Natural Foods Merchandiser

Syngenta acquires Monsantos Sunflower seed division

St. Louis, Mo.-based Monsanto finalized a deal Monday to sell off its global hybrid sunflower seed assets to Switzerland-based agri-business Syngenta AG for $160 million.

Syngenta further strengthens itself as the world leader in sunflower seed sales with its purchase of assets and assumed liability of Monsanto’s sunflower seed division. Syngenta had more than $200 million in sunflower seed sales for 2008, while Monsanto posted $75 million.

The cash and debt free deal includes Monsanto’s sunflower seed germplasm, development and hybrid sunflower seed breeding.

Monsanto spokeswoman Danielle Stuart said Monsanto sold its sunflower seed division because sunflower seeds are not a strategic crop for the U.S. She said Monsanto will continue to concentrate on corn, soybean and cotton.

Bill Freese, Center for Food Safety science policy analyst, said this sale is interesting because it’s the first instance he can remember reading of a Monsanto divestiture. He said historically Monsanto has bought many seed companies growing into a world leader in agri-business.

But Freese said he believes this growth may have instigated the sale. According to Freese, the Justice Department, under the new administration, has shown interest in the concentration of business in agriculture.

“Monsanto is the big player in genetic engineering,” Freese said. “They have about ninety-percent of the genetically engineered traits and crops worldwide, so this may be a preemptive measure to avoid punishment down the road.”

However, this is not Monsanto’s first divestiture. In 2008, Monsanto divested its Posilac business and in 2007 Monsanto divested its swine genetics business.
Latin American and European markets are where a majority of Syngenta’s growth will occur, both key regions for growing sunflower seeds.

Sunflower oil is primary used in foods. The high value vegetable oil is low in saturated fat. Grown on 24 million hectares worldwide, Russia, Ukraine, Argentina, France and Central Europe are its leading producers. (One hectare is equal to about 2.4 acres.) Seventy five-percent of the $700 million sunflower seed market comes from developing countries, according to Syngenta company materials.

Nearly all U.S. sunflower plantations use hybrid sunflower seeds that have an increased yield, pest resistance, uniformity, stalk quality and self compatibility when compared to traditional sunflower seeds, Freese said.

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