According to Bloomberg Businessweek, Monsanto will be cutting prices for Roundup in the face of rising competition from generics.
Here’s more from Businessweek:
The St. Louis biotech giant also cut its annual outlook and share prices tumbled 7 percent in early trading. Monsanto said cheaper and fewer weedkiller offerings will cut earnings per share by 50 to 70 cents this year. Annual earnings are now projected to be between $2.15 and $2.41. Earnings for the third quarter are expected to range between 65 and 72 cents a share. Last month, Monsanto reported that its second-quarter profit fell 19 percent to $887 million.
Chinese companies flooded the market with cheap varieties and CEO Hugh Grant said farmers are unwilling to pay premium prices for the Monsanto’s new lines of biotech seeds, some of which are twice as expensive as the varieties most farmers grow today.
“By reducing the uncertainty associated with Roundup, we free Monsanto to grow on its fundamentals,” Grant said. “What matters to our long-term growth is our seeds-and-traits business, which is on track.”
Company shares fell $3.80 to $48.86
Posted by Haylie Shipp