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May 28, 2010

Monsanto Restructures RoundUp Prices Due to Competition

On 28 May 2010 the Wall Street Journal reported on Monsanto's efforts to restructure its RoundUp herbicide business. In an effort to compete with generic versions of RoundUp (glysphosate), the company was slashing pricing within range of the generic competition.

Since the 1990s, RoundUp has provided sizable profits for Monsanto.  The move to cut prices represents an end of an era for the company.  According to Hugh Grant, Monsanto's Chairman and Chief Executive, Roundup business has "officially graduate[d] to the background of our earnings profile."

Monsanto's RoundUp patent expired in 2000.  China has become the leading producer of this herbicide, with "the capacity to make twice as much of the herbicide as the world needs."  According to Monsanto's Chairman and CEO, "antidumping actions might be needed to preserve the industry in the U.S., Argentina and Brazil."

When Monsanto's RoundUp patent expired ten years ago, the U.S. farmer paid an average of $14 to $16 a gallon.  Today it is selling in the $10 to $12 range and expected to drop to between $8 and $10 a gallon.

For more see: Kilman, Scott and Ian Berry. "Monsanto Cuts Roundup Prices as Knockoffs Flood Farm Belt," Wall Street Journal, 28 May 2010.

About Margaret

CEO and Curator (The Food Museum) | Managing Director and Chief Editor (GR2 Global LLC) | Educator (UCLA PhD) | Researching and writing on global food issues, nutrition and health, sustainability, history (preservation), conservation (natural resources), and design.
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