NEWS OF THE W EEK
AGRICULTURE: Syngenta, Bayer,
and BASF expand arsenal of pesticides and seeds
S
USTAINED HIGH PRICES for agricultural com-
modities are spurring acquisitions and other investments by Syngenta, Bayer CropScience, and BASF in seeds, fungicides, and biobased pesticides. In contrast to tepid growth projections for traditional chemical markets, the market for crop protection products and seeds is expected to rise steadily over the next five years. Syngenta is offering $517 million to acquire Devgen, a Belgian firm that specializes in hybrid rice strains and biological insect control based on RNA interference. “Rice is critical to global food security, and we expect to make a key contribution to improving productivity,” says Davor Pisk, Syngenta’s chief operating officer. In a smaller biopesticide deal, Syngenta snapped up Pasteuria Bioscience, a research-oriented firm developing nematode control products based on the soil bacterium Pasteuria spp. The agreement includes an up-front payment of $86 million and deferred payments of up to $27 million. And Syngenta has agreed to build an $85 million seed and crop protection product facility in Krasnodarskiy Kray, Russia. Overall, the firm has raised its end-of-decade sales target to $25 billion, almost double its 2011 sales and up from a previous target of $22 billion. Bayer CropScience says it will invest $6.4 billion between 2011 and 2016 in R&D to plump up its pipeline of seeds and crop protection products. In August, Bayer completed the $500 million purchase of AgraQuest, a maker of biological pest control products. It credits the deal with “securing its foothold in the biologics market,
which is expected to triple to almost $4 billion by 2020.” In addition, Bayer says it will spend more than $2.5 billion on new crop protection chemical production capacity as well as seed breeding, production, and processing facilities to meet rising global demand. The firm reported 21% growth in seed sales in the first half of the year and expects seed sales growth to exceed that of other agricultural products for the foreseeable future. Meanwhile, BASF plans to invest more than $250 million to scale up production of fungicides, including strong sellers F500 and Xemium, at facilities in Schwarzheide and Ludwigshafen, Germany, and in Sparks, Ga. The company earlier announced a $1 billion deal for Becker Underwood, an Iowa-based producer of biological seed treatments. A common driver of much of the new investment is the desire to add biological control products to existing chemical crop protection lines, says Matthew Phillips, principal at the consultancy Phillips McDougall. Stricter regulation of chemical pesticides in Europe, a rise in integrated pest management practices, and the growing popularity of seed treatments are building the market for biological products, he says. Phillips adds that for agricultural products in general, “we do expect industry growth to continue steadily over the next five-year period, on top of continuous significant improvement over the last five years.”—
Bayer CropScience produces seeds in this greenhouse in Astene, Belgium.
BAYER CROPSCIEN CE
SPENDING BOOM IN CROP SCIENCES
MELODY BOMGARDNER
FEDERAL BUDGET Congress passes measure to keep government running through March In what has become an annual exercise, Congress has passed a budget measure to avoid a federal government shutdown. The so-called continuing resolution for 2013 will fund all government programs at fiscal 2012 levels for the first six months of fiscal 2013, which starts today. The House of Representatives passed the continuing resolution on Sept. 13 by a vote of 329-91. The Senate vote came just after midnight on Sept. 22, with 62 voting for the measure and 30 against it. President Barack Obama was scheduled to sign the bill after C&EN’s press time.
“I support this measure even though it is far from perfect,” said Senate Appropriations Committee Chairman Daniel K. Inouye (D-Hawaii) before the upper chamber’s vote. “I would say that it is not a particularly good bill, but passing it is much better than allowing the government to shut down over a lack of funding.” Likewise, the Senate Appropriations Committee’s top Republican expressed frustration. “The resolution represents a lost opportunity,” said Thad Cochran (R-Miss.). “We have lost the opportunity to provide agencies with at least some
WWW.CEN-ONLIN E .ORG
11
OCTOBE R 1 , 20 1 2
certainty about funding for this fiscal year. We have lost the opportunity to make informed judgments about which programs are effective and deserving of additional resources, and which programs should be reformed or terminated.” Congressional leaders and the White House announced their support of a continuing resolution to avoid the threat of a shutdown during the run-up to the November elections. Although the House passed six of the dozen 2013 appropriations bills, the Senate failed to pass any of them.—SUSAN MORRISSEY
