Dow constantly launches innovation solutions to double sales

Dow AgroSciences expects double digit growth in sales in the next 5-7 years. To drive margin expansion, an strategic overview of how to launch and accelerate new technologies was addressed by Antonio Galindez, president and CEO of Dow AgroSciences, at the Bank of America Merrill Lynch Global Agriculture Conference in Feb 2014.

In 2013, the total sales of Dow grew by 12%, with seeds sales up by 19% and crop protection up by 10%, while the respective sales growth rates in the global agriculture market were 8%, 7% and 9%. Between 2007 and 2012, Dow showed the compound annual growth rate (CAGR) of total sales  up by 11%, seeds sales 30% and crop protection 8%. Due to a decade of innovation investment, Mr. Galindez pointed that the company now holds a world-class seed business and best-in-class products pipelines.

To outperform the market continually, the company persists their investment aligned closely to attractive market that requires different technology. Therefore, three waves of innovation have been launched respectively in crop protection products and seeds products. The incremental sales revenue of crop protection products is expected to reach over $1 billion in 2015, with growth CAGR over 25% since 2008.

Sulfoxaflor (trade-marked as Isoclast^TM) is the sole member of a new chemical class (sulfoximines) of insecticides that control sap-feeding insects. Sulfoxaflor has been developed globally for use in major crop groups, including cotton, soybeans, rice, vegetables and apples. Containing many noteworthy features, this product has been successfully launched in US in May 2013 and South Korea in November 2011, and the full launch is expected in US, China and Australia in 2014.

In addition to sulfoxaflor, Enlist Duo^TM herbicide (glyphosate and 2,4-D choline) is also in the first wave of crop protection products. Enlist Duo^TM is used for controlling resistant weeds in genetically modified corn and soybeans that are tolerant to glyphosate and 2,4-D choline.

Arylex^TM broadleaf herbicide and new cereal fungicide comprise the second wave of crop protection products. Aiming at controlling broadleaf weed in multiple crops, Arylex^TM (halauxifen-ethyl) is the first member of synthetic auxin herbicides. The launch of this product can enhance existing strong herbicide portfolio. Currently, Arylex^TM are being evaluated across the globe in all major herbicide markets, and Dow expects its initial registrations later this year and be on the market in time for the 2015 crop season. The company anticipates annual sales of over $400 million.

Unnamed new cereal fungicide from Dow provides a tool in segments that have fungicide resistance issues, since this fungicide has a novel mode of action. This fungicide represents the first step in a planned program to build Dow’s presence in this market. Dow also pointed out that the first registration of this product is expected in 2018 in key European markets.

The third wave of crop protection products includes a new broad spectrum herbicide. This product has alternative mode of action for broad spectrum weed control, as well as for controlling most known herbicide-resistant biotypes. Effective in multiple crops at low rates, the first registration of this product is expected in 2017/2018. The annual sales are estimated at over $200 million.

In addition to these three waves of crop protection products, more high-value products are planned to launch after five years to make the company’s pipelines even more diverse. This includes three insecticides, six fungicides and four (uncategorized) novel delivery system.  

The pipeline of new seeds and traits also contains three waves of innovation, as pointed by Mr. Galindez. The first one includes genetically modified cotton WideStrike^®3, which contains insecticidal proteins (called Cry1F, Cry1Ac and Vip3A) from Bacillus thuringiensis (Bt). WideStrike^®3 has superior protection from a wide spectrum of damaging lepidopteran pests, such as cotton bollworm, and improved resistance management. It received the approval registration from US EPA last year. Dow planned to offer WideStrike^®3 exclusively in its affiliate PhytoGen starting in 2014.

The glyphosate, 2,4-D choline and/or glufosinate tolerant Enlist^TM corn and soybeans comprise the second wave of seeds products. The Enlist^TM system offers flexibility in weed control, as obviously it provides tolerance to multiple modes of action. The commercialization of Enlist^TM is expected in 2015/2016. In addition, SmartStax^® (maize with multiple insect-resistant and herbicide-tolerant traits) is also included in the second wave. This product was cooperated with Monsanto and has been authorized by EU in 2013 . According to Mr. Galindez, SmartStax^® system will be combined with Enlist^TM to deliver more solution to improve weed control. Furthermore, the Next-Generation SmartStax^®, which incorporates RNA interference (RNAi) technology, is due to be launched after 5 years.

The third wave of seeds and traits innovation includes agronomic traits and healthy oils with new functionalities, as well as Next-Generation insect resistance (e.g. novel Bt toxins and RNAi technology).