NEWS
NON-CROP IN THE NEWS
Beyond agriculture 
COMPANIES early 1990s and withdrew Benlate from
Recently, I attended a workshop that included sale worldwide in 2001. It has incurred
an interchange between a group of companies n Syngenta has acquired an exclusive costs of some US$2,000 million over these
that are involved in supplying the industry with licence to US pharmaceutical firm Merck disputes and recovered about US$275
market data and intelligence and many of the
& Co’s manufacturing technology for the million through insurance.
major international crop protection companies. Discussion developed around
insecticide, abamectin. The deal covers the
the subject of non-crop markets and how negative the phrase ‘non-crop’ is
use of the insecticide for crop protection, n Bayer CropScience’s crop protection
as a description. The discussion then progressed to the names by which the
seed treatments, turf and ornamentals. sales rose by 1.5% to €1,434 million
business is labelled internally by many companies – professional products,
The Syngenta forerunner, Novartis, (US$1,880 million) in the first quarter
environmental products, home care and materials protection. It was even
acquired Merck’s agrochemical business of 2007. Revenues were up by 6.5% after
proposed by one delegate that a prize should be offered for a more positive
in 1997. The two companies entered into currency and portfolio adjustments.
name for this collection of growth markets.
a long-term supply agreement, but no High commodity prices, expansion of
I have used the title ‘Beyond agriculture’ this month, as I am sure for many
manufacturing facilities were involved in crop areas due to the biofuel boom and
companies this is exactly what these markets represent. They do not
the acquisition. an early start to the European season
operate through the same customer clusters; they do not have the same
drove growth, Bayer says. Herbicides,
channel value chains; and as I have commented many times, the customers
n BASF labels Brazil’s agricultural fungicides and seed treatments
in the value chain often have fundamentally different business drivers from
future as “absolutely positive”. Brazil performed particularly well.
the suppliers, especially the companies who provide products and services
to the consumer. Add to this, the complexity of additional brand names Bayer’s agchem Q1 sales by region (e million)
and differentiated formulations and some companies may consider this
to be one step too far beyond agriculture. Most of the major international
Region 2006 % change 2007
agrochemical companies do not think this way – they have experience in
Europe 623 + 16.1 723
managing at least some of the market sectors. Many have been involved for North America 380 -23.2 292
several years either through building their own business usually around a
Asia/Pacific 207 -8.7 189
single strategic molecule or as a result of the consolidation process, which
Latin America/Africa
provided a business with a product range and an experienced team through
Middle East 203 +13.3 230
acquisition.
Total 1,413 +1.5 1,434
But what of the companies that have been building their businesses based
on the ever-increasing availability of off-patent materials, either divested by
the majors or from additional production in India, China and other markets?
leads the way in major crops and has a n The US University of Connecticut
There may be a limit to the market share that can be taken in crop protection
growing role in the biofuel industry, BASF start-up company, Venomix, is relocating
markets and, as a result, beyond agriculture there is an opportunity to
agricultural products president, Michael to Kalamazoo, Michigan, following the
diversify. For many of these companies who meet up every year at the BCPC
Heinz, says. “The initial signs of recovery completion of a first round of venture
conference, beyond agriculture is still a mystifying maze, not a market full of
in the present harvest and the medium- financing with Southwestern Michigan
future potential.
term expectations are very good for First (SWMF) Life Science Venture Fund.
Brazil’s farmers,” he adds. The company The level of funding was not disclosed,
It is often quoted that when the non-crop market was last valued in 2003, it
is to launch products for the cotton and but the University of Connecticut reports
had reached US$15 billion. The latest research currently being analysed may
horticulture markets, Latin America vice- that SWMF Life Science Venture Fund
well support the reality of an even larger market. For many of these non-crop
president of agricultural products Walter has invested US$2.25 million in Venomix.
focused companies, it is their own national markets in Asia that are providing
Dissinger says. Venomix is developing novel insecticides
the growth engine of this demand. And what of the Japanese companies
that mimic spider toxins. It is seeking to
– they dominate most non crop markets in Japan, but with the exception
n Syngenta has agreed to acquire a develop products for crop, non-crop and
of Sumitomo have so far failed to seriously penetrate markets outside their
49% stake in the Chinese seed company, veterinary use.
home base?
Sanbei Seed (Longhua, Hebei province),
If we look at the entire universe of manufacturers and formulators operating
for an undisclosed sum. The transaction n Indian generic agrochemical
in the crop protection market, the reality is that the added value that can be is subject to approval by the Chinese company Insecticides India (Delhi) is to
achieved from opportunities beyond agriculture is still poorly understood. authorities. Maize seed accounts for over establish new production and research
Maybe that is in part to do with the negative name ‘non-crop’. Please send me 90% of Sanbei’s sales. facilities with the proceeds of an initial
your suggestions for a more positive name and I promise we will discuss with
public offering in May. The company
the Agrow magazine editorial team a new headline banner for this column.
n DuPont has agreed to settle several offered 3.2 million equity shares with a
lawsuits over its fungicide, Benlate face value of Rs10 (US$0.24) for a price
(benomyl), relating to alleged birth defects range of Rs97-115 share. The offer would
rob@xenexassociates.com 
and crop damage. The company has been represent some 25% of the company’s
www.xenexassociates.com
contesting numerous lawsuits since the capital.
 July 2007  •  www.agrow.com
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