As Dow seeks growth, new Enlist crop/chemicals seen as key
Dan Kittle has spent more than a decade waiting for this day.
As the man in charge of research and development at Dow AgroSciences, the unit of Dow Chemical Co that develops agricultural seeds and pesticides, Kittle remembers the "big shock" when rival Monsanto Co unveiled a genetically modified seed in 1996 designed to be used in combination with a specific herbicide, a combination that rapidly led Monsanto to riches.
Since then, Monsanto has become the world's largest seed company with $15 billion in annual sales, up roughly 200 percent from a decade ago, and Kittle and a team of Dow researchers have been working to catch up.
In that quest, Dow has increased research and development spending 75 percent, expanded greenhouse space, also by 75 percent, and made 14 acquisitions since 2007.
With a string of new crop and chemical products in its pipeline, the company projects it will double revenues over the next five to seven years. For 2013, sales totaled $7.1 billion.
One key to Dow's rise in the agriculture seed and chemical kingdom is the company's new GMO seed and herbicide combination branded the "Enlist Weed Control System." U.S. regulators have indicated they are poised to grant needed approvals, and after more than two years of scrutiny, the U.S. Department of Agriculture's final public comment period closes on Tuesday.
"Enlist is the most important release we've had," said Kittle.
Dow pegs the market opportunity for Enlist at about $1 billion. It plans to offer Enlist corn and soybean, the two most widely planted U.S. crops, next year in concert with Dow's Enlist Duo herbicide, which the crops are engineered to tolerate.
"We are moving ahead assuming we will have regulatory approvals," said Tim Hassinger, vice president of Dow crop protection. "We feel very good."
Enlist is aimed at replacing Monsanto's biotech "Roundup Ready" crops, which make up roughly 90 percent of U.S. corn and soybean plantings every spring. Dow is currently a small player in both, with an estimated market share in U.S. soybean seed of about 2 percent and a 4 percent share in corn.
Monsanto's Roundup Ready cropping system has dominated U.S. agriculture because it is easy to use. Farmers can spray Roundup herbicide directly on top of their crops, then watch the weeds die and the crops flourish because a genetic alteration makes the crops impervious to the weedkiller.
But heavy use of Roundup has triggered an explosion of herbicide-resistant "superweeds" that farmers have found it hard to fight.
- Unmanned aerial vehicles advance agriculture
- Divergent livestock futures highlighted Wednesday's market action
- Update on corn and soybean acreage
- China's cotton growing area, yield expected to decline in 2014
- Farm auction in McLean County, Ill., drew 40 bidders
- Pesticide Safety Education program reaches a 50-year milestone
- U.S. GMO labeling foes triple spending in first half of this year
- Activists fighting Golden Rice even more in 2014
- Source shows half of GMO research is independent
- White House issues veto threat on bill to block WOTUS rule
- Stoller soybean research produces 214 bushels per acre
- Ag markets turned generally mixed Monday morning