Monsanto Weighs In On Glyphosate
19 December 2008 Editor’s note: We asked Dean Hendrickson, lead of the company’s global glyphosate business, non-branded for his views on the glyphosate situation. An 18-year Monsanto veteran, Hendrickson’s current responsibilities include understanding the global glyphosate arena and leading the company’s global strategy for its glyphosate supply business. He has held a number of positions within Monsanto, ranging from sales management, account management, U.S. Roundup brand management, and U.S. markets channel strategy lead to director of marketing & operations for the firm’s animal ag business. In addition, “I essentially grew up in agriculture as our family was an independent retailer in the upper Midwest,” he says. “Together these experiences have allowed me to appreciate the complexity of the global chemistry market from a number of distinct aspects and appreciate the importance and scale of a product like Roundup
in the agricultural industry.”
What do you expect in terms of price volatility for glyphosate next year?
In 2008, a number of agricultural inputs have been (and will continue to be) impacted by strong macro-economic trends for commodity crops, driven by an increasing and more affluent populations, particularly in China and India. We believe demand for glyphosate – particularly our Roundup branded product – will continue to increase globally and should be relatively unaffected by current global financial problems. Weed control is necessary for optimizing yields, and conservationtillage is more cost-effective than using conventional practices: Roundup and other glyphosate products fit well here. Volatility is typically driven by demand and supply imbalances, and until the global financial situation stabilizes, it appears that volatility may be something that all industry participants must plan for and effectively manage.
Do you anticipate any supply/shortage issues in 2009?
The supply discussion is tough, as people are looking across all glyphosate sources, not simply Monsanto’s supply, and it’s difficult for us to project what may occur with other suppliers. However, we are committed to meeting our commitment of being a consistent supplier. Monsanto’s manufacturing team is working 24/7/365 to run all of our plants at full capacity. We are attempting to build some strategic inventory of Roundup in 2009 to allow us to serve our customers better, have greater flexibility in our supply chain, and be better prepared for any potential supply interruptions.
Are there any regions in the world that the glyphosate market is expanding or declining? If so, why?
In the past several years, adoption of conservation tillage practices and Roundup Ready crops, as well as rate adjustments, combined to increase demand for Roundup and other glyphosate products significantly. We anticipate that global demand for glyphosate will continue to grow in the context of a robust
agricultural economy.
Although we have seen growth in most world areas, the highest projected growth rates are in the North America and Latin America Regions. For 2009, this will be driven by further adoption of Roundup Ready technology, more land into agricultural production, and recapturing any impacts from floods in the U.S.
Midwest last year.
What are Monsanto’s plans for expanding production of glyphosate?
In April 2008, we announced a $196 million dollar investment for expansion of our Roundup brand agricultural herbicides manufacturing facility in Luling, Louisiana, US, to enhance our ability to supply the growing demand for glyphosate. This investment provides for new process improvements at the facility, helping to provide a reliable supply of the world’s leading agricultural herbicide, Roundup brand, to our customers. These improvements are expected to be completed in time for the 2010 planting season.
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