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FMC's reborn ag chemical agenda has new Aussie herbicide in spotlight
Apr. 6, 2020
FMC Corporation
United StatesFollow
United StatesBy Andrew Marshall
In the wash-up after the high profile chemical company mega-mergers of 2018, Australia finds itself in the spotlight as one of the industry's quieter business rebirthing manoeuvres gains momentum.
The US-based FMC brand is about to unveil a blockbuster farm chemical developed from new chemistry picked up after the DuPont-Dow Chemical merger.
FMC, which traditionally was something of a lower profile, generic-heavy brand in the local agricultural chemical market, has chosen Australia to launch and manufacture its new mode of action pre-emergent herbicide, Overwatch.
The product, which is poised for final approval from the Australian Pesticides and Veterinary Medicines Authority, promises new chemistry which will be particularly effective against ryegrass in cereal and canola crops.
Although FMC's origins date back 130 years to a farm spray pump inventor in California whose company grew into a multinational chemical, food and industrial technology conglomerate, the brand returned to its agricultural roots in 2018.
It spun off various other big business interests to relaunch as a pure-play crop protection company - the fifth biggest in the game, and with no seed, livestock or industrial chemical industry distractions.
Relaunched ag agenda
Its newly reinvigorated crop chemical focus was largely made possible by the 2015 takeover of Danish company Cheminova, then the $US1.2 billion purchase of DuPont's insecticide and cereal and broadleaf herbicide businesses and much of its crop protection research and development capabilities in late 2017.
The deal let DuPont placate European competition regulators' fears about too much agricultural research being concentrated in its new super-sized Dow-DuPont company, and boosted FMC's estimated annual crop sector revenue to almost $US4b.
"It also became acknowledged as one of the best value acquisitions during that mega-merger period," said FMC's Australasian leader, Kristina Hermanson.
Other giants amalgamating at the time included Syngenta and ChemChina, and Bayer and Monsanto, while BASF and Nufarm each picked up brands and businesses offloaded by the other players.
Ms Hermanson, who joined FMC in 2018 just as it was divesting a lithium, lubricants and polymer manufacturing portfolio to focus on agribusiness, has subsequently overseen a multimillion dollar upgrade of its Australian chemical plant.
The NSW Central Coast site already produces most of FMC's locally-registered labels such as herbicides Rustler and Hammer, and Impact fungicide.
In January a formulation line was commissioned to accommodate the commercial release of Overwatch for the 2021 cropping season.
"The Overwatch launch will allow us to prove ourselves as a tier one player in this space," Ms Hermanson said.
Agile, local capabilities
Although much smaller than its big name farm inputs rivals, FMC was agile and had the advantage of significant research capacity funded by 7pc of global revenue.
Local production capacity gave FMC supply continuity and the ability to respond quickly to fluctuations in product demand when Australia's diverse climatic conditions created different customer pressures around the country.
She said knowing the Wyong site was working extra shifts to meet orders at present was particularly reassuring given the uncertainty and disruption prevailing across many global supply chains of late.
"The plant is running harder than it has been for years," said Ms Hermanson.
"Given few multinational companies actually have integrated formulation and packaging facilities in Australia, it's an operation we're proud of, which also reflects our commitment to the market."
She is relishing the prospect of a 20pc increase in Australia's winter sowing area and much-needed revenue revival for many NSW and Queensland croppers and service providers.
Although once a big player in the off patent herbicide market, about a third of FMC brands were now patented products developed by its various overseas R&D facilities, including insecticide Rynaxypyr, the world's second most popular crop chemical after broad spectrum herbicide glyphosate.
"In the past five years we've been moving away from generic products in favour of adding more value to what we do," she said.
"We don't even have a glyphosate line in our portfolio these days - plenty of other manufacturers can do glyphosate."
FMC had also built a strong team of technical and extension specialists within its 100-strong Australia-New Zealand workforce, including new recruits on the ground to help "bring the chemistry to life" in farm trials and demonstration events.
"We worked with at least 3000 agronomists and consultants through various demonstration opportunities last year and they'll be the focus of larger scale trials for Overwatch around Australia this season before its commercial release," she said.
At the helm
Raised on a Wisconsin dairy farm where her family still live, Ms Hermanson initially arrived in Australia eight years ago expecting to join east coast grain logistics, marketing and processing kingpin, GrainCorp.
She had a business development and integration role with US giant Archer Daniels Midland which launched a surprise takeover bid in late 2012 and spent a year trying to nail down the deal before it was eventually scuttled when the federal government deemed ADM's motives against the national interest.
Having previously worked for a decade in Europe running a $US2b ADM oilseed processing division, she was "ready for a personal and professional change" and opted to stay.
That decision later led to marriage and settling into family life here with a baby daughter and two stepchildren.
"I found the Australian culture welcoming and warm. I even made good friendships with some of the team at GrainCorp," Ms Hermanson said.
Although an engineer by training, her strong rapport with farming and what makes agriculture tick have driven her to actively focus on community and inclusion in the company and the wider ag sector.
Diverse advantages
FMC has adopted strategies to promote diversity, including ensuring there is always a gender mix when final round decisions are made on job applications, and staff are urged to feel included and speak up on how the business could best operate.
"I'm very conscious Australian agriculture has just 2.3pc female CEOs and that we must do more than just talk about diversity or opportunity," she said.
"I was very fortunate to be recruited into this role and really have received so much opportunity.
"I take that responsibility very seriously and try to be a role model."
Inclusion and workplace diversity meant much more than encouraging women to step up to more prominent jobs in agriculture.
She felt it very healthy for both women and men to take parental breaks to spend time at home with their children, or to have men in teams traditionally filled by women, such as customer service.
Agriculture in Australia was a "tight team environment".
Fresh role models at every level would be critical to helping our small farm sector workforce achieve more diverse and innovative ways to tackle agriculture's challenges and make the most of its opportunities.
Source: farmonline
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