Monsanto Co., the world’s biggest seedmaker, plans to boost investment in China to a level similar to Brazil because of a newly drafted government policy, Chief Technology Officer Robb Fraley said.
Foreign companies now are encouraged to work with Chinese seed producers on consolidating the industry and raising crop yields, Fraley said today on a webcast from the Bank of America Merrill Lynch 2012 Global Agriculture Conference in Bal Harbour, Florida. Monsanto plans to expand a venture with China National Seed Corp., a unit of Sinochem Corp., he said.
“Some things have changed rather dramatically,” Fraley said. “There are never any guarantees but things are lining up. You can see this becoming the next Brazil.”
Monsanto’s sales in Brazil have climbed 77 percent since 2007, to $1.28 billion last year, according to data compiled by Bloomberg. China, the world’s second-biggest corn grower, now offers favorable regulations and protections that help address concerns about protection of intellectual property, Fraley said.
“It will be a longer-term investment,” Fraley said. “You have to think Brazil 7 or 8 years ago and what we have done to create that business we enjoy today.”
Monsanto also is “on the verge of a breakthrough” in Argentina that would allow the company to be paid for its genetically modified soybeans, similar to Brazil where grain handlers collect fees for Monsanto, he said.
“We’ll declare victory when we sell that first bag of seed,” Fraley said.
Monsanto currently sells modified corn seed in Argentina.