ST. LOUIS – Monsanto has entered into a unique partnership
with a European company to develop and market agricultural microbial products
Executives from St. Louis-based Monsanto and Danish company
Novozymes said in a joint press conference here that the deal will have a big
impact on farming. Novozymes President and Chief Executive Officer Peter Holk
Nielsen described the deal in grand terms.
“We want to transform global agriculture with this
alliance,” Nielsen said. “I believe we are writing ag history.”
Robb Fraley, executive vice president and chief technology
officer at Monsanto, echoed Nielsen’s enthusiasm.
“I really think it’s game-changing,” he said. “This is
really an unprecedented alliance, especially on the biological side of the ag
industry. It’s an opportunity to rewrite standard practice on how to discover
new biological products, how to commercialize those products and how to create
more value faster for our farmer-customers.”
As part of the agricultural biologicals industry, microbial
products represent about $2.3 billion in annual sales, according to a joint
statement provided by the companies. They are derived from various naturally
occurring microorganisms such as bacteria and fungi.
Microbials are designed to protect crops from pests and
diseases and enhance plant productivity and fertility. According to Novozymes,
they offer sustainable, cost-effective solutions that can increase yields with
“We see an untapped potential for biological solutions in
agriculture,” Nielsen said.
“These solutions can ultimately help farmers worldwide to
produce more with less in a sustainable way. From day one, we’ll bring
sustainable technology to millions of acres across the world.”
Monsanto has set a goal to double yields in key crops such
as corn and soybeans by 2030, in order to meet growing global demand. The United
Nations projects that world population will reach 9.6 billion by 2050.
Fraley believes biologicals will complement the company’s
core business of plant breeding, biotechnology and improvements in management
practices. Monsanto has been working on biologicals for two years.
“Today, agricultural biologicals are being used by millions
of farmers,” he said. “We’re full believers that there is an increasing
opportunity as we develop this into a technology that can make for more
significant yield increase for many more farmers.
“It demonstrates how important a commitment to sustainable
agriculture has become to the industry and beyond. There is demand on the market
for these kinds of products, and we’re thrilled by the opportunity to offer
farmers even more choices than ever before. We believe Novozymes is an excellent
partner to work with us and our farmer-customers.”
Novozymes has been in the business seven years. The company
focuses on bacteria, fungi and yeast.
“For years, we’ve worked together with customers on how to
develop and apply microbial solutions,” Nielsen said. “We’re good at innovation.
We’re good at finding new solutions, scaling them up and delivering biological
products. A decade ago, we thought that these capabilities could add value in
agriculture. Today, we take the vision to the next level.”
He cited as one example fungus applied to seeds before
planting. The fungus grows along the roots of the plant and makes more of the
phosphate in the soil available to the plant, which increases yield and saves
farmers money on phosphate fertilizer.
The deal has special appeal to Monsanto because of the more
streamlined approval process applied to biologicals.
The company suffered a setback earlier this year when the
federal Animal and Plant Health Inspection Service announced it will conduct
environmental impact statements on crops genetically modified to be resistant to
the herbicides dicamba and 2,4-D, delaying the rollout of such products.
“These products have a different regulatory framework and a
different timing to the marketplace, so they’ll enjoy a cycle time that is
faster across the globe,” Fraley said. “That’s one of the attractions. This
builds on our core capability in biotechnology and genomics, but it opens up a
broader crop and global market, and that’s really compelling to us.”
Novozymes products are being grown on 40 million to 50
million acres of farmland. Nielsen said there has been little pushback from
countries, largely because the products are natural.
“The regulatory regime around the world is generally faster
with microbes compared to other products to be approved for use in ag,” he said.
“Generally, we’re not running into issues on having products approved in
different regions around the world. There are different timelines.”
As part of the deal, Monsanto will pay Novozymes $300
million for its microbial capabilities.
Monsanto will conduct field testing, registration and
commercial rollout. Novozymes will take the lead on scaling and