Here is an update on Monsanto and the GM wheat issue:
Date: Tue, 18 Mar 2003 05:33:47 -0800 Message-Id: <[EMAIL PROTECTED]> From: News Update from The Campaign <[EMAIL PROTECTED]> Subject: Monsanto in the news Content-Type: text/plain; charset="ISO-8859-1" Content-Transfer-Encoding: 8bit
News Update From The Campaign to Label Genetically Engineered Foods ----------------------------------------------------------------------
Dear News Update Subscribers,
Monsanto had a tough year in 2002 and this year isn't going much better. Monsanto stock lost about half its value last year and it dropped another 15 percent on Friday.
The drop on Friday was triggered by an announcement that the Justice Department is investigating Monsanto Co. for possible antitrust practices in the herbicide industry.
Then on Saturday, the U.S. Department of Agriculture (USDA) said it may impose strict requirements on Monsanto to make sure it does not sell genetically engineered wheat until foreign markets accept it.
Posted below are three articles. The first one is titled "USDA mulls strict rules for Monsanto biotech wheat." The second and third articles discuss the Justice department investigation over Monsanto's possible antitrust practices regarding herbicides.
While Monsanto is having a hard time, we should not underestimate their resiliency and ability to influence government agencies. The USDA knows there is global opposition to Monsanto's desire to commercialize genetically engineered wheat. So the USDA announcement is most likely designed to diffuse the opposition to genetically engineered wheat rather than damage Monsanto.
Since actions speak louder than words, time will tell whether or not the USDA follows through on actually imposing restrictions on Monsanto's genetically engineered wheat.
Craig Winters Executive Director The Campaign to Label Genetically Engineered Foods
The Campaign PO Box 55699 Seattle, WA 98155 Tel: 425-771-4049 Fax: 603-825-5841 E-mail: mailto:[EMAIL PROTECTED] Web Site: http://www.thecampaign.org
Mission Statement: "To create a national grassroots consumer campaign for the purpose of lobbying Congress and the President to pass legislation that will require the labeling of genetically engineered foods in the United States."
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USDA mulls strict rules for Monsanto biotech wheat
By Randy Fabi
WASHINGTON, March 15 (Reuters) - The U.S. Agriculture Department said on Saturday it may impose strict requirements on Monsanto Co to ensure it was abiding by its pledge not to sell biotech wheat until foreign markets accepted it.
Monsanto's "Roundup Ready" wheat, which would be the first genetically modified wheat in the world, is under review by the U.S. and Canadian governments and could be approved for commercialization within the next two years.
Critics have said consumer attitudes about genetically modified wheat are so negative that both domestic and foreign buyers are likely to shun all U.S. wheat if it is sold.
Even if the wheat is approved by the United States, Monsanto has promised not to sell it until at least Canada and Japan accept it. The St. Louis-based company said a secure segregation system must also be in place to ensure the separation of genetically modified and traditional wheat.
"We understand this is a sensitive issue and we will get the approvals before we market any of these products," Monsanto wheat expert Michael Doane told a biotech advisory committee that advises the National Association of Wheat Growers, U.S. Wheat Associates and Wheat Export Trade Education Committee.
The new Monsanto wheat has been engineered to withstand herbicide so weed control is easier for farmers. The United States is the world's largest producer of biotech crops. Corn and soybeans are its biggest sellers.
The USDA said Monsanto may have to meet certain requirements if and when the government approves the product.
U.S. wheat exporters currently sell their wheat to foreign markets with a USDA-approved statement saying no biotech wheat is commercialized in the United States.
"If we are going to continue to issue a statement, we need assurances that statement is correct," said David Shipman, deputy administrator for the USDA's Federal Grain Inspection Service.
USDA is considering a proposal to require that Monsanto submit to independent audits "from the top all the way down" to ensure no biotech wheat was being sold, Shipman said.
The company would also have to sign a statement before every marketing year that it would not commercialize the genetically modified wheat. And Monsanto would need to provide information so DNA testing could be conducted by USDA.
Monsanto could face felony charges if it knowingly violates any of these proposals, Shipman said. Monsanto said it was too early to comment on USDA's proposal.
Monsanto field-tested Roundup Ready wheat on 35 acres (14.16 hectares) in the United States last spring. Doane said it would plant some this year in Montana, North Dakota, and perhaps Idaho.
Growers and environmental groups last week filed a petition with the USDA demanding a moratorium on the Monsanto wheat.
03/15/03 18:58 ET
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Justice Department Opens Monsanto Probe
By JIM SUHR .c The Associated Press
ST. LOUIS (AP) - The Justice Department is investigating Monsanto Co. for possible antitrust practices in the herbicide industry, the agricultural and biotech giant disclosed in a regulatory filing.
St. Louis-based Monsanto, maker of the best-selling Roundup weedkiller, said in the Securities and Exchange Commission filing Thursday that the probe involves ``possible anticompetitive conduct in the glyphosate-based herbicide industry.''
Glyphosate is a key ingredient in Roundup.
Monsanto spokeswoman Lori Fisher said Friday the company believes that the Justice Department has requested information from various glyphosate marketers and distributors, and that Monsanto has cooperated with the government's ``very broad-based'' request for information.
Fisher declined to discuss specifics of the inquiry, including when the inquiry was launched or what details the Justice Department sought.
``From our standpoint, we believe we've acted appropriately, and we are cooperating with their inquiry,'' she said.
