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Competition Threatens Monsanto as Biotech Crop King

01.09.2004
Zemědělství
Competition Threatens Monsanto as Biotech Crop King
KANSAS CITY, Mo. - The golden stalks of corn and lush green soybean fields that shape the U.S. farm landscape would not normally be described as battlefields.

But that\'s what they are turning into as the world\'s biggest agricultural technology companies wage a fierce fight for market share of biotech corn, soybeans and other crops.

And it\'s about to get bloody.

Facilitated by a series of acquisitions and favorable court rulings, Dow AgroSciences, a subsidiary of Dow Chemical Co. and Syngenta Seeds, Inc., a unit of Swiss-based Syngenta, the world\'s biggest agrichemicals company, are leveling a direct challenge to Monsanto Co., the acknowledged king of biotech agriculture.

\"Monsanto has had a monopoly,\" said David Brawner, owner of a Missouri-based arm of AgVenture Inc., an independent seed company. \"But I don\'t believe they can continue to be the dominant force they have been.\"

POPULAR BUT PRICEY

St. Louis-based Monsanto currently holds sway over more than 80 percent of the market for biotech soybeans and corn in the United States.

Monsanto technology results in seeds genetically modified to resist certain destructive insects and tolerate weed-killing treatments. The seeds are popular with many U.S. farmers because they help them harvest a bigger crop and reduce chemical use. But Monsanto\'s fees - being raised this year by more than 25 percent on some products - are a sore spot.

\"I\'m glad to see Syngenta and Dow come into the market. Monsanto needs more competition,\" said Iowa farmer Gordon Wassenaar.

Monsanto has deflected previous challenges with lawsuits and patent disputes. But Syngenta and Dow both have court rulings in their favor now and say they are pushing into the market with full force.

\"We\'re bringing superior technology to the market compared to what the competition has out there today,\" said Pete Siggelko, Dow AgriSciences vice president of plant genetics.

One of the first big challenges to Monsanto comes from a Dow corn seed dubbed \"Herculex,\" named for Hercules, the mortal son of the god Zeus, who slays an evil giant in Greek mythology. Herculex corn resists an array of harmful insects and competes against a line of Monsanto corn products called YieldGard. Monsanto has argued that it owns the technology that confers the insect-resistance. But courts have sided with Dow and Dow plans to launch a biotech cotton in 2005, followed in 2006 with a Herculex corn that also protects against rootworm.

Syngenta is coming at Monsanto with more. With a series of acquisitions of seed and technology companies under its belt, Syngenta is poised to introduce a range of specialized corn seeds.

Its top weapon is a glyphosate-resistant corn seed that would compete directly with Monsanto\'s \"Roundup Ready corn,\" a popular product that helps farmers control weeds and is one of Monsanto\'s key growth vehicles.

Monsanto has filed a patent infringement suit against its rival and it has told seed dealers they should destroy certain seed stocks that could help Syngenta\'s entry. But Syngenta said its seeds will be available for planting in the spring.

Syngenta is also planning to introduce corn that gives growers both glyphosate-resistance and protection against a destructive European corn borer pest, and it has a rootworm product in the works.

\"We know we\'re late to the market; that is clear,\" said Syngenta product development manager Rob Wilde. \"But we have a wonderful portfolio to create compelling offers.\"

ILLEGAL MONOPOLY ALLEGATIONS

Adding fuel to the fire, Syngenta filed a lawsuit in U.S. District Court in Delaware last month, claiming that Monsanto has obtained its market dominance illegally.

Monsanto defends its business practices and says Syngenta is infringing on Monsanto\'s patents. And Monsanto spokeswoman Lori Fisher said Monsanto does not fear the competition.

\"We believe the established benefits of our products and the significant experience we have gives Monsanto a leadership advantage,\" she said.

The biotech seeds business is key to Monsanto\'s future financial strength, company officials say. Monsanto has watched its hold on the herbicide market diminish dramatically after its patent on glyphosate expired, and company officials and investors say future profits depend on seed sales. Indeed, the company\'s stock has risen more than 58 percent over the last year as seed profits have grown.

As the corporate battles wage, farmers watch with interest.

\"We would love to see more companies be able to reach the marketplace with traits that have real broad appeal,\" said Nathan Danielson, the National Corn Growers Association\'s director of biotech and business development.


Story by Carey Gillam

REUTERS NEWS SERVICE
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