Just like political news, any announcement that could be misconstrued by ag audiences may be now slated for release on Friday - so the media will have to take a breath or two before opining. For your consideration, this announcement today.
Dow AgroSciences LLC, and Monsanto today announced a cross- licensing agreement that breaks new ground in the commercialization of gene stack technology. The agreement is aimed at launching SmartStax(TM), featuring eight different Dow AgroSciences and Monsanto herbicide tolerance and insect-protection genes. This technology is expected to be available to corn growers by the end of the decade. [More]I'm still wrapping my mind around this. My knee-jerk reactions:
- Traits will soon be standardized in one humongous package - try buying something without all 8 traits.
- Unless there is a battle for market share, pricing power will extract the maximum marginal revenue from seed corn buyers.
- Monsanto and Dow must be remarkably confident about US energy policy. With ethanol profits slipping and soybean prices climbing, what would an RFS expansion failure mean to corn prices and seed profits? Then again, owning the market means never having to say you're sorry.
- Is there no sense of panic at Pioneeer/DuPont? I realize they have been and are deeply invested in research, but can those products hit retail fast enough to make a difference? Where was management as Monsanto built the wall around them?
- Forget refuge. Given the current lackadaisical industry attitude to the supposedly serious problem of Bt resistance, I had guessed (wildly, I admit) that products were at hand that would make refuge unnecessary. This now seems to be the case. Consequently, I will be listening skeptically to bug scientists who tell me 2-3 years of "refugeless" corn growing will select for a rootworm beetle that will baffle SmartStax.
- How close to monopoly does the trait/seed market have to get before attracting government attention? Are two choices sufficient? Have we arrived at Microsoft (corn) and Apple (corn)?