Justice Department spokesman Blain Rethmeier declined to discuss the matter or to confirm that the inquiry was launched, saying departmental policy bars such comment.
Monsanto shares fell $2.51, or 15.1 percent, to close Friday at $14.07 on the New York Stock Exchange.
Monsanto's Roundup sales - the nation's best-selling herbicide - have been under pressure since 2000, when the company lost U.S. patent protection for glyphosate. In a filing Thursday with the SEC, Monsanto said the patent expiration means the company would face increasing competition to its Roundup herbicides, specifically from generic makers.
Monsanto said it has five to 10 major global rivals to its agricultural herbicide products, with competition from local or regional companies also potentially significant.
Given that, Monsanto said it historically has reduced Roundup prices in various markets, in addition to offering discounts, rebates or other promotional strategies to compete.
``However, there can be no guarantee that price reductions will stimulate enough volume growth to offset the price reductions and increase revenues,'' Monsanto said.
In a separate statement Friday, Monsanto reaffirmed its full-year 2003 earnings estimate and said it expected that as much of 90 percent of its profits will come in this year's first half.
The company said it expects 2003 earnings to be $1.20 to $1.40 per share, excluding the cumulative effect of new accounting standards of roughly $15 million, or 6 cents per share.
Monsanto will release first-quarter earnings on April 30.
On the Net:
Monsanto Co., www.monsanto.com
03/14/03 18:32 EST
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Justice Dept. probing Monsanto antitrust issues
ST. LOUIS, Mo., March 14 (Reuters) - Agrichemical producer Monsanto Co. said the government is investigating potential price fixing over the basic ingredient of the company's top-selling Roundup weed killer.
Monsanto shares fell more than 15 percent on Friday following the disclosure, which came in a securities filing late Thursday, even as the company affirmed its profit outlook for the year.
"When in doubt, get out," said R.T. Jones Capital analyst Juli Niemann, who said the news of the Justice Department investigation caught an already skittish investment community off guard.
Niemann said Monsanto's reaffirmation Friday of its 2003 earnings guidance was meant to reassure the market, but did little to soothe concerns.
"What they said in between the lines was 'we're ok, we're not reserving for this...' which gives nobody any consolation at all," she said.
Monsanto spokeswoman Lori Fisher confirmed Friday that the Department of Justice had initiated an inquiry about "possible anti-competitive conduct in the glyphosate industry," glyphosate being the basic weed-killing ingredient in Roundup.
Fisher said the government was seeking information from a number of companies that make and distribute glyphosate, the basic ingredient in Monsanto's top-selling Roundup herbicide. Last year, the company sold some 38 million gallons of the Roundup weedkiller.
Fisher said the company believes it has acted "appropriately" and was cooperating with the inquiry.
A Justice Department spokesman declined to comment on the matter.
Monsanto's patent on glyphosate expired three years ago and the company's sales have been coming under increasing pressure from competitive products and pricing.
Monsanto was named in a class action antitrust lawsuit filed in 2001 that alleges the company conspired with potential generic manufacturers to prevent them from going into the market producing Glyphosate, according to one of the lawyers who filed the case.
The case is pending before a U.S. District Court in Missouri, according to Elizabeth Cronise, a lawyer with the firm Cohen, Milstein, Hausfeld & Toll, PLLC.
The class action lawsuit also charges that, even before Monsanto's patent expired, starting in 1998 the company conspired to allocate market share for Glyphosate and another herbicide called Paraquat.
In the SEC filing, Monsanto said it has between five and 10 major global competitors for its agricultural herbicide products, and competition from local or regional companies "may also be significant."
The company said in the SEC filing that while no single customer represents more than 10 percent of its consolidated net sales, its three largest U.S. agricultural distributors and their affiliates represented, "in aggregate, 18 percent of our worldwide net sales in 2002, and 27 percent of our net sales in the United States."
One major U.S. distributor and its affiliates "represented approximately 10 percent of the net sales" in 2002 for Monsanto's agricultural productivity segment, which includes the glyphosate products, the company said in its SEC filing.
The Justice Department probe comes after a year in which the St. Louis-based company was rocked by market difficulties and upheaval in its top management.
Monsanto's revenue stream has been heavily dependent on its sales of Roundup herbicide and its other glyphosate family of products, but the company has said it is trying to reduce its reliance on that market because of competitive pressures.
The company saw revenues drop 14 percent in 2002 largely because of lower prices and reduced sales of Roundup.
In addressing the market concerns Friday, Monsanto reaffirmed its full-year EPS guidance to be in the range of $1.20 to $1.40. The company also reiterated expectations for free cash flow in 2003 of $350 million to $400 million.
Monsanto stock has lost about half its value in the last year as the company has been rocked by a variety of market forces.
The stock closed at $14.07, down 15.14 percent in trading on the New York Stock Exchange Friday.
Monsanto closed out 2002 with the unexpected resignation of President and Chief Executive Hendrik Verfaillie in December. The company is still searching for a new leader, leaving the business and investment communities with numerous questions about the company's future.
03/14/03 19:15 ET
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With kindest regards,
Barry Carter <[EMAIL PROTECTED]> 2319 Balm Baker City, Oregon 97814 Phone: 541-523-3357 Web Pages: Forest - http://www.subtleenergies.com/ormus/bmnfa/index.htm ORMUS - http://www.subtleenergies.com/ormus/whatisit.htm
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