November 16, 2005

GM corn for animal feed to be commercialised
 

Renessen LLC, a joint venture of Monsanto Co. and Cargill Inc., is planning to commercialise a GM corn for animal feed.

The company said the corn carried added lysine in each kernel, and was expected to reach US and Argentine poultry and swine producers in 2007 or 2008. It was developed to replace synthetic supplements of lysine that producers currently bought and mixed into feed.

Monsanto and Cargill have already invested US$444.5 million in Renessen, which had yet to produce a return. This latest development marked the first major commercial launch for Renessen. Both investors said they fully supported the joint venture, and acknowledged that lots of R&D expenses were needed before returns could finally be achieved.

Renessen gained total revenues of US$24.4 million between its formation in January 1999 and August this year. But this was yet to fully cover the investment amount, which included US$335.9 million in R&D expenses.

The GM corn would contain 1,000 ppm of lysine, about one-fourth of the amount needed in a standard broiler's diet. However, Renessen said it has also been developing a second-generation product that should contain an entire dose and fully displace supplements.

Renessen said the new product held great prospects as it drew on Monsanto's breeding expertise and seed germplasm. Cargill would be responsible for marketing the idea and managing logistics to ensure the product was kept separate from other corn varieties, as well as smooth deliveries to end users.

In addition, Renessen said it had to ensure key export markets such as Japan approved the new product, in order to gain support of growers. The company had also sought official approval in Japan, Canada, Korea, Taiwan and Malaysia.

Profits from the new product would be shared equally between Monsanto and Cargill.