Seed corn orders strong, supply intact -- Monsanto
Monsanto Co. (MON) is seeing strong North American demand as farmers plan to increase their corn acreage in 2012, company officials said Thursday.
"Early orders indicate momentum is strong," CEO Hugh Grant told investors in a conference call following first-quarter earnings. He compared the situation to last year's, when strong early orders proved to be an indicator of growing demand for the entire season.
Grant added that tight supplies of corn seed isn't a problem for the company but could be a bigger issue for smaller companies. Hot, dry weather in 2011 hurt corn seed production and has raised worries among some farmers and dealers about a shortage.
"We feel good about our own position, and are ready, willing and able" to supply customers, Grant said.
Monsanto's stock has jumped Thursday after the company reported first-quarter earnings surged on growing South America sales. The company also provided an update on its research and development pipeline, reporting advances in 14 different areas as its technologies converge across various platforms.
Rob Fraley, chief technology officer, said that biotech traits that boost yield are the "next frontier" for the industry, and that Monsanto is well-positioned in this area because of a collaboration with BASF Corp.
Monsanto will be expanding farmer trials of drought-tolerant corn in 2012. The company has applied for approval from key importers, a crucial step to having a market for the product. Fraley said importers should approve drought-tolerant corn in 2013 and 2014.
Monsanto stock was recently up 5.2% to $76.41 a share.
-By Ian Berry, Dow Jones Newswires; 312-750-4072; email@example.com
(END) Dow Jones Newswires
January 05, 2012 10:44 ET (15:44 GMT)
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