DuPont Expects Increased Global Seed Corn Share, Continued Agriculture Earnings Growth
Strong Pipeline and Superior Distribution System Will Continue to Fuel Growth and Generate Cash
NEW YORK.– DuPont Group Vice President James C. Borel said today he expects DuPont business Pioneer Hi-Bred to grow its global seed corn market share by at least 1 to 2 points in 2009 and he committed to grow compounded annual earnings for the DuPont Agriculture & Nutrition segment an average of at least 15 percent over the next five years.
“The DuPont Agriculture & Nutrition businesses are winning in the marketplace,” Borel said at the Goldman Sachs 13th Annual Agricultural Biotech Forum. “We just came off a record year and our pipeline, products, people and unique distribution systems are aligned to fuel our growth well into the future.”
Seed Market Share
Borel said robust seed orders point to global seed corn market share growth. “Our order books are full throughout key markets in the Northern Hemisphere while Latin America, Africa and Asia are poised to make big gains thanks to new products and traits,” he said.
He attributed the growth to strong product performance in 2008 coupled with enhancements to its industry-leading distribution system, including the hiring of more than 700 sales personnel in North America.
In Brazil, the world’s third largest corn market, Borel said Pioneer is better positioned than anyone to capitalize on the recent registration of Herculex® insect protection. “Brazilian farmers have been looking for a solution like Herculex® to increase their yields and reduce the number of times they need to spray for insects.”
Borel explained that the introductions of DuPont™ Rynaxypyr® insecticide and Y Series soybeans in 2008 were just the beginning of a procession of product launches from the company’s research pipeline that will continue to fuel DuPont earnings growth.
“Our pipeline is on track to deliver industry-leading technologies that will sustain our growth,” he said. “Many of these technologies provide clear advantages over what others are bringing to the market.”
Borel said that the company’s Optimum® AcreMax™ 1 insect protection system is expected to receive reduced refuge registration in 2009. “Pending regulatory approval, Optimum® AcreMax™ 1 products will be the first in-the-bag insect control solution for growers and will eliminate the need for farmers to plant a separate corn rootworm refuge. It will allow growers to easily comply with the U.S. Environmental Protection Agency’s refuge management guidelines and increase their productivity.”
DuPont also will launch another industry first as early as 2009 – the first biotech soybean trait with direct consumer benefits. High oleic soybeans will offer nutritional benefits to consumers and functional benefits to the food industry.
Other traits in the DuPont pipeline that are on the fast track for introduction:
* 2010 – Optimum® GAT® corn, for improved weed control options in corn.
* 2010 – Drought Tolerance I, a product offering with enhanced water use efficiency traits selected through molecular breeding validated in on-farm field trials.
* 2010/2011 – Seed Production Technology for improved seed corn quality and decreased seed production costs of more than 20 percent.
* 2011 – Optimum® GAT® soybeans that enhance weed control options for soybean growers and provide improved crop performance.
“These advancements along with our Accelerated Yield Technology™ and elite germplasm are allowing us to stay on track to increase corn and soybean yields 40 percent by 2018,” he said.
Borel added that a number of DuPont Crop Protection products also are advancing through the pipeline including new weed control options for Optimum® GAT® products, and highly effective insecticides and fungicides.
DuPont enhanced its seed distribution network in 2008 through the expansion of its Pioneer direct-to-customer field sales force and its new PROaccessSM strategy. The PROaccessSM strategy will increase Pioneer global seed market reach by getting its seed genetics on more acres through co-brands, second brands and investments. In the United States alone, the PROaccessSM strategy will allow Pioneer to have access to distribution systems that cover an additional 5 percent of corn acres.
2009 Outlook for DuPont Agriculture & Nutrition
“We are excited about the growth opportunities in the agricultural sector,” Borel said. “While not immune to the global financial crisis, the fundamentals of the agriculture economy are strong and DuPont is well-positioned to serve customers in the segment.”
Borel said DuPont Agriculture & Nutrition growth in 2009 will generate material free cash flow. He added that platform revenue is on track to grow by 6 to 8 percent per year over the next five years with earnings growing by an average 15 percent over that same time. Borel’s presentation is available in the DuPont Investor Center Leaving Pioneer.com.
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