Monsanto Management: Updates on Growth Drivers in 2018
Monsanto’s (MON) management has provided updates for the coming year on new products and market penetration, which are expected to help the company drive growth in 2018. Let’s look at some of those updates.
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During the earnings call, management said that its “Climate FieldView platform is expected to reach 50 million paid acres globally.” In the United States, it expects to launch its NemaStrike Technology across six to eight million acres. The company also said that for its soybean product Roundup Ready 2 Xtend, it expects to double its penetration on the back of what appears to be a supply sufficiency. The company also expects further penetration of its Disease Shield hybrids in some markets.
Growth through merger
Despite these products and technologies, Monsanto sees growth opportunity from its merger with Bayer. Mature companies (NANR) such as Monsanto, PotashCorp (POT), Agrium (AGU), and DowDuPont (DWDP) have seen a challenging environment lately on the back of weakness in the agribusiness market. These companies have resorted to mergers and acquisitions to drive or rejuvenate growth.
Monsanto could benefit from expanded market penetration through Bayer. PotashCorp will also get access to the retail market with its merger with Agrium.
In the next part, we’ll take a closer look at the Monsanto-Bayer merger.