(Editor's Note: These questions and answers are excerpts, taken from an Open Mic audio interview with Jim Collins. To listen to the full podcast, click here.)
1. Mergers and consolidation have been the trend and global agriculture over the past several years. Jim Collins, CEO of Corteva Agriscience, says their new company has a very rich history. Explain how you got to where you are today.
The story of Corteva really started about five years ago. Two iconic companies, the Dow Corporation and the DuPont Corporation, announced their intent to merge and work through a couple of years. And then by August of 2017, we received regulatory approval all around the world. So, we merged those two companies together, and then almost immediately began planning for the divorce if you will, breaking them back apart. We were able to look across those two entities and then pull together the really important pieces to create three brand new companies and one of those was to create Corteva. We took all the best pieces and parts of agriculture at Dow and DuPont and brought them together. In June of 2019, we launched Corteva in the marketplace. And you know, on that day, we were really kind of the only remaining US-based pure play, seed, crop protection and digital player now with all the other consolidations that you talked about going on in the industry. And we emerged stronger, much more balanced than the predecessor companies, and more competitive going forward. It was an opportunity to offer more choices for our customers. We’ve got 20,000 employees, we’re on the ground in over 140 countries around the world. And that's supported by a fantastic intellectual property patent estate, a set of R & D facilities that are characterizing products for our customers every day. So, while we've got 300 years of history from our parents, we really are a startup. I joke a lot when asked the question: Can you describe Corteva? I say, Yep, we're a 300 year old startup, great team, great heritage, but some really exciting things looking forward.
2. You have a career serving in agriculture and serving this industry. And you were invited by the White House to discuss economic recovery back in April. What are the things that you offered, during your time at the White House?
It was a really special time, but at the early part of this whole crisis, as it was unfolding, the White House did reach out as part of their economic recovery efforts to kind of get our views on what the US administration could do to better support our farmers all across the country. I stressed a couple of things. First, that it was critical to keep U.S. agriculture labeled as essential. We were in the heat of our key deliveries all across the Midwest and wanting to make sure that there were no disruptions in the supply of seed to our customers. We asked the administration to make sure that as they looked at the small business loans process that those a section of those loans were walled off specifically for farmers as we were kind of at the heat of the season and farmers were real busy focused on getting the crop in the ground. They would likely miss some windows and they did that. Clearly the MFP payments were important to see those continue. And I think one area that I really stressed is we saw some big supply chain disruptions, especially the dairy industry where producers lost access to some of those critical markets. And so, USDA went looking for ways to really connect a grower directly to a food bank, for example. The food box program has just been outstanding. I do continue to have great conversations with Secretary Perdue and other members of the Department of Agriculture and I'm excited that what the administration has done to make sure our customers are staying viable throughout all of this.
3. How has this COVID pandemic forced this industry to adapt? And are there changes that have been made that probably won't go back to what we knew before is normal.
The first thing you can say is clearly the pandemic has added a new layer of stress, the ag industry is already a pretty stressful industry, and so that new layer has created challenges. But in all of those challenges, we see opportunities, as well. First, it's big supply chains. And I think it's forced us to be very nimble and quickly pivot to make sure either key crop protection products are multi-sourced, from different geographies around the world, and finding ways to be creative with how we interact with our customers. Agriculture has typically been a real face to face type of industry in the past, and we're using a lot more digital tools now to reach out, connect with growers and make sure they have the products and the information they need as they were making decisions at a really, really critical time. I think that's probably the aspect of our business that won't go back to the way it was. We will find ways to be more digital in our interactions, to supplement what is already one of the I think iconic go to market models in the industry.
4. What role do you see technology playing in our future of meeting food, fiber and fuel needs?
One of the theses of this merger was how could we do more with the precious research dollars that we spend - having a bigger footprint and being able to leverage that. And since we've launched our company, we've launched 14, innovative new game changing products out there in the marketplace. Speed is going to be important here, if we if we're able to keep up with the nine to 10 billion people coming in 2050. That gives us about 30 chances left to get it right. And one way to really bend that curve is innovation. We’ve got a great pipeline coming in, I think growers are really appreciating that.
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5. We've seen consumer push back - not just on new technologies, but on chemistries that farmers have used for years. On one hand Corteva mounted a court battle to try to defend the use of dicamba with the new genetics that are available, but on the other hand, also decided to stop producing chlorpyrifos. What criteria do you use in making these sorts of decisions?Well, first, the company is continuously investing in R & D. And that R & D is looking forward, right. We're listening to consumers; their desires and we're working with regulators to understand their issues and concerns. So we can bring new products to solve those. In the case of chlorpyrifos, this is a good example of where it was both. It was purely a business decision. This is a 40-year old product that has been kind of generically challenged. The margins and our opportunity to make a profit on that had dwindled long ago. So, we were sort of supplying the product in the market at almost essentially zero earnings. Now in our pipeline, we have products to replace the uses that chlorpyrifos went into. So, we're able to do that at a better value and a better opportunity for our growers. While we made a business decision, we decided to produce for this full season this year so growers would have a way to transition through this season into next year. And then there will still be other suppliers which means, we're still going to work with EPA to defend the science and label behind chlorpyrifos. So, our decision to exit was a business decision purely based on the fact that we had newer, better products coming that could do the same task.
6. Are there particular new technologies, whether biological, so others that can replace some of these chemistries that producers are, are certainly in need of to protect their crops? How does a state like California that seems to operate by more stringent rules - a challenge for your company?
Clearly, there, there are opportunities in these markets. As a science and innovation based company, we view these standards as challenges. How do we invent and develop products that can live to those highest standards? One of the things I've always been excited about Corteva is that we don't have different standards for different markets. We find the highest the toughest, the most stringent, and we design all of our new products to exist in those markets. We already have a few products that meet those stringent criteria. One of those is, is our spinosyns chemistry - Spinosad and spinetoram - both of those have been awarded US EPA, green chemistry challenges and awards over the years. And they already incorporate the principles of green chemistry right into their right into their design. And then you're right, we're working on a set of biological solutions as well, where, markets will more appropriately require the types of solutions. And then I think, as we design, the next generation of herbicides, insecticides and fungicides, designing them purely with, with sustainability and these environmental standards in mind. One product that we just launched in in Europe in the cereals market and another that we launched in the US and the rice market, both went through the regulatory process in record time, because of their safety profile. So, standards are tough, they're high, but we view those as challenges and real opportunities for us to meet those standards.
7. Does consumer opinion ever outweigh what the science actually suggests?
I think it’s partly education, right? Part of the role that industry has is to make sure that we're sharing in a very transparent, very open way, the knowledge and the information that we have to go with the science. Sometimes the words that are used matter, and the way we approach different audiences matter, and the way we engage really matters. One of the things I'm proudest of is when we built Corteva during those early days, we talked about our purpose statement. And the purpose statement clearly starts with producers. It is about meeting the needs of our farmer customers, to do what they do best, to be more productive, and to help them be more profitable. But it also has to have an ear towards consumer demands and consumers desires. And then we can play that really important role of translating what a consumer asks for into a tool that can be put in the hands of a grower. And I think that's something what we're seeing right now, in the areas of climate and sustainability, consumers want a more a more sustainable production system. And what we see is the fact that agriculture can actually play this massive role and be part of the solution to some of these issues. So, whether you call it climate positive ag or regenerative ag, I'm really excited about the role that the farmer can play to not only meet those consumers demands, but actually help go out there and solve some of these issues. Farmers are the one of the greatest stewards of land already. And now with some new tools, we can take that to another level.
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