Monsanto Confident in Operational Path to 2012 Financial Goals

In covering the company's operational path through 2012, Begemann highlighted the three key drivers for Monsanto's growth: the launches for its Genuity SmartStax corn and Genuity Roundup Ready 2 Yield soybean products and trait penetration in Latin America.

3 Dec 2009 --- It's all about the mix, Monsanto Company's Brett Begemann, executive vice president of Seeds & Traits, has told investors at Citi's Basic Materials Symposium in New York. Key to the company's success will be the mix shift that will be created as farmers choose to upgrade to next-generation technologies, Begemann said. He also discussed Monsanto's 2010 orders to date, which preview this shift and continue to track with the company's expectations for the U.S. business.

In covering the company's operational path through 2012, Begemann highlighted the three key drivers for Monsanto's growth: the launches for its Genuity SmartStax corn and Genuity Roundup Ready 2 Yield soybean products and trait penetration in Latin America. Successful implementation of these drivers will provide farmers step-changing products to enhance on-farm production and in turn enable Monsanto to reach its commitment of doubling its 2007 gross profit in 2012.

"We've set out ambitious goals, but we can achieve them," Begemann will tell investors. "These products are true game-changers. The benefits they provide - simplicity, protection, higher yields and increased profitability - give our customers a reason to choose to upgrade the products they select for their farms. As we earn farmers' business, we achieve the mix lift that will propel us to our 2012 targets."

Covering the three growth drivers, Begemann will say the company expects an initial commercial opportunity of more than 4 million acres in 2010 for Genuity SmartStax corn. Monsanto expects an unconstrained supply by 2012, which will enable the company to meet market demand a year earlier than originally anticipated. Monsanto also expects a more rapid conversion to the Genuity Roundup Ready 2 Yield soybean platform and recently increased its launch-year expectation for 2010 to 8 million to 10 million acres.

Begemann also discussed the ascension of the Latin American corn market as Argentina and Brazil gain momentum in the adoption of biotech traits. Both countries have granted breakthrough approvals for core corn traits and are on the front-edge of adoption curves for these traits.

Outlining Monsanto's go-to-market approach for corn, Begemann explained the variety of means Monsanto employs to reach farmers with its wide-ranging toolkit of corn products. Monsanto offers the industry's most comprehensive package of corn products with reduced refuge double- and triple-stack products in addition to Genuity SmartStax.

"We understand the business of farming and we know each farmer makes decisions differently," Begemann said. "That's why we have so many choices in our portfolio, to offer products that are right for every farm."

Begemann highlighted the company's cotton and vegetable businesses as well, discussing the penetration of second generation traits and new germplasm classes for cotton in the United States and the potential for breakthroughs in the vegetable business.