Few companies spin financial growth out of crop growth better than Monsanto. By making an early, successful R&D-heavy bet on biotechnology, Monsanto transformed itself from an agricultural-chemicals company in an increasingly commoditized sector into a cutting-edge seed-and-biotech firm. Because its rivals are still catching up to its prowess in creating biotech traits the software of seeds Monsanto has become the standard bearer and lightning rod for the controversial advance of genetically modified (GM) crops, sometimes derisively described as Frankenstein foods.
But it looks as if the monster has prevailed. The company's juggernaut is so impressive that the usually levelheaded market bible Barron's hyperbolically referred to "Monsanto's stranglehold on the planet's food chain." Some 740 million acres (300 million hectares) are planted with GM crops, about equally divided between North America and the rest of the world primarily Argentina and Brazil.
The difference is that Monsanto's home market uses virtually everything the firm has ever invented; elsewhere, its growth has been more restricted, a result of fewer regulatory approvals. But that's changing as more countries adopt biotech crops, first for fiber (cotton), then for feed (especially corn for animals) and then for food for human consumption. There are 25 countries collectively home to more than half the world's population that have planted commercialized biotech crops. Another 32 countries have approved biotech imports for either animal feed or food. The walls of even biotech's most ardent opponent, Europe, have been breached. In March the European Union approved a biotech potato, developed by the chemical company BASF for industrial use, which is the first GM planting approval since a moratorium was imposed some 12 years ago.
In fact, there are already 120 genetically modified plants approved or in the process of being approved in the E.U. (The moratorium has always been full of exceptions.) This is hardly broadcast by Europe's officialdom, whose scientists have no major disagreements with their colleagues in the U.S. over food safety. That silence certainly suits European firms that might otherwise be forced to compete more directly with Monsanto, Dow AgroSciences and Pioneer Hi-Bred International. "Neither the government nor companies seem to see much upside in being more candid with the public," suggests Brett Begemann, international executive vice president at Monsanto. "It's a difficult line to walk because when I talk to consumers in Europe, it comes across as 'Gotcha! You are eating it anyway.' There is a lot of work to be done to help people understand what's really going on."
Biotech is the most rapidly adopted crop technology in human history faster than the corn hybrids introduced in the U.S. in the 1930s and faster than the planting changes that took place during the Green Revolution. Advocates see biotech as a no-brainer, the only way to boost yields while escaping the trends of a growing world population (now 6.8 billion, heading beyond 9 billion by 2050) and finite cropland nourished by stressed water resources.