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7-Business: Monsanto fighting for market control

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TITLE:  A) Monsanto of the US buys all of Sensako
        B) Monsanto reaches deal on GM crop
SOURCE: A) Business Day, South Africa, by Louise Cook
        B) Australian Financial Review, by Cathy Bolt
           edited and sent by Agnet, Canada
DATE:   A) December 14, 2000
        B) December 15, 2000

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A) Monsanto of the US buys all of Sensako
Life science group snaps up remaining 49% of SA company

SOUTH African agricultural business Sensako became a wholly owned 
subsidiary of US life science group Monsanto yesterday. Monsanto runs a 
$66m business in SA, 40% of which is crop chemicals, 47% seed sales and the 
remainder, biotechnology. Monsanto bought out a remaining 49% shareholding 
in Sensako for an undisclosed amount after the US-listed company obtained a 
majority shareholding in Sensako last year.

The move bears out an increasing trend among local agricultural companies 
to link up with large overseas concerns to be able to survive international 
competition and operate in globalised farm markets.

Sensako, which was formed as a seed co-operative in 1959, transformed 
itself into a company two years ago. One of its key strategic decisions at 
the time was to attract overseas capital and link up with a major 
international investor with the view of remaining firmly entrenched in the 
technology race, former Sensako MD Willie Maree said. Monsanto, a world 
leader in biotechnology and the development of genetically modified seed, 
pursued the deal with Sensako as, among others, a way of bringing 
biotechnology into SA and Africa.

Monsanto has operations in another 28 African countries. Two years ago it 
introduced genetically modified maize and cotton seed for commercial 
production in SA for the first time. It had already broken into 44% of the 
genetically modified cotton seed market among small-scale black farmers in 
that time.

In January, Monsanto is set to open SA's first R5,5m seed drier in 
Lichtenburg in North West. The in-taking facility would reduce the risk of 
crop damage to the farmer and means that new improved maize cultivars would 
now be able to come off the field between 60 to 90 days earlier than before.

"The acquisition of Sensako will contribute to Monsanto's commitment to 
investing in SA agriculture and delivering state-of-the-art technology to 
farmers, enabling them to compete in the world market," Monsanto director 
Dave Westphal said. "Through total shareholding, Monsanto can now expand 
its services to SA farmers and to farmers in the whole of Africa."

Maree said all Sensako minority shareholders mostly farmers approved of the 
buy-out. Sensako is not listed, but the farmers obtained unlisted shares in 
Sensako when the co-operative became a company.

Westphal said Monsanto would continue to seek partnerships with 
agricultural co-operatives world wide. "In a country like SA where no white 
maize seed can be imported, it is imperative that we consistently provide a 
reliable service in terms of quality production and distribution to 

Maree was offered an as yet undisclosed senior management position in the 
new company. He said the two existing brand names, Sensako and Carnia, 
would remain unchanged and Sensako's headquarters would move from Brits to 
Johannesburg. Monsanto also recently became part of the US pharmaceutical 
company, Pharmacia. In SA, it commands 45% of the maize seed market and 
almost all of market in wheat seed.


B) Monsanto reaches deal on GM crop

Monsanto has, according to this story, struck an agreement with regulatory 
authorities to resolve an embarrassing over-planting this season of its 
pest-resistant cotton, Ingard, Australia's first genetically modified crop. 
The story says that bungle resulted in about 20,000 more hectares of Ingard 
being planted than the 165,000 ha maximum approved by the National 
Registration Authority for Agriculture and Veterinary Chemicals.

But the NRA has now agreed to Monsanto's request for a variation to the 
ceiling, raising it to 180,000ha. That follows extra steps taken by 
Monsanto to reduce a potential build-up of insect resistance to Ingard, the 
main reason for limiting the area planted to about 30 per cent of total 
cotton plantings. These include extra planting of insect refuge crops such 
as unsprayed cotton and other plants attractive to the target heliothis 
bug. Monsanto has also paid farmers to plough in several thousand hectares 
of crop to bring the area back to the new ceiling.

The story adds that though Monsanto volunteered the breach to the NRA, the 
breakdown in controls is ill-timed for those trying to rebuild community 
confidence in the regulatory system for transgenic technology. It follows 
several incidents this year when Monsanto and Aventis failed to properly 
dispose of seed and trash from field trials of GM crops.

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