives Brazilian farmers the right opportunity to see the value of our breakthrough new technology, while simultaneously supporting the opportunity for us from our fastest-ever soybean trade ramp-up.”
Begemann said Monsanto is already moving forward with a second generation of the variety that would bring about more quality yields and enhance the insect protection.
Questioned whether Monsanto is concerned over the recent political unrest in the country and if changes in the country’s agricultural policy could harm future earnings, Begemann said their position that Brazil’s leaders and its citizens recognize the importance of farming to the nation’s economy.
“We watch the relationship, but we don’t see any change on policy any time soon. I think the advantage we have is that we have an insight of Brazil and that we are producing and selling inside the country. And agriculture is a huge piece of the economy,” Begemann said.
“I like our position with the footprint that we have in Brazil. I think that gives us a little bit of foresight.”
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
Asian Chemical Connections