Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Equities  >  Xetra  >  BASF SE    BAS   DE000BASF111

BASF SE

(BAS)
  Report  
Real-time Quote. Real-time Tradegate - 07/23 05:48:15 am
62.945 EUR   +2.75%
03:50aBASF : Extends Appointments of Three Board Members
DJ
07/17Johnson Matthey battles lower profit at its biggest unit
RE
07/17Bearings maker SKF's profit falls, reassures on Chinese autos
RE
SummaryQuotesChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsOfficial PublicationsSector newsMarketScreener StrategiesAnalyst Recommendations

How a Philippines regulator stymied DowDuPont's global seed launch

share with twitter share with LinkedIn share with facebook
share via e-mail
0
02/12/2019 | 01:22am EDT
FILE PHOTO: Soybeans fall into a bin as a trailer is filled at a farm in Buda

WINNIPEG, Manitoba/CHICAGO (Reuters) - A Philippines regulator poses an unexpected obstacle to DowDuPont's launch of a new line of genetically engineered soybeans in the United States as the company challenges Bayer AG's decades-long dominance of the U.S. seed market.

China's January approval for imports of DowDuPont's Enlist E3 soybeans - amid the U.S.-China trade war - had raised hopes that the seeds would be broadly available for the U.S. spring planting season. It took more than five years for the company to win China's approval.

But DowDuPont now says widespread sales of Enlist seeds in the United States, Canada and Brazil may be delayed until the 2020 planting seasons unless the Philippines regulator moves quickly.

The Philippines issued new regulations for genetically modified products such as Enlist in 2016, and the process involves input from more government officials. Some applications now take years to process.

Although China has historically been the No. 1 importer of U.S. soybeans, the Philippines last year was the top buyer of processed U.S. soymeal, used primarily to feed livestock.

A slow start would be a missed opportunity for DowDuPont because farmers are eager to reduce their reliance on Bayer, which acquired seed giant Monsanto last year.

Enlist soybeans, marketed by DowDuPont's agriculture unit Corteva Agriscience, will eventually shake up the $40 billion U.S. soybean market - half of which is controlled by Bayer's Xtend brand. Enlist is the first soybean genetically modified to withstand sprays from three popular weed chemicals - 2,4-D, glyphosate and glufosinate.

Xtend soybeans are popular for their robust yields but have drawn complaints, lawsuits and regulatory scrutiny after the dicamba herbicide that farmers use with the Xtend crops drifted to neighbouring fields and killed plants that were not genetically modified to resist it. The U.S. Environmental Protection Agency last year approved use of dicamba for two more years, adding restrictions on how it can be used.

"There's definitely a market for Enlist soybeans, and some producers have been waiting for market approval for some time now," said farmer Monte Peterson, of Valley City, North Dakota.

But the uproar over dicamba drift could also potentially benefit Bayer's Xtend because Enlist does not tolerate dicamba.

"There's a significant number of growers who are planting Xtend from a defensive position," said Carl Peterson, president of Peterson Farms Seed in North Dakota.

China's purchases of U.S. soybeans have plummeted since Beijing imposed tariffs on imports in response to an array of duties slapped on Chinese imports by U.S. President Donald Trump. But U.S. spring soybean plantings are nonetheless expected to remain only slightly below last season's levels in a sign that farmers hold out hope for a resolution of the U.S.-China trade war.

China's January approval of Enlist soybean imports, along with those of four other genetically modified crops, was seen as a goodwill gesture by some U.S. agriculture industry advocates.

'BUREAUCRATIC' PROCESS

In the Philippines, the tougher rules imposed by regulators came after the nation's Supreme Court demanded an overhaul of genetically modified crop approvals, acting on a petition by environmental activists.

"There are more players, and you know how bureaucratic the process is," said Geronima Eusebio, head of biotech for the government's Bureau of Plant Industry, adding that personnel still need training in the new regulations. "We are doing our best."

The timeline for a decision on Enlist soybeans is unclear, Eusebio said, although the bureau now has all required assessments from government ministries.

Bayer expects to expand Xtend's market share of U.S. soybean acres to more than 50 percent this year regardless of whether Enlist becomes broadly available, said Ryan Rubischko, Bayer's North America portfolio lead for dicamba.

Last year, the Philippines regulator didn't approve BASF's LibertyLink GT27 soybeans until summer, said Scott Beck, president of Atlanta-based seed dealer Beck's Hybrids.

"We're in a similar waiting pattern until Philippines provides that blessing, and we don't know when that will be," he said.

BAGGAGE FROM MERGERS

DowDuPont faces other entanglements, some resulting from the consolidation of agrochemical companies in recent years.

DowDuPont, the product of a merger last year, inherited a contract with Bayer that effectively limits how aggressively it can sell Enlist. DowDuPont will sell Bayer's Xtend through 2023 as part of a patent infringement settlement between their predecessor companies DuPont and Monsanto in 2013.

