What Corteva Agriscience CEO Says Farmers Can Expect From New Business
Jim Collins these days straddles the neighborhood’s newest company with old roots in the agricultural seeds and chemicals business. He is CEO of Corteva Agriscience, which split from DowDuPont this week to become his own company. Corteva Agriscience is the only company of the three resulting from the “merger of equals” between Dow and DuPont that focuses solely on agriculture.
Here’s her outlook for Corteva Agriscience and what farmers can expect.
Farmers will benefit from the efficiency of the merger.
Certainly, Corteva Agriscience is not a start-up, as its roots go back over a century. (Dow was founded in 1897, while the founding of DuPont dates back even further to 1802.)
Yet farming is now the whole show, and not just a division of a corporate conglomerate, he says. This means that no company resources are allocated to the non-agricultural divisions.
“Producers can be assured that 100% of the business goal and 100% of the way we deploy our resources can be focused on meeting the needs of producers around the world,” he said.
Corteva Agriscience now has a larger plant breeding program with improved genetic material, he says.
“All breeders will tell you (that the diversity of genetic material) is your ally when it comes to creating new and better products,” he says. “So having genetic material in the Pioneer system is a boost for us. We also received potent genetic material from Mycogen (an old brand of Dow).
“The second part is that there are operational synergies that allow us to eliminate redundant costs from the system,” Collins explains. “Together, we will be more streamlined and more efficient. We will eliminate waste and redundancy, and free up things for R&D (research and development) and new product development. We put the farmer-customer at the absolute center of everything we do.
Corteva Agriscience differs from mergers between other industry giants.
Corteva Agriscience isn’t the only kid on the seed and chemicals industry consolidation block these days. Bayer closed Monsanto in 2018 and ChemChina bought out Syngenta in 2017.
“We are the only ones who have brought together two chemistry organizations and two seed organizations,” explains Collins. “Others were just bolted together. One was a chemistry company linked to a seed company. (Bayer buying Monsanto.) The other (Syngenta) was acquired by the Chinese and that hasn’t really changed.
Collins says Corteva Agriscience has a larger pipeline that allows it to work with farmers to solve a wide range of problems.
The merger has also brought benefits on the way to market, he says. “Traditionally, DuPont had a route to market through the Pioneer sales system,” he says. “Pioneer has a high-touch and high-focus system. However, it only reached a third of the (seeds) market. The rest went through regional businesses and the retail channel.
Collins adds that access to these channels has increased under the Corteva Agriscience banner.
“Plus, what separates us (from Bayer-Monsanto and ChemChina-Syngenta) is our culture,” Collins says. “We have two American companies that were already similar. You can feel the excitement. I think our culture will really make a difference.
So far, the consolidation of regional brands from last year has suffered little.
“I was expecting us to hear about this (pushback), but I was pretty surprised,” Collins says. “It comes down to the promise of what Corteva brings to the market and the ability to tap into a much larger base of genetic material. This will keep those (remaining) marks concentrated. ”
Why Biotech Traits Will Help Prevent Starter Door Stumbles.
A similar excitement occurred in 1999, when DuPont completed its purchase of Pioneer. Coincidentally or not, Pioneer hybrids have suffered performance issues in many areas due to cracking and cracking issues. This cost Pioneer market share in corn.
“If you look at this story and think about the market share issues, it’s the fact that Pioneer was a seed company all of its history,” Collins explains. “They are a family of breeders who really appreciate what it takes to create the modern genetic material that works today. Every year from time to time you run into some breeding issues like the brittle or the green you find yourself in. But Pioneer got out of one of these issues fairly quickly.
“What it didn’t have was a set of biotech characteristics that would, on its own, allow it to propel itself forward,” Collins explains. “There was the belief that he could always allow these traits from others.”
However, it was also a way for trait developers not to allow these traits to be put into the hands of every seed company. This created market share problems for Pioneer, he says.
“As soon as Pioneer got a license for all of these traits, we went back to the kinds of market share they had in the past because they had better genetic material. You can have the best traits in the world, but if you don’t put it in the best germplasm, it won’t work.
Collins says Dow is bringing its internal proprietary traits to Corteva Agriscience, which will help reduce the company’s reliance on competing traits and invest more in research and development for the next trait development cycle.
Collins adds that Corteva Agriscience is looking beyond that, both in the insect and weed areas. “If you keep spraying the same products on the same weeds (or bugs), Mother Nature finds a way (to thwart it). We will have a program dedicated to the characteristics of herbicides and insecticides. ”