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Monsanto Jumps Back Into Wheat

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Five years after shelving a controversial biotech wheat product, Monsanto said July 14 it is jumping back into the wheat business, paying $45 million to acquire WestBred LLC, a specialist in wheat germplasm.

Monsanto said in the near term, the transaction will allow Montana-based WestBred to apply Monsanto breeding tools to develop higher-yielding varieties for U.S. wheat farmers.

And in the future, WestBred’s wheat germplasm will serve as the foundation for the development of biotech traits that make wheat plants more drought tolerant, more efficient in the use of nitrogen and higher yielding.

Monsanto, which is known for its market strength in development of genetically modified soybeans, corn, cotton and other crops, walked away from development of a “Roundup Ready” herbicide-tolerant spring wheat product in early 2004.

The company’s decision came amid complaints that export markets would shun U.S. wheat if biotechnology was introduced to the key food crop.

Public attitudes have changed since then and leading wheat industry players are now clamoring for help in making wheat production more efficient and profitable, the company said.

“Obviously you’ve seen dramatic changes in the landscape since Monsanto was involved in the space,” said company spokesman Lee Quarles.

Still the company said it was not likely to revisit its herbicide-tolerant type of wheat.

At the time, wheat farmers complained that herbicide tolerance for wheat was not a trait that was really needed, and would likely be more beneficial to Monsanto, which sells the Roundup herbicide, than it would be to wheat farmers.

WestBred, which has been owned indirectly by Barkley Seed, Inc, has germplasm assets in all classes of wheat. WestBred’s existing breeding capabilities and commercial operations will become the centerpiece of Monsanto’s wheat platform, officials said.

In addition, Monsanto will seek public and private partnerships to commercialize its new wheat products.

The deal is not expected to be accretive to earnings until the middle to latter part of the next decade.

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