Replies to post #72 on Monument Circle Acquisition Corp (MON)

[Democritus_of_Abdera]

Re: “What year does this refer to?”...

In a low stress year [which year does this refer to?], reduced refuge and improved pest control with Genuity™ SmartStax delivered a 6.3 bushel per acre advantage over competitor triple stacks.

Dew, as you pointed out (#msg-44482312), the PR relating to Rob Fraley and Ted Crosbie’s presentation at the American Seed Trade Association Research Conference failed to specify that 2009 was the low stress year with respect to root worm insect pressure; hence, the triple stacks, which provide root worm protection traits in addition to the corn borer and roundup ready traits of double stacks, did not generate the yield advantage for corn that would have been seen if the double stacks had been decimated by root worm. .... However, it was a high stress year with respect to white mold pressure on soybean yields. No commercial seed guards against white mold, so the high pressure was not relevant with regard to yield comparisons...

In any event, I’ve come to realize that yield comparisons based upon company data such as provided in this PR are misleading and of limited value to the investor. Both Pioneer and Monsanto cherry pick their data set to present the best comparisons... I’m looking for a more reliable metric and am considering market share or acreage planted as surrogates.

Quotes from the American Seed presentation that are relevant to your question regarding “a low stress year”:

<Rob Fraley... talking about corn in his prepared remarks>: Now the last slide I’m going to use is kind of a set-up for Ted’s talk. I’m going to use this to put a couple of things in perspective. It’s a bit of a complicated slide and I’m using this to put the performance for this year in context. And I’m doing this in the sense of -- not what you think. We’re not at all using weather as an excuse for this year’s performance. In fact, what I want you to think about is just the contrast, that in what has now turned out to be probably the wettest year in the last decade, and the year with the least insect and bug pressure in the last decade, our genetics and our traits have performed very, very well. And I think when you put it in perspective with a cool, wet summer with a lot of disease pressure both in corn and soybean that maybe took the edge of some of the products, particularly in the case of white mold in soybean, I think our products have done exceptionally well and we’ll show you those yield results. And I think the bottom line is in this year to see the performance of our products and how impressive they were, both from the genetic side and from the traits, from the performance of SmartStax in a low bug pressure year, the performance of Roundup Ready 2 Yield, I think we’re very pleased.

In the Q&A:

<Q>: Yes, hi. Philippa Cook from JPMorgan. So, it seems that during the 2009 growing season there may have been like a shift to maybe more double stacks being used versus triple stacks. And on Slide Six, you lay out some the corn insect pressures and how maybe the pressure on corn rootworm has been reduced during the 2009 growing season. And so I have a couple of questions around that. So first, has any of the reduction in insect pressure from rootworm led to shift in doubles? And are there current trends for corn rootworm and they that in any way influence the rollout of SmartStax? And I guess lastly, are there any yield comparisons for VT triples versus let say a Pioneer double?

<A – Robert Fraley>: Great questions and I’ll give just a couple answers and I’ll let Ted focus on that last part. So in general we’ve not seen a shift from triples to doubles. The overall volume of triples increased what, 33 million acres this year. So the volume of triples has increased. One of our competitors had more doubles then triples and pushed doubles. But from our perspective, when you take a look at the increasing spectrum of insect damage across the corn-production areas, the areas affected with a variety of caterpillars or rootworm is increasing. And in a typical year the risk management of that acre would be better served by a triple stack in those production areas So I don’t see us shifting significantly to doubles. I think the triples in SmartStax year in, year out will provide the highest field and the best risk management for the bulk of the growers in the corn belt and that’s certainly the feedback we’re seeing. And then if you add to that the advantage that they provide ultimately in terms of 5% refuge or ultimately refuge in a bag, those are other compelling economics that I think move us down the technology curve. And as long as we’re delivering the values in the range that Ted showed for the economic benefits, I think it’s an easy decision for most growers. Ted, do you want to comment on the triples versus doubles?
<A – Theodore Crosbie>: Sure. We just compare singles versus singles, double for doubles, triples for triples, because that is the true germplasm comparison. And there are two reasons for doing that. One is that we have determined that our triples yield better than doubles. And the second thing is that there’s data from Iowa State that shows that the larger root system on our triples actually takes up more nutrients, specifically potassium, and so you really want a healthier root system and better nutrient uptake to maximize your yield. Now in some wet seasons, early wet springs, there’s a decrease in the rootworm pressure and that’s been the case in the last two years, particularly this year. Essentially the moisture drowns the rootworm, so there’s less rootworm pressure. But that’s an abnormality when you look at a 10-year window. And so there hasn’t been any reduction in rootworm pressure other than the in-season year like ‘09 which is low, but that doesn’t mean rootworms have gone away. As soon as we get back to more normal weather you will see rootworm pressure come up like we’ve tried to portray it and did see it in ‘06 and other years. So we really believe that triples versus triples are the only really fair comparison and we don’t want to mix up trait conversion issues with that.
<A – Robert Fraley>: Just to make it slightly more complicated, even when our competitor’s positioning doubles versus triples, they’re also applying a rootworm insecticide, so it’s not quite that simple a comparison. Thanks. Bye, bye.

......

<Q>: [Neeraj Chandra from Tiger Global in a question series related to variance associated with yield data].... I just wanted to follow up on the – if there is a site-specific nature of any of this?

<A – Robert Fraley>: I think we’ve talked about it. We talked about it certainly in North Carolina where we had a bit of site-specific issue with the rapid growth of the Roundup Ready Yield beans and the quick canopy and in areas where there was cool and moisture in soybeans there was a lot of disease pressure, a lot of white mold. So there’s certainly geographies in Nebraska and other areas where in many ways the fastest-growing bean was probably more penalized than a slower-growing bean because as you form that canopy you prevent the sunlight from getting into the row. If you got a lot of moisture and cool weather then that becomes an incubator for sclerotinia, white mold, and we certainly experience that in some of the geographies. I think if you take out of the equation it would look very good across all of the soybean production areas. All right, sure.