Next week in Southern California, a diverse group of political, not-for-profit organizations and business leaders are sitting down at Fortune Brainstorm Green to brainstorm ideas and approaches on how to work together to feed, clothe and fuel human activity and to do so in a sustainable way.
Monsanto CEO Hugh Grant and Executive Vice President Jerry Steiner will participate in two separate sessions to discuss agricultural approaches to the global food dilemma. You can watch their presentations and participate live via the Web.
Below is a preview of what you can expect to hear.
Earlier this year, at the World Economic Forum in Davos, companies, development organizations, ministers of agriculture and the environment, and environmental groups discussed what agriculture in the 21st century must look like in order to find solutions to hunger, poverty and environmental degradation – issues that affect not only our quality of life but can contribute to civil unrest.
The participants identified goals where agriculture must succeed to meet global needs:
- Improve food security
- Increase agricultural productivity in an environmentally sustainable manner
- Generate economic growth and opportunity.
The key is that the three goals are interrelated and must be pursued simultaneously to address the requirements of billions of more people in the coming decades.
Monsanto’s Contribution
We believe that Monsanto can be a key contributor to one pillar in particular—helping farmers worldwide increase agricultural productivity.
It’s a discussion Monsanto has been having for a couple of years now: the need to produce more and better quality crops while using less resources—all while ensuring farmers reap the benefits. Our goal is to help provide farmers with the necessary tools so they can keep up with the growing demands of society in a sustainable way. Tangibly, this means doubling yields – that’s the output per acre of crops – by 2030 in soybeans, corn, cotton and canola (using the year 2000 as a baseline). And reducing by 1/3 (per unit produced) the key resources such as land, water and energy required to grow these crops.
When this is achieved, it will be the equivalent of putting an additional 145.5 million acres into production – an area about the size of Texas.
What does that look like?
Here’s what we think is possible in corn, soybean and cotton here in the U.S.:
To see what these numbers look like in other countries (and how farmers are making progress), check out our nifty global map on www.producemoreconservemore.com.
How can it be done?
Not through biotechnology alone. Though biotech gets most of the attention, breeding and agronomic practices have always played a crucial part in improving yields. You can think of it this way (using corn as an example):
- Breeding is mating different corn plants together to create a new corn hybrid that has the best genetic potential, whether that be for yield, disease resistance, etc.
- Biotechnology protects that potential from outside factors that would reduce yield. Those include insect damage and weed competition as well as weather factors. Some farmers think of it as insurance.
- Agronomic Practices – These are the elements within a farmer’s control to again protect and promote that yield (such as irrigation practice, planting population, etc.
Here’s a graphical representation of how those three elements will improve corn yields by 2030:
Historical yield trend would bring the endpoint of the corn yield trend line to approximately 200 bushels/acre on its own. The combination of biotechnology, breeding and agronomic practices will incrementally increase the rate of gain.
It can be done. For example, in the U.S., farmers are doing a great job of increasing their productivity.
- Since 1948, they have increased crop production by 137% by adopting innovative farming practices.
- Between 1970 and 2009, the average corn yield has doubled from approximately 75 bushels/acre to more than 160 bushels/acre in 2009.
- That has reduced the number of acres in production by 25% allowing society to divert the land to other uses.
We hope farmers around the world will have the same choices and access to the innovative tools that U.S. farmers use every day.
Reflection on Earnings
April 9, 2010
On Wednesday morning, I sat with my coffee cup in hand and listened via Webcast to our CEO Hugh Grant talk with investors and analysts about Monsanto’s second quarter earnings. At the same time, I had my Tweetdeck and Google Reader up to scan and follow the latest comments from our farmer customers. It was refreshing to hear what our execs said in that call, because it matched what I’ve been seeing online from our customers.
What Monsanto executives said this week—including CEO Hugh Grant—was the result of feedback they picked up from meeting with farmers across the U.S. for the past several months. What we heard consistently from these farmers is that they find value in our products and in our technology. But we also heard that our pricing methods on new products such as Genuity Roundup Ready 2 Yield and Genuity SmartStax can be an obstacle for customers who want to try new technologies.
This feedback is partly why we reset our financial goals yesterday, acknowledging that the goal of doubling gross profit from 2007 to 2012 was unlikely.
As Mr. Grant told analysts yesterday:
“We refuse to achieve our growth objectives to the detriment of our customers….we can either make a stubborn push for the targets we’ve set for ourselves and strain those valuable customer relationships – or, we can do more to work with our customers and let the growth come more naturally. That will change some things. I’d like to say it’s pure altruism, but the reality is it’s the right thing to do for the business – today and tomorrow.”
