- Syngenta is a highly profitable multinational corporation with annual sales exceeding $14 billion.
- The crop protection market exceeds $63 billion, and seed sales exceed $40 billion worldwide. From 2012-2104, Syngenta enjoyed several billion dollars a year in corn seed sales. By marketing its genetically modified (GM) corn trait MIR 162 in 2013, Syngenta is alleged to have increased its revenues by $875 million.
- Syngenta reports that seeds generated a gross margin of 45%, with Viptera sales constituting more than 30% of Syngenta’s U.S. seed sales.
- Since China banned U.S. corn when it discovered Syngenta’s unapproved MIR 162 strain in U.S. corn exports, several large export partners have banned GM corn. While the rate of growth of sales of GM products has since slowed, GM sales still exceed $20 billion annually across the globe.
Syngenta’s market capitalization exceeds $32 billion. Syngenta’s sales exceed $14 billion per year, providing it with well over $1 billion a year in net operating capital. Syngenta reported “cash and cash equivalents on December 31, 2013 and 2012 of $902 million and $1,599 million, respectively. Syngenta 2013 Annual Review (“AR”).
In 2014, the market size of the crop protection market exceeded $63 billion. Of that, genetically modified (GM) and conventional seeds exceeded $40 billion. Syngenta Report, “First Quarter 2015 Sales,” April 17, 2015, p. 15.
In 2012, Syngenta’s corn and soybean sales increased by 25 percent. (2012 AR), with North American seed sales increase by 22 percent. Syngenta’s Annual Review (“AR”) reflected corn sales of $3.56 billion in 2013, (2013 AR, p. 21), $3.355 billion in 2014 (2014 AR, p. 20). Syngenta’s financial planning targeted $4 billion in corn sales by 2015 and $5.5 billion by 2020. (2013 AR, p. 21).
Archer Daniels Midland Company’s lawsuit alleges that “Sygnenta’s revenue from the sale of MIR 162 seed was approximately $875 million in 2013 alone.” Petition for Damages in Archer Daniels Midland Company v. Syngenta Corp., Syngenta Seeds, Inc., and Syngenta Crop Protection, LLC, No. 79219, In the 29th Judicial District Court for the Parish of St. Charles, State of Louisiana, filed November 19, 2014, ¶14.
On a February 4, 2015 earnings call, Syngenta C.E.O. Michael Mack stated that,
the seeds business generated 45% gross margin in 2014 and we have a number of initiatives underway that will substantially improve the margin of the seeds business by 2018. As distinguished corn in North America from corn in rest of the world, the higher North American margins reflect the commercialization of our proprietary corn traits in the U.S. … Meanwhile, demand continues to grow steadily at around 1.5% per annum, most notably in the emerging markets, which continue to be the major growth driver for our industry.
Syngenta reports that “sales of the Agrisure Viptera corn trait, where Chinese import approval was achieved at year end, remained steady at around 30 percent of the U.S. corn seed sales.” 2014 Financial Report, p. 11. Syngenta reported that in the first quarter of 2015, Agrisure Viptera remained “>30% [of the corn & soybean] portfolio.” Syngenta “First Quarter 2015 Sales” report, April 17, 2015.
However, since China banned U.S. corn once traces of unapproved genetically modified corn were detected, sales of corn have plummeted in dollar value. Furthermore, China has barred nearly 1.45 tons of corn shipments since 2013. In early April 2014, Russia announced it would stop importing GMO food products. NSNBC International, Russia Bans Import and Production of GMO Food, Tightens Non-Food GMO Restrictions, April 6, 2014. Mexico also has implemented a total ban on all GMO corn after a Mexican judge ruled that GMO corn was an immediate hazard for the health of Mexican consumers. NSNBC International, Mexico and Hawaii Ban GMO as People Worldwide March Against Monsanto, April 12, 2014.
While the pace of growth of GM seeds has slowed since China’s rejection of MIR 162, GM seeds still collectively achieved over $20 billion in sales worldwide. Syngenta Report, “First Quarter 2015 Sales,” April 17, 2015, p. 15.
* This information is provided to supply relevant information concerning the GMO corn lawsuit, and should not be received as legal advice. Legal advice is only given to persons or entities with whom Watts Guerra LLP has established an attorney-client relationship. If you have another lawyer in the GMO Corn lawsuit, you should consult with your own attorney, and rely upon his or her advice, rather than the information contained herein.