WASHINGTON, Sept. 22, 2014 --While some agricultural companies are paring back their investments as commodity prices drop, at least one international player plans to increase spending.
Bayer CropScience plans to invest close to $900 million in the U.S. in the 2013-2016 period because of the long-term growth opportunities in a region it considers a vital part of its global growth plan, CEO Liam Condon said last week.“We only do this because we’re convinced the markets are going to continue to grow, because the demand is going to continue to grow,” Condon said during a press conference at company headquarters in Monheim, Germany. “We are convinced of the long-term growth potential of the agricultural markets despite increasing volatility.”
Condon, who’s been running the company since December 2012, said he expects the worldwide market for agricultural inputs of crop protection products, seeds and traits to double to around 100 billion euros ($1.28 billion) by 2020, from 50 billion euros in 2008.
The expected growth is the result of several factors, including the increasing global population, diet changes and the need to reduce agriculture’s impact on the land. “[Agriculture] is crying out for innovation and more intensification in a more sustainable and also a more productive way,” he said.
The company committed to an investment program in 2013 that will see global capital expenditures of 2.4 billion euros through 2016.
The largest individual investments are planned for the company’s Dormagen, Frankfurt and Knapsack sites in Germany, and in Mobile, Alabama, and Kansas City, Missouri, in the US.
Along with capacity expansions at Bayer’s Muskegon, Michigan and Kansas City, Missouri sites, the company constructed a new plant in Mobile, Alabama for the production of the Liberty herbicide.
In June 2014, the company announced plans to expand its North American and global Seeds headquarters in Research Triangle Park (RTP), North Carolina. Approximately $200 million will be invested through 2016 at the RTP site.
Condon also said there is a need to improve communication with the public about modern farming and the role farmers play in protecting the environment with sustainable practices. A societal debate on the future of farming and role of modern agriculture in society will continue and put increasing importance on sustainability, he said.
“We need to do much more in generating awareness of how important farming is for our future,” Condon said.
Bayer is launching a project called “Forward Farms” to show “real farms that combine the most modern farming practices, in a way that the farmer can make money and have no negative impact on the environment…because these are often seen as a contradiction.”
Also, a new online discussion platform called “Farming’s Future Dialogues” will include topics such as “Modern agriculture – A threat to the honey bee?” and “Responsible farming and economic success – contradiction or winning combination?”
The platform is open for anyone to comment or pose questions to Bayer. “If you want to hear evidence-based scientific opinion you can contact us,” Condon said.
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