The settlement should help Bayer "suppress the competition" by tying up Corteva staff and logistics that could otherwise focus on Enlist, said Bill Johnson, professor of botany and plant pathology at Purdue University.

Corteva's global soybean portfolio manager, Mike Dillon, declined to say how much of Bayer's soybeans his company is required to sell.

OPPORTUNITY AND RISK

Enlist's eventual arrival is already yielding opportunities for other companies.

Nufarm Ltd, the second-biggest 2,4-D supplier in the United States after DowDuPont, is opening a new plant in Mississippi in April, and expanding a Chicago-area facility.

Nufarm is already running its plants at close to capacity and will need to scale up production quickly at its new plant to meet demand for Enlist, said Ken Barham, its vice-president of customer and brand marketing. He expects, however, that it will take a year or two for Enlist to gain traction.

The delayed launch has been costly for smaller seed companies.

Mustang Seeds in Madison, South Dakota, grew Enlist E3 soybean seeds for the past three years in case China approved imports of the crop, president Terry Schultz said.

When that didn't happen, the company kept a portion of the harvest to grow more seeds and took the rest to a crushing plant that would keep the products out of export markets, he said.

"It's a money-losing situation," Schultz said.

(Reporting by Rod Nickel in Winnipeg, Manitoba and Tom Polansek in Chicago; additional reporting by Enrico Dela Cruz in Manila and Michael Hirtzer in Chicago; Editing by Caroline Stauffer and Brian Thevenot)

By Rod Nickel and Tom Polansek

Stocks mentioned in the article
ChangeLast1st jan.
BASF SE 2.97% 63.15 Delayed Quote.1.42%
BAYER AG 2.50% 61.02 Delayed Quote.-1.59%
EURO / BRAZILIAN REAL (EUR/BRL) -0.14% 4.1871 Delayed Quote.-5.30%
FEEDER CATTLE?FUTURES (GF) - CMG (ELECTRONIC)/C1 0.07% 142.275 End-of-day quote.-5.96%
LIVE CATTLE (LE) - CMG (ELECTRONIC)/C1 0.02% 108.475 End-of-day quote.-13.78%
LME NICKEL CASH -1.77% 14425 End-of-day quote.38.17%
NUFARM LIMITED -0.85% 4.65 End-of-day quote.-23.15%
SOYBEAN MEAL FUTURES (ZM) - CBE (ELECTRONIC)/C1 -0.96% 308.2 End-of-day quote.1.63%
SOYBEAN OIL FUTURES (ZL) - CBE (ELECTRONIC)/C1 -1.10% 27.79 End-of-day quote.2.00%
SOYBEANS FUTURES (S) - CBR (FLOOR)/C1 -1.47% 888.25 End-of-day quote.2.15%
SOYBEANS FUTURES (ZS) - CBE (ELECTRONIC)/C1 -1.50% 888 End-of-day quote.2.15%
share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on BASF SE
03:50aBASF : Extends Appointments of Three Board Members
DJ
07/17Johnson Matthey battles lower profit at its biggest unit
RE
07/17Bearings maker SKF's profit falls, reassures on Chinese autos
RE
07/15Swedish engineering group Atlas Copco calms demand jitters
RE
07/15OMV Invests EUR64 Million in New Unit at German Refinery
DJ
07/13German Business Stars Lose Luster -- WSJ
DJ
07/12TAKE FIVE : G7 - deep in the Woods?
RE
07/12German Companies 'Are Losing Their Importance' as Big Names Struggle
DJ
07/12MAKE OR BREAK : second-quarter results will test Europe's confidence
RE
07/12Daimler Shares Fall After Latest Warning
DJ
More news
Financials (EUR)
Sales 2019 62 895 M
EBIT 2019 5 138 M
Net income 2019 4 403 M
Debt 2019 17 838 M
Yield 2019 5,30%
P/E ratio 2019 10,9x
P/E ratio 2020 14,6x
EV / Sales2019 1,18x
EV / Sales2020 1,14x
Capitalization 56 385 M
Chart BASF SE
Duration : Period :
BASF SE Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends BASF SE
Short TermMid-TermLong Term
TrendsBearishBearishBearish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 26
Average target price 66,14  €
Last Close Price 61,39  €
Spread / Highest target 38,5%
Spread / Average Target 7,73%
Spread / Lowest Target -21,9%
EPS Revisions
Managers
NameTitle
Martin Brudermüller Chairman-Executive Board
Jürgen Hambrecht Chairman-Supervisory Board
Hans-Ulrich Engel Chief Financial Officer & Vice Chairman
Michael Diekmann Vice Chairman-Supervisory Board
François Diederich Member-Supervisory Board
Sector and Competitors
1st jan.Capitalization (M$)
BASF SE1.42%63 262
DUPONT DE NEMOURS INC-32.47%53 797
ROYAL DSM59.57%22 139
SASOL LIMITED-20.31%14 947
GROUPE BRUXELLES LAMBERT11.57%14 917
EVONIK INDUSTRIES AG18.76%13 476