Global Standard Needed

This past September, Dow AgroSciences received approval from the U.S. Department of Agriculture for its Enlist corn and soybeans traits, and in October, we cleared the chemical solution that goes with it, Enlist Duo.

For us, that’s a major event. We have been working, as you can imagine, on deregulation and all the different studies and submissions that it takes. The United States is a key component of our global strategy, and we’re very happy to finally receive these approvals
Several years ago, with the introduction of Roundup Ready technology, farmers did not see weeds as a primary concern. But that has been shifting over the past several years as we’ve seen weeds spreading, increased resistance and environmental challenges. Weed management has become more of a priority for farmers and they are spending more time trying to manage it.
Enlist comes as a very effective solution with a very innovative new approach to formulating 2,4-D, which is an old chemistry with a new outstanding formulation that allows 2,4-D to be used with reduced drift and volatility, which is very important for today’s world and environment. 2015 will see a limited release launch. We are calling it a commercial introduction.
In today’s international world with the global movement of grain, things are not as easy and simple as receiving an approval and going to market.
We are very respectful of global trade, and we are waiting for our final approval from China. The paperwork for this approval was submitted in November and hopefully, we’ll have good news soon. But in the meantime, we will have a stewarded approach.

“Hopefully both the regulatory authorities and the industry can work together and start proposing a global standard.”
— Rolando Meninato

 
First, there are protocols farmers must follow. Dow AgroSciences will be very careful where we present our Enlist program. Farmers must accept and sign these protocols before we do anything. Essentially, the use of Enlist will be limited to on-farm feeding in order to make sure that grain from Enlist corn and soybeans doesn’t end up in the grain channels.
There are two components to the Enlist brand. On one hand is the trait that’s in the corn, soybeans and hopefully, in the near future, cotton, too. On the other hand is the chemical solution, which is the new unique and proprietary 2,4-D formulation. This combination really enhances our presence in the marketplace in both the seed world and the crop protection world.
We know the journey has been a little bit longer than anticipated, but it’s been for all the right reasons. We are making sure we have all the deregulations needed around the world. We are making sure we have all the permits and information to be very safe on the grain trade.

Business in South America

In July, Dow AgroSciences agreed to purchase a company called Coodetec. We had been working with Coodetec for quite some time — both in corn and soybeans. They were one of our future licensees for Enlist. This was a very good opportunity to enhance our presence in Brazil not only with germplasm in soybeans, wheat and corn, but also outstanding facilities and a network of coops. Right now we are waiting on Brazilian Antitrust Authority and we know that takes time. Hopefully we will hear good news soon.
We have a very strong organization in Brazil. Brazil is one of our priority markets and the Seeds business is of increasing importance for the company in the country. With the pending acquisition Dow AgroSciences confirms the company’s overall strategy in Brazil to advance the development of its soybean program, strengthen the company’s position in the corn market, and enter the market for wheat seeds.

Entering Headwinds

The issue that’s going to be front and center for 2015 is that we are facing headwinds in terms of prices and shifting acres. As an industry, when you have these massive swings of millions of acres from corn to soybeans , it affects everyone.
If we look to the longer term, the combination of traits and global approvals — it has essentially risen to a much higher visibility by everyone. Hopefully both the regulatory authorities and the industry can work together and start proposing a global standard. It has been a desire for sometime, but with today’s international environment, it’s a need. I think that will catch a lot of attention during the next two to three years.