The agreement represents an important next step towards the commercial introduction of INTACTA RR2 PRO™ soybeans in the country. It demonstrates strong support by the Agriculture and Livestock Confederation of Brazil (CNA), a leading national grower organization, as well as ten state agriculture federations in the soybean-production regions of Brazil. The agreement recognizes the important role of technology providers that invest in new technologies for farmers as well as for a value collection system that ensures technology providers are duly compensated for technology each time it is used on farm.
"Importantly, this agreement reflects the support of key grower associations and provides a mechanism to allow all parties to focus on the long-term solutions that will support the Brazilian agriculture industry and its growing demands," said Rodrigo Santos, Monsanto Brazil president.
Under the agreement, participating Brazilian farmers will secure a new license that will allow them to purchase soybeans containing the new INTACTA RR2 PRO™ technology, expected to be available in the 2013-2014 growing season. The agreement also underscores the grower associations' support for continuing a royalty collection approach, which ensures that growers pay royalties each time they use the technology.
The agreement also provides clarity on first-generation Roundup Ready soybeans for participating farmers. Those farmers will be released from payment of technology royalty fees for first-generation Roundup Ready soybeans for this and next season, while waiving all potential legal claims for payments previously made for this first-generation technology. Farmers who elect to not participate will continue to pay royalties on that technology through the term of Monsanto's intellectual property rights in Brazil that cover the first-generation Roundup Ready soybeans.
Monsanto had previously excluded the contribution related to the company's first-generation Roundup Ready soybean business in Brazil from its earnings per share (EPS) and free cash flow guidance, reflecting an estimated historical annual range of $0.20 to $0.25.
Monsanto and the leaders of these grower groups recognize that innovation in agriculture is one of the critical paths towards delivering value to Brazil's farmers and its economy and meeting the demands of our growing planet. The parties also agree and recognize the value that intellectual property rights and the associated royalties can play in stimulating new investments made by the agriculture industry.
About Monsanto Company
Monsanto Company is a leading global provider of technology-based solutions and agricultural products that improve farm productivity and food quality. Monsanto remains focused on enabling both small-holder and large-scale farmers to produce more from their land while conserving more of our world's natural resources such as water and energy. To learn more about our business and our commitments, please visit: www.monsanto.com. Follow our business on Twitter® at www.twitter.com/MonsantoCo, on the company blog, Beyond the Rows at www.monsantoblog.com, or subscribe to our News Release RSS Feed.
Certain statements contained in this release are "forward-looking statements," such as statements concerning the company's anticipated financial results, current and future product performance, regulatory approvals, business and financial plans and other non-historical facts. These statements are based on current expectations and currently available information. However, since these statements are based on factors that involve risks and uncertainties, the company's actual performance and results may differ materially from those described or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, among others: continued competition in seeds, traits and agricultural chemicals; the company's exposure to various contingencies, including those related to intellectual property protection, regulatory compliance and the speed with which approvals are received, and public acceptance of biotechnology products; the success of the company's research and development activities; the outcomes of major lawsuits and the previously-announced SEC investigation; developments related to foreign currencies and economies; successful operation of recent acquisitions; fluctuations in commodity prices; compliance with regulations affecting our manufacturing; the accuracy of the company's estimates related to distribution inventory levels; the company's ability to fund its short-term financing needs and to obtain payment for the products that it sells; the effect of weather conditions, natural disasters and accidents on the agriculture business or the company's facilities; and other risks and factors detailed in the company's most recent Form 10-K Report to the SEC. Undue reliance should not be placed on these forward-looking statements, which are current only as of the date of this release. The company disclaims any current intention or obligation to update any forward-looking statements or any of the factors that may affect actual results.
Kelli Powers (314) 694-4003
Lee Quarles (314) 694-2330