Print This PageQ&A with Carle Casale
Transcript: Q&A with Carle Casale
Why is Monsanto purchasing Delta and Pine Land Company?
If you think about the business that Monsanto is in and the company that Monsanto
has become, we’re focused on two things: Number one, creating the best
genetic potential that we possibly can in a seed, and the second thing is
protecting that genetic potential as much as we can. And we’ve done
that in corn, soybeans, and cotton. By acquiring Delta and Pine Land, we
gain access to the broadest and deepest genetics library in the world that
we can add our tools to increase productivity and bring better seed to farmers.
We already had the traits and will continue to have more that will help to
protect that yield that we’ll create through the genetic potential
in the seed. Another way to say it is, if you’re in the business of
libraries and seed potential, genetic potential is a proxy for a library,
then you’d want the biggest library that you can possibly have, and
that’s the attraction of Delta and Pine Land.
Monsanto has said as a company that we are focused on four core crop areas: corn, soy, cotton and vegetables, and if you’re going to focus in those areas given who we are as a company, you want to have access to the broadest and deepest genetic libraries that you can. We’ve secured that in corn, we have it in soy, we had the opportunity to acquire that in vegetables and we now had the opportunity to acquire that in cotton germplasm as well. And Delta and Pine Land’s got the broadest and deepest cotton germplasm library in the world, and if you’re going to make better seeds, it’s tools in a toolbox, right? You want to have the most tools in that toolbox you possibly can to give yourself the absolute best chance of creating the best products.
What can the cotton growers expect?
In the very near term, the opportunities that farmers will see is to be able
to get more Monsanto traits in their Delta and Pine Land varieties of choice,
and we’ll be able to do that fairly soon over the near to midterm.
The longer term things that we’ll be able to do is to bring them better-yielding
cotton varieties because agronomics are going to be the underpinning of any
success that a cotton farmer is going to have. We’ll also be able to
look at other things, like fiber quality, that are becoming increasingly
important to foreign buyers and be able to bring them better products that
allow them to be highly competitive in a global market.
Why is this important for US cotton
producers?
If you take the broader picture and then focus it down to today, the fact that
somebody looked at the cotton industry and said, I am willing to invest a billion
and a half dollars in the future of the American producer, and I would point
out this is an American company. Well over 90 percent of this company’s
earnings derived from the United States come from the success of American producers.
So having a partner that is that committed to my future success I think should
be very encouraging to American cotton producers. And through that commitment
will come products that yield better, perhaps disease resistance, and ultimately
thinking more about fiber quality as an industry because increasingly that
is going to become more important to who our customers are and decreasingly
those customers are in the United States. A vast majority now reside in Asia.
In the very near term, we’ll be able to get Monsanto technology, Roundup
Ready Flex/Bollgard II, in the best-yielding Delta and Pine Land varieties
so that farmers can benefit from those choices sooner than they otherwise would
have.
How does this acquisition address concerns about global competition?
I think the most important thing if I am an American cotton producer and I
am thinking about this is the fact that somebody looked at a situation where
there was a company with well over 90 percent of their business in the United
States and that business was becoming increasingly challenged by foreign
competition, the fact that somebody saw enough to invest a billion and a
half dollars in this business to take a bet on the American farmer, I think
would be a very, very encouraging thing. Now, given the fact that we’ve
made that investment, we’re going to do whatever we can to protect
and grow that investment, and that’s going to be through bringing better
products to keep American producers competitive in that market. And the buyer’s
China. Probably 90 percent of the fiber now in the world is spun in China,
and we need to get very focused on what our largest customers and industry
want to buy. And the reason that we are looking at the prices that we are
right now is about half of last year’s crop is still not sold, and
so we’re going to have to be effective competitors on a global basis.
I think that the underpinning has to be productivity and consistent, reliable,
quality so we are the preferred buyer at a competitive price. I think is
going to be a key to the success of this industry long term. So it’s
got a lot of challenges, but we’re very, very motivated to help solve
those challenges.
How does cotton fit in to Monsanto's crop portfolio?
The way that I think about cotton is, well over a decade ago Monsanto made
a significant bet on investing in technology for cotton at a period in time
when nobody else was even looking at cotton, and I see it today that we’ve
literally doubled down and spent another billion and a half dollars to further
our commitment and investment in cotton. So there’s lots of talk of
the challenges that the U.S. cotton industry faces today, and those challenges
aren’t lost on us at all. But we see it as an opportunity, as a way
to create greater value for American producers and allow them to compete
effectively in a highly competitive global market.
