Management Report
9.2 CropScience
Research and Development
In the first nine months of 2011 we invested €521 million in research and development at CropScience, including €177 million in the third quarter.
The active ingredient pipeline of Crop Protection currently comprises nine developmental projects, seven of which are at an advanced stage and two at an early stage of development. About 35 more projects are in the research phase.
In addition, we expect to bring some 20 new projects to market-readiness for the large-area crops of cotton, canola, rice and soybeans alone by 2015.
We achieved significant progress with our innovation and growth projects in the first nine months of 2011.
At the start of the current season, we launched cotton seed with our proprietary glyphosate tolerance trait on the U.S. market.
The spring of 2011 also saw the successful market introduction of new crop protection products. For example, we successfully launched the Xpro™ family of fungicides – effective against a broad spectrum of fungal diseases in cereals – in Germany and the United Kingdom, two of Europe’s major wheat-growing countries. Our new seed treatment Poncho™/Votivo™ was used in corn for the first time in the United States. This addition to our conventional portfolio is effective against nematodes – threadworms that live in the soil.
In April 2011, we received marketing authorization for the herbicide Alion™ from the U.S. Environmental Protection Agency. Alion™ controls a broad spectrum of weeds and is primarily used in perennial crops such as citrus, tree nuts, grapes, and pome and stone fruit.
In July 2011, the United Kingdom became the first country to register the new fungicidal seed treatment Emesto™. This product has outstanding efficacy against black scurf (Rhizoctonia solani), significantly enhances potato quality and increases the marketable yield.
In September 2011 we acquired exclusive license rights to the rice breeding program of the Brazilian company Fazenda Ana Paula, which specializes in the breeding of hybrid rice.
To drive growth based on new products, we intend to double the annual research and development spend in the BioScience business group by 2015 (2010: approx. €200 million). The annual R&D budget of CropScience as a whole is planned to increase by about 20% over the same period to more than €850 million.
Capital expenditures, acquisitions and cooperations
In April 2011, we acquired U.S.-based Hornbeck Seed Company, Inc., which supplies soybean, rice and wheat varieties and has an in-house soybean breeding program.
In April 2011, we signed a global license agreement with the U.S. company DuPont concerning a herbicide tolerance trait for canola.
In June 2011, we signed a license and cooperation agreement with RAGT Semences S.A.S., France, under which RAGT grants us access to winter wheat germplasm and associated molecular markers.
In October 2011 we successfully completed the acquisition of the oilseed rape business of Raps GbR, headquartered in Germany. This business mainly includes varieties that are already on the market and the company’s breeding material.
Emerging markets
In the emerging markets, CropScience grew sales by 12.7% (Fx adj.) in the first nine months of 2011 to €2,221 million, including third-quarter sales of €762 million (Fx adj. +14.9%). We registered the strongest absolute growth in the third quarter of 2011 in Latin America, especially Brazil and Argentina, at the start of the planting season there. The most significant growth markets in Asia were India, China and Thailand. The growth region of Africa/Middle East also developed well, while Eastern Europe posted the highest percentage increase. The emerging markets’ share of total CropScience sales was 39.8% in the first nine months, and 55.2% in the third quarter due to seasonal factors.