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Cheaper weedkillers force Monsanto to cut prices

Cheaper weedkillers force Monsanto to cut prices

Monsanto Co. has been forced to cut prices on its Roundup weedkiller due to intensifying competition from generics and company shares slumped to a three-year low on more modest profit expectations.
Monsanto said lowering its prices will cut earnings per share by 50 to 70 cents this year, sending shares down 8 percent in active trading. Annual earnings are now projected to be between $2.15 and $2.41. Earnings for the third quarter are expected to range between 65 and 72 cents a share.
Competition in the industry, largely from China, has become clear in recent months.
In April, Monsanto reported that its second-quarter profit fell 19 percent to $887 million.
Chinese companies flooded the market with cheap varieties of weedkiller and CEO Hugh Grant said farmers are unwilling to pay premium prices for the Monsanto's new lines of biotech seeds. Some of those seeds are twice as expensive as the varieties most farmers grow today.
"By reducing the uncertainty associated with Roundup, we free Monsanto to grow on its fundamentals," Grant said. "What matters to our long-term growth is our seeds-and-traits business, which is on track."
Shares in Monsanto Co. fell $4 to $48.66.


Updated : 2021-05-11 16:49 GMT+08:00