Dow AgroSciences LLC, a unit of The Dow Chemical Company (DOW), and Syngenta (SYT) have united in a bid to offer refuge-reducing trait stacks to corn growers across the U.S. and Canada. The collaboration will focus on making high-performing trait stacks more widely accessible to independent seed companies through Syngenta’s fully-owned subsidiary, GreenLeaf Genetics. The entities have not divulged the financial terms of the deal.
Under the pact, the companies will offer high-performance trait stacks such as the Agrisure Viptera 3220 and Agrisure 3122 to the corn growers, helping them to boost productivity. Moreover, Syngenta’s Agrisure traits and Dow AgroSciences’ Herculex traits will be out-licensed through GreenLeaf, serving as the primary contract for seed companies.
The union of two advanced trait technologies will offer the corn growers across the U.S. and Canada greater option and genetic combinations to reduce the required number of refuge acres, maximize yield and control multi-pest complex insects including corn earworm and corn borer.
Multi-pest complex insects damage roughly 238 million bushels of corn alone in the U.S. and costs $1.1 billion in lost yield and grain quality every year. Agrisure Viptera trait is proven to be highly effective against corn earworm, one of the biggest threats to corn production in the U.S.
Indiana-based Dow AgroSciences is a leading provider of crop protection and plant biotechnology solutions. Syngenta, headquartered in Basel, Switzerland, is a leading specialized chemicals company focused on boosting crop yields and food quality globally.
Revenues from Dow’s Agricultural Sciences segment jumped 14% year over year to $1.8 billion in the most recent quarter, benefiting from new products. Sales of Seeds, Traits and Oils business soared 16%, driven by new seed technologies. Dow’s Corn business continues to see strong demand from farmers of SmartStax hybrids in North America and growing adoption of Herculex technology in Latin America.
Dow, which competes with EI DuPont de Nemours & Co. (DD), is benefiting from strong fundamentals in agriculture and food markets. The company’s performance in the emerging markets remains strong and we expect this to continue moving ahead. A string of innovative products in its pipeline also adds to its strength.
We currently have a long-term Neutral recommendation on Dow Chemical, which is in sync with a short-term Zacks #3 Rank (Hold).
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