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Business Briefs - Nov. 19, 2008

Market Choices suspended by seed industry

ALEXANDRIA, Va. — ASTA announced on Oct. 20 the suspension of the grain marketing program and certification mark, Market Choices, which will be phased out by the fall of 2009. This decision comes as the trade of U.S. corn, corn gluten feed and distillers dried grains and solubles (DDGS) with the European Union (EU) has essentially stopped due to the lack of timely regulatory approvals for corn biotech traits.

Although the U.S. has seen continued rapid development and adoption of these traits over the last 13 years, the regulatory approvals for grain and other feed products derived from this technology to enter the EU has lagged significantly behind U.S. and global approvals. A zero tolerance for traits not fully approved in the EU has made importation of U.S. corn and derived products virtually impossible since 2007.

Representatives of the European agricultural industry have requested the European Commission (EC) allow a tolerance for biotechnology traits not yet approved in Europe but approved in the country of origin. The Commission and EU member states failed to agree on the adoption of a tolerance at the most recent meeting of the Standing Committee on the Food Chain and Animal Health at the end of September.

“Discussions have been held in the EU seeking an allowable tolerance for biotech traits approved in the U.S. but not in the EU to facilitate trade, but there is no indication that such a tolerance, if granted, would be at a commercially viable level for exports to continue from the United States,” commented ASTA President and CEO Andy LaVigne.

“Most importantly, the EU regulatory system continues to be unpredictable with respect to the review and approval of biotechnology products, which negatively impacts Europe’s feed and livestock industries, growers, and ultimately consumers.”

LaVigne noted that if the EC should provide for a commercially viable tolerance or demonstrate a functioning regulatory system for the approval of biotech events, ASTA would evaluate reestablishing the use of the Market Choices certification mark and the related program with any appropriate adjustments needed to make the program effective.

CNH Capital cuts 115 jobs

RACINE, Wis. (AP) — A CNH Capital spokesman said the company has eliminated 115 employees with the majority of the job cuts coming in Racine.

Case-New Holland spokesman Tom Witom declined to be specific about how many employees were let go in Racine compared to its Canadian operation in Saskatoon, Saskatchewan. But employees say that at least 100 people in Racine were cut since Nov. 7.

CNH Capital is the financing arm of CNH Global, a manufacturer of farm and construction equipment. Before the job terminations, CNH Capital had approximately 300 employees at its headquarters in Racine. Witom called the cuts an adjustment, not a restructuring, during the economic downturn and says the company remains a “viable enterprise.”

CNH Global is based in Burr Ridge, Ill., and majority-owned by Italian carmaker Fiat.

New ethanol plant for northern Illinois
OREGON, Ill. (AP) — Another plant expected to turn 18 million bushels of corn a year into 50 million gallons of ethanol is headed to northern Illinois.

Illinois River Energy LLC plans to build the $120 million plant in Ogle County, next to an identically sized one the firm already has there. The project will get a state renewable-fuels grant worth $4 million.

Gov. Rod Blagojevich said the new plant will create 40 jobs. Construction is expected to be complete by September of next year.

NSF funds research on sustainable biofuel
CHAMPAIGN, Ill. — The National Science Foundation (NSF) announced it is funding a new research effort at the University of Illinois aimed at understanding how – and whether it is possible – to build sustainable infrastructure to support the emerging biofuel industry.

The $2 million grant is one of six NSF awards this year to institutions engaged in engineering infrastructure research. The Illinois team will tackle the engineering, social, environmental and economic constraints of developing and maintaining critical engineering infrastructure so as to sustainably support the emerging bio-economy.

The interdisciplinary nature of the effort is reflected in the breadth of expertise of its researchers: civil and environmental engineering professors Ximing Cai (project leader), Yanfeng Ouyang, Imad Al-Qadi and Murugesu Sivapalan (also in geography); agricultural and biological engineering professor Steven Eckhoff; atmospheric sciences professor Atul Jain; agricultural and consumer economics professor Madhu Khanna; natural resources and environmental science professor Gregory McIsaac; and sociology professor Stephen Gasteyer (formerly at Illinois and now at Michigan State University).

The university also is one of three U.S. institutions selected last year to be part of a $500 million, BP-funded Energy Biosciences Institute, one of the largest biofuel research initiatives in the U.S.

Dow acquiring Südwestsaat GbR, Brodbeck
INDIANAPOLIS, Ind. — Dow AgroSciences LLC announced it is acquiring the assets of Südwestsaat GbR (SWS), a hybrid maize company with its headquarters near Rastatt, Baden-Württemberg, in Germany, and the assets of Brodbeck Seed Inc. of Wabash, Ind.

SWS was founded in 1997 based on the breeding activities of the three shareholders whose maize breeding activity traces back to 1912. The three shareholders are Dr. Hans Rolf Späth GmbH & Co. KG., Fr. Strube Saatzucht GmbH & Co.KG and Nordsaat Saatzucht GmbH, who are all members of SAATEN-UNION GmbH.
The closing is expected in the coming weeks. Financial terms of the agreements will not be disclosed.

SWS focuses on breeding, development, registration and production of high performing maize hybrids for Europe with sites in France, Hungary, Portugal and Germany.

Under the terms of the agreement, Dow AgroSciences would acquire the assets of SWS to include all these activities. The addition of SWS will build upon Dow AgroSciences’ current seeds growth initiative for Europe joining the 2007 acquisitions of MTI and Duo Maize.

Under the terms of the agreement with Brodbeck, Dow will acquire all sales, marketing and agronomy assets and the product development program and associated assets.

Stan Leland, president of Brodbeck, will remain with the business to lead Brodbeck. Doug Rice will serve as the financial and marketing manager, and Mike Coomer will continue to lead the research and development activities.

Current Brodbeck-owned production and distribution assets will be operated by Advanced Ag Resources, Inc. and Accelerated Ag Distribution, LLC, respectively. Both companies will be led by Robert Hettmansperger. Dow will continue to independently market Brodbeck Seeds under the Brodbeck brand, and the company headquarters will remain in Indiana.

Additionally, Dow announced it created 350 new positions globally in 2008 to forward the company’s research and development work and to produce and commercialize its new products. More than half of the jobs were added at the global headquarters in Indianapolis, according to the company, and it is expanding its workforce through employees added via acquisition, with six other seed companies being acquired in the last year.

11/19/2008