The Next Wave

As you may have already read on p. 38 (“Hot Commodities”), Eric Sfiligoj and I attended the Commodity Classic last month in Tampa. For those who might not know, this is the official national meeting for the American Corn Growers Association, the American Soybean Association, and for the first time this year, the National Association of Wheat Growers. It’s a mix of business, education, and fun, and serves as the “final fling” before growers return to the field. They do hold the meeting in warm weather cities at the end of the cold winter, after all.

Anyway, I always feel a bit like a spy at this meeting — it’s built for the grower community, so as a representative of the distribution channel, I always feel like I’m getting a taste of the mood of the grower, as well as how products are marketed to row crop growers when the retailer isn’t “in the room,” so to speak.

Most of the things that struck us as interesting or important are highlighted in the aforementioned feature, but I wanted to give a little more ink to developments in one particular area — basic manufacturers.

Not too long ago, as Roundup Ready technology and Bacillus thuringiensis-infused crops swallowed up billions of dollars in revenue from crop protection manufacturers and the retail distribution channel, we were all wondering how much we really needed from basic manufacturers anymore. Common sense would dictate that at some point, Mother Nature would catch up and challenge the incredible performance of these technologies, requiring revolutionary new chemistry and biotechnology developments. But for a while, they seemed invincible.

Of course, along comes Roundup-tolerant and -resistant weeds, followed quickly by Asian soybean rust, soybean aphids, leaf beetles, and other pests. Not to mention the biofuels revolution that’s feeding the current drive for higher yields that not long ago could not deliver enough profit to provide adequate payback.

Enter basic crop protection and biotech research companies, who at Commodity Classic were remarkably bullish on their long-term developments and eager to share with attendees. Du­Pont talked about its Optimum GAT trait, which will provide glyphosate and ALS inhibitor tolerance, while Monsanto explained its YieldGard VT technology, which it says will lead to performance-enhanced stacked trait hybrids in its next generation YieldGard releases.

Dow AgroSciences, BASF, Syngenta, and Bayer CropScience also discussed loaded pipelines and big future developments anticipated as soon as the 2008 season and projected as far down the road as 2013. In discussing some of these longer range forecasts for the basics, one exec I talked to insisted that we’re simply in the midst of one of those cycles, when years of research across companies is beginning to come to fruition at the same time.

Regardless of the precise reason why, for retailers the pipeline should factor into the kind of partnership retailers forge with basic manufacturers. R&D is what sets them apart from the pack, and what they are bringing to agriculture over the next five to seven years should have play in any decision about the company and products that retailers represent.   

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