Moving forward, we’ll be looking at ways we can provide customers with more options to evaluate the technology and then decide the right combination of products for their farm.
**Please note: The comments section has been shut down temporarily until Monday, April 12 due to some maintenance on the site. If you’d like to leave a comment on this post, please check back on Monday.
Pardon Our Dust…
April 7, 2010
We will have to temporarily shut down comments to the blog until Monday, April 12 due to some maintenance we are doing on the site. Keep those comments on the tips of your fingers for next week!
An Official Update at the Unofficial Start of 2010 Planting
March 31, 2010
Co-authored by Janice Person and Nick Weber
Cotton emerging from the soil
The unofficial start of planting season got under way today, as the U.S. Department of Agriculture released its 2010 Prospective Plantings report. It’s an annual report that the agency issues each March 31 as its best estimates on what farmers may plant for corn, soybeans, wheat, cotton and many other crops.
The quick highlights:
- A record 78.1 million acres of soybeans
- 88.8 million acres of corn (second-highest on record)
- 53.8 million acres of wheat (lowest since 1970)
- 10.5 million acres of cotton (15 percent higher than 2009)
According to Kansas farmer Darin Grimm, the Plantings report is one of the couple big reports that he follows.
“I pay a fair amount of attention,” said Grimm. “It moves the market. We look to see what affect it will have on prices, so we pay a fair amount of attention. In this case, the numbers are about as expected.”
Illinois farmer Doug Martin said the report gets the year going for farmers.
“I have always had my doubts about the USDA reports because I have always wondered about their accuracy,” he said. “However, it does set a benchmark for the year. I was able to attend the March report a few years ago in (Washington) D.C., and I think that they do their best to get an accurate number.”
The report isn’t swaying Grimm and Martin to change acreage intentions, as they expect their corn and soybean acreage mix to remain the same. The past couple days’ weather has kicked things into high gear on the Grimm farm. After a wet fall and snowy winter, the 70-degree days are just what the Midwest and South needed. Grimm said fall fieldwork has been pushed back to this spring.
“In my area, typically, we will have all our anhydrous (fertilizer) on corn acres in the fall and also do fall herbicide spraying,” he said. “Once we have those operations done, we’re committed to planting corn on those acres.”
That means the Kansas farmers could switch some acres to soybeans, which is why the report is an estimate.
“Right now, there’s a fair amount of nitrogen that needs to go on corn acres, which is unusual for us. It was so wet all fall and winter that we simply didn’t get it down. So if it stays wet, those acres can go to beans more easily.”
Down south, planting is underway from South Texas to South Carolina. Texas was singled out as the state with the greatest move to cotton, accounting for an extra 600,000 acres of the 10.5 million forecast for 2010. The increase in cotton acres was something farmers have been discussing and optimistic about for months, according to Barry Evans who farms in Kress, Texas on the High Plains.
“Here north of Lubbock we’re cotton & grain so we can move easily how much we plant of cotton, corn and sorghum. I’ll be planting more cotton and expect that as you move north toward Amarillo there will be a greater movement into cotton,” Evans said. The winter provided good moisture on the High Plains and good weather now has lots of people doing field work. He adds that he looks forward to seeing more producers next week at the Plains Cotton Growers annual meeting.
In South Carolina, Thad Wimberly has been busy planting corn in a strip tillage system. Early spring rains have delayed him a bit but this week has been productive. “As far as out look we will take 200 acres out of corn and put in more cotton.”
This increase in cotton acres is something most states expect this spring according to the USDA, estimating that only Kansas, Louisiana and Arkansas will see drops.
There’s one common theme among all farmers on March 31 though: excitement for planting.
“We are really excited,” Martin said. “After the last two wet springs. we would like to ‘enjoy’ this planting season. Although with all of last fall’s work still left to do, it will probably be chaotic, unless it quits raining until the middle of May. We are hoping to get some field work started by the weekend, and if we miss Saturday’s rain we will be ready to go full steam ahead.”
“It’s always exciting,” Grimm said. “It’s easy to be optimistic in the spring.”
Optimism in an Out of Office Message
March 30, 2010
Planting takes specialized equipment on a small scale for research and development efforts.
Friday afternoon I was trying to reach a coworker. I looked on the office instant messaging system and a rush came over me – there was an out of office message saying he was planting just outside of Corpus Christi, Texas. Immediate reaction? Pick up the phone and call to see how it’s going!
It’s a high tech version of what has happened for generations. It used to be conversations at the general store or maybe the church social. It passed from neighbor to neighbor and town to town. Now, the news gets out quickly & electronically – and for those of us on or connected to the farm, hearing it creates a rush of excitement. Optimism strikes.
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