AgTech News In March: Stock Performance, Corporate Activity & Latest Research

Hello and welcome to the latest edition of AgTech News®! This edition updates AgTech stocks’ performances, corporate industry activities, and the latest research findings during March (Disclaimer: Not all activities are highlighted, only a selection of news/events I have chosen). Benson Hill and Syngenta Group's ADAMA reported mixed results for Q4 2022, while Corteva Agriscience announced the commercial launch of AdaveltTM active, a novel fungicide with a new mode of action. 

Additionally, Miyamoto et al. conducted a study on the functions of compost as a soil conditioner for crops. At the same time, Smith et al. investigated the impact of diversifying agriculture on cereal yields and external nitrogen fertilization levels over time. Lastly, Haddad, Nassar, and Shtaya conducted a study investigating the impacts of heavy metal contamination in irrigation water on barley's soil, shoots, and roots. 

Stay tuned for more updates on the latest trends and advancements in the AgTech industry!

AgTech Stock Performances 

Benson Hill reported mixed results for the fourth quarter of 2022, with earnings per share (EPS) of -32 cents, missing market expectations of -18 cents by a significant 76.61%. However, the company's revenue surpassed projections, coming in at $99.18 million against the anticipated $93.45 million. For the full year 2022, Benson Hill's EPS stood at -55 cents, outperforming the market consensus of -60 cents, though the revenue of $381.2 million fell short of the expected $406.1 million.

The company attributes its robust Q4 revenue to strong customer demand and an expanded offering of proprietary soy ingredients, meal, and edible oil products, nearly doubling proprietary revenues to $72.6 million. Non-proprietary revenues also saw a significant increase, driven by good soy and yellow pea commodity prices and operational excellence following the launch of two soy production facilities. In addition, the recent institutional activity saw BlackRock acquire 5.9 million shares, raising its stake in Benson Hill by 600%, while SSgA Funds Management sold 538,000 shares, reducing its stake by 13.67%.

Despite the revenue growth, Benson Hill forecasts a net loss of between $125 million and $135 million for 2023, along with an adjusted EBITDA loss ranging from $63 million to $68 million. The company remains committed to achieving positive adjusted EBITDA and free cash flow by 2025. Benson Hill's stock experienced a rollercoaster ride in late 2022, surging 18.95% in October, declining 8.26% in November, and 19.01% in December.

Syngenta Group’s ADAMA reported an 11% decline in gross profit for the fourth quarter of 2022, dropping to $304 million. However, adjusted gross profit saw a 19% increase, reaching $1,403 million. The dip in gross profit can be attributed to a decline in sales, fluctuating exchange rates, increased procurement, production, and logistics costs, and non-recurring expenses.

The company also recorded non-operational charges of $26 million in Q4 2022 and $57 million for the entire year. These charges encompass non-cash amortization charges related to the 2017 ChemChina-Syngenta acquisition, charges linked to intangible assets created as part of the Purchase Price Allocation (PPA) on acquisitions, provision for asset impairment of one of its subsidiaries, and share-based compensation for incentive plans. In addition, financial expenses for the company reached $47 million, with an adjusted figure of $271 million accounting for non-recurring, non-cash income due to the revaluation of put options.

Net income attributable to shareholders was reported at $96 million, a significant turnaround compared to a net loss of $22 million and a net income of $25 million in the corresponding periods last year. As of December 31, 2022, trade working capital stood at $2,634 million, up from $2,210 million the previous year, due to increased inventory to support sales. Net cash in investing activities amounted to $96 million for Q4 and $396 million for 2022, primarily driven by investments in ADAMA Anpon and intangible assets.

Corporate Activity 

Corteva Agriscience announced the commercial launch of AdaveltTM active, a novel fungicide with a new mode of action that protects against various diseases that can impact crop yields. ZetigoTM PRM fungicide with AdaveltTM active, now approved for sale in Canada, will be available for the 2023 growing season for use in lentil crops. Commercial sales of products containing Adavelt active will also begin this year in Australia and South Korea. Adavelt active is built on the discovery of InatreqTM active, a natural origin fungicide developed by Corteva with proven effectiveness for many crops. It features a novel target site of action in many crops with no cross-resistance to other modes of action. As a result, it has a firm fit in existing integrated pest management programs as a resistance management tool. By adding Adavelt active to disease management programs, farmers can simplify fungal control efforts and reduce resistance risks while protecting crop yield potential and quality.

Corteva Inc., Bunge Inc., , and Chevron U.S.A. Inc. have announced a commercial collaboration to introduce proprietary winter canola hybrids that produce plant-based oil with a lower carbon profile. The goal is to increase the availability of vegetable oil feedstocks primarily for the growing domestic renewable fuels market. The companies plan to introduce the winter canola crop into the southern United States to create a new revenue opportunity for farmers with a sustainable crop rotation. Bunge Chevron Ag Renewables plans to contract with farmers to purchase the harvested winter canola crop and use the oil to produce renewable fuel. A pilot program is expected to be conducted in the 2022-23 growing season to fine-tune best management practices.

Syngenta Crop Protection and Aphea.Bio has announced a new collaboration to accelerate the introduction of a novel biological seed treatment solution across multiple European countries over the next five years, pending regulatory approval. ACTIV by Aphea.Bio® is a biostimulant applied as a seed treatment on wheat that is based on beneficial microorganisms and enables up to five percent higher yields even with reduced fertilizer use. The collaboration demonstrates Syngenta's commitment to bringing novel, nutrient-use efficiency solutions to growers, helping safeguard yields if nitrogen inputs are reduced. Aphea.Bio CEO and co-founder Isabel Vercauteren said the collaboration is an additional building block in achieving healthy soils by supporting crops through beneficial microorganisms and has the potential to contribute to the goal of the European Union’s Green Deal to reduce the use of synthetic fertilizers inputs.

Bioceres Crop Solutions Corp. , a global provider of crop productivity solutions designed to enable the transition of agriculture toward carbon neutrality, announced that CTNBio, the National Biosafety Commission of Brazil’s Ministry of Science, Technology, and Innovation, has concluded the safety evaluation of HB4 Wheat, providing full approval for commercialization and cultivation in Brazil. This approval builds on Brazil’s previous approval for food and feed use of HB4 Wheat flour in November 2021. It enables the acceleration of Bioceres’ collaboration with EMBRAPA to develop subtropical wheat varieties to increase the supply of local materials in this geography. In addition, HB4 Wheat offers the potential for double cropping – rotating wheat with a summer legume – in regions currently limited by water availability. This approval paves the way for the technology to deliver $15-$20 million in incremental EBITDA by FY24. Brazil is the second country where regulatory agencies have cleared HB4 Wheat for cultivation and completed the approval processes for the company’s wheat target markets in Latin America.

Bee Vectoring Technologies International Inc. has announced positive second-year trial results demonstrating the efficacy of its proprietary biological control agent Clonostachys rosea strain CR-7, as a seed treatment on soybeans. Results showed that adding CR-7 over base seed treatment results in higher yields, as measured over 16 replicated plots across four locations, and that CR-7 was equivalent to the chemical standard in terms of effectiveness. Other measures on plant health, vigor, and biomass showed the same positive outcomes. The 2022 trials continued assessing the efficacy of CR-7 added over base seed treatment on plant biomass and vigor and demonstrated its effectiveness against disease and soybean crop yields. BVT's corporate market strategy focuses on soybeans, a major row crop with 320 million acres grown globally. 80% of American soybeans receive seed treatment before planting, and 50% undergo a biological inoculant treatment. BVT intends to partner with seed treatment companies with the expertise and channel access to accelerate their reach into this soybean acreage. Trial data from years 1 and 2 confirmed that adding CR-7 over base seed treatment led to plants being healthier in the vegetative stage and was statistically equivalent to both biological and chemical standard treatments for SDS. This data enables BVT to provide growers with a product that addresses many needs with zero adverse effects on crop safety.

Research Result 

Miyamoto et al. conducted a study to explore the functions of compost as a soil conditioner for crops. They investigated the omics profiles of carrots in a field amended with compost fermented with thermophilic Bacillaceae for growth and quality indices. The results showed that exposure to compost significantly increased the productivity, antioxidant activity, color, and taste of the carrot root and altered the soil bacterial composition with the levels of characteristic metabolites of the leaf, root, and soil. The study utilized structural equation modeling (SEM) to estimate the optimal links between plant and soil factors. The data suggested that plants' amino acids, antioxidant activity, flavonoids, and carotenoids were optimally linked by exposure to compost. At the same time, the genus Paenibacillus and nitrogen compounds were optimally involved in the soil. These findings suggest a complex cascade of plant growth-promoting effects and modulation of the nitrogen cycle by the compost itself, highlighting the potