GENET archive


7-Business: Battle on the U.S. GE seed market

------------------------------- GENET-news -------------------------------

TITLE:  Monsanto, Pioneer Battle for Seed Market
SOURCE: Associated Press / ABC 7 News, USA
DATE:   02 Mar 2006

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Monsanto, Pioneer Battle for Seed Market

ST. LOUIS (AP) - The battle of the biotech giants heated up this week,
with Monsanto Co. and Pioneer Hi-Bred moving to strengthen their hold in
the multibillion-dollar market for genetically engineered seeds.Des
Moines, Iowa-based Pioneer Hi-Bred was announcing Thursday that it will
release its own brand of "Roundup Ready" pesticide-resistant corn and
soybean seeds by 2009. The seeds would allow Pioneer to compete head-to-
head with Monsanto in a product line that is a pillar of Monsanto's business.

On Wednesday, St. Louis-based Monsanto said it paid $8.7 million for two
regional seed-dealing companies. The acquisition could help Monsanto
compete against Pioneer Hi-Bred's national network of about 5,500 sales

This week's developments are the latest chapter of a David and Goliath
competition. Monsanto is the biotech seed leader by far, said Frank
Mitsch, an analyst with BB&T Capital Markets. Pioneer Hi-Bred trails as
a distant second in the marketplace, even though it is a division of the
chemical giant DuPont Co.

Pioneer's new biotech seeds are the first to be wholly owned and
developed by Delaware-based DuPont, said Bart Baudler, a senior
marketing manager for Pioneer Hi-Bred. Their release is part of Pioneer
Hi-Bred's broader plan to quit paying Monsanto licensing fees to use
genetically engineered traits.

"We're quite excited that this is the beginning of several products ...
that will allow us to go head to head with Monsanto," Baudler said.

A handful companies dominate production of genetically engineered crops,
which were planted on roughly 123 million acres of U.S. farmland last
year. Developing the seeds is a long and expensive process, sometimes
taking a decade to move inventions into the marketplace.

Pioneer Hi-Bred's new strains of corn and soybeans still have regulatory
hurdles to clear before they can be sold in the United States, Baudler
said. The vast majority of tests have been passed, with some field
trials remaining, he said.

Pioneer wouldn't reveal the brand name of the new product before
Thursday's announcement, but the seeds are broadly called GAT, or
glyphosate ALS tolerant seeds. Glyphosate is the scientific name for
Roundup, while ALS refers to another family of herbicides.

So-called Roundup Ready plants are genetically engineered to survive
exposure to Monsanto's Roundup herbicide. Baudler said Pioneer's new
seeds will be resistant to Roundup as well as other herbicides.

Monsanto has no shortage of new products coming down its research and
development pipeline, Chief Technology Officer Robert Fraley told
investors during a recent presentation. Monsanto plans to release a new
generation of Roundup Ready plants that are also resistant to common pests.

Monsanto is beefing up its sales force to pitch new products. In 2004,
it formed a holding company called American Seeds Inc. with the goal of
buying up regional seed dealers.

ASI has purchased 13 seed brands, including the acquisitions announced
Wednesday, said Monsanto spokeswoman Lori Fisher. The newest additions
are Gold Country Seed, based in Hutchinson, Minn., and Heritage Seeds,
based in Rensselaer, Ind.

Fisher said ASI is just one of three avenues that Monsanto uses to sell
its seeds. The company also sells through its own brand names Asgrow and
Dekalb and licenses its genes to companies like Pioneer Hi-Bred.

In an interview late last year, Pioneer Hi-Bred President Dean Oestreich
said the company's broad network of sales representatives was an
advantage in competing against Monsanto, which is a relative newcomer to
the seed business.

                                 PART II
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TITLE:  Monsanto's American Seeds, Inc. Announces Two Strategic
        Acquisitions To Support Locally-Oriented Business Model
SOURCE: Monsanto, USA
DATE:   01  Mar 2006

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Monsanto's American Seeds, Inc. Announces Two Strategic Acquisitions To
Support Locally-Oriented Business Model

ST. LOUIS (Mar. 1, 2006) - Monsanto Company's (NYSE: MON) American
Seeds, Inc. (ASI) subsidiary announced today it made two strategic
additions to its family of regional brands. The additions are expected
to further bolster ASI's ability to help serve its farmer-customers with
a technology-rich, locally-oriented business model.

In separate transactions, ASI acquired Gold Country Seed, Inc., based in
Hutchinson, Minn., and Heritage Seeds, based in Rensselaer, Ind. Gold
Country Seed, Inc., serves farmers in the northern Corn Belt. Heritage
Seeds serves farmers in the eastern Corn Belt.

"These companies are important additions to our ASI business model and
our continued support of farmers," said Ernesto Fajardo, vice president
of Monsanto's U.S. crop production business. "ASI represents a distinct,
high-touch, regional approach to the marketplace. We look forward to
enabling these regional companies to bring greater germplasm and trait
innovation to their local markets than ever before."

Dennis Plummer, ASI president, welcomed both Corn Belt companies'
commitment to serving farmers. "These companies have a strong track
record of serving their farmer customers and delivering high-quality
products," said Plummer. "We look forward to working with these
companies and supporting their commitment to deliver the newest
technology in the best germplasm."

Monsanto acquired both companies in cash transactions totaling $8.7
million. The specific terms of the individual transactions were not
disclosed. Collectively, these two companies represent approximately 0.4
percent of total U.S. corn and soybean seed sales.

American Seeds, Inc. (ASI), which was formed by Monsanto in 2004, serves
as a holding company for regional seed companies that market primarily
corn and soybeans. ASI provides support for these regional seed
businesses with capital, genetics and technology investments. These
investments allow the operating companies of ASI to more directly
connect their customers to significant innovations in genomics-based
breeding and other new technologies while continuing to operate
autonomously and locally, providing great services to their customers.
For more information on ASI, see:

Monsanto Company is a leading global provider of technology-based
solutions and agricultural products that improve farm productivity and
food quality. For more information, please visit the company's web site

European NGO Network on Genetic Engineering

Hartmut MEYER (Mr)
news & information

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