When Monsanto announced on May 23 it was acquiring Precision Planting, a developer and marketer of seed meters, monitoring and precision farming technology, the news created a bit of a ripple in the farm world.
Monsanto, which is the 800-pound gorilla in the field of advanced seed genetics, said it would be an important step in growing its IFS — Integrated Farming System — platform.
When it completed the acquisition last week, Monsanto said its IFS unit “will utilize advanced agronomic practices, seed genetics and innovative on-farm technology to deliver optimal yield to farmers while using fewer resources.”
Michael Picken, analyst for Cleveland Research Co., told Farm Equipment via email that he had spoken with Monsanto shortly after the acquisition.
“Monsanto believes it can create an increase of 5-10 bushels per acre of incremental value to the farmer by improving its agronomic practices,” says Picken.
“They also believe they can do a better job than an independent crop consultant because they know the genetics in each individual area better than anyone else,” says Picken.
“The major concern I’ve heard from some growers is that they’re nervous about sharing their yield data with Monsanto — or any seed company.”
Alan Gruebert, whose column, “The Farm and Food File,” appears in 70 newspapers in the U.S. and Canada, followed up on this thought with the question: What would that information be worth?
According to Gruebert, the acquisition of Precision Planting “means that at any point in the growing and harvest seasons, Monsanto likely will know the dates, times, acreages, soil types, weather, seeding rates, yield, moisture content and just about every hard number connected to any field that uses its Precision technology. And that information won't be limited to fields planted only to Monsanto-branded seed; it will be for any field planted with any seed that uses Precision technology.”
Gruebert goes on to say, “Imagine some math wizard somewhere creating an algorithm that taps this trove of information to extrapolate planted acreages before, say, the big USDA acreage report each June or get an angle on crop production before the big crop report each August. What would that insight be worth to Archer Daniels Midland or Cargill?”
If the reported price Monsanto paid for Precision Planting — $200 million plus — is correct, “then Monsanto acquired a golden goose for chickenfeed.”
As Picken said in his note to us, “It should be interesting to see how this platform grows.”
Alan Gruebert’s website is www.farmandfoodfile.com
