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GM seed suppliers forge ahead
Posted: Thursday, October 16, 2008 10:10 am
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Monsanto's revenues climbed 35% in the last year. Origin Agritech, Ltd., China's leading ag biotech corporation, has doubled its market penetration efforts for the upcoming selling season to include 1,000 demonstration lots. French seed producer Vilmorin is aiming to launch second-generation GM seeds in 2012. Farmers enthusiastically embrace GM crops, and Monsanto's model of success may be inspiring others.

It's hard to argue with success, or how Monsanto leads the pack.

Monsanto sees seed prices increasing, at more than its targeted 16%-18% range next year. Chief Executive Hugh Grant said that, despite the gyrations in commodity prices, demand fundamentals remain intact for the company's maize, soy and vegetable seeds and traits, which offer protection against pests and drought.

Origin Agritech continues to see seed prices increasing, as the demand continues to be driven by demand for maize. Of particular importance is the increase of the incomes of the growing middle class and the demand for higher-quality food products in China.

The company also has GM phytase maize in the R&D pipeline, which is nearing commercialization. Releasing seed to farmers seems like it may be a particularly bold move, as there are no indications the company is seeking approval for the product in foreign markets. Without foreign approval, a 'contamination' event similar to the StarLink debacle would seem likely.

The current structure of the market makes this unlikely in the near term. Domestic demand for maize is so great that China is unlikely to export any of the maize it grows. This factor significantly cuts the political/economic risks of releasing seed to farmers, and puts Origin Agritech in position to be China's version of Monsanto -- at least, domestically.

Of all the factors involved in national and international seed politics, none seem to favor Vilmorin's plans. The company is based in France, where government policy is hostile to GM crops. In contrast to China and the US, that means, no domestic market.

Vilmorin will have to rely on expatriation of its technology. According to Marie-Josee Cougard at Les Echos, the company aims for GM maize to account for half of its sales of seeds for field crops.

While France has made it illegal to grow GM maize, the market for GM maize seed elsewhere in Europe has grown dramatically.

One third of Vilmorin's research is dedicated to biotechnology, a proportion that is expected to rise to 40 percent within four or five years. The second-generation GM seeds being developed by the group will feature resistance to threats such as salt, dryness and cold.

It's beginning to look like seed companies around the world are eager to replicate Monsanto's success.

Interesting times are ahead.
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GMO (noun) 1. An acronym for the term, 'Genetically Modified Organism'. 2. A plant, animal or microbe with a genetic code which has been intentionally altered, such as through forced evolution (see selective breeding); through random mutations induced with radiation or chemicals (see mutagenesis); or through the selective transfer, promoting or silencing of specific genes (see genetic engineering). 3. Most generally, any descendant of a primordial urbiote. (See evolution.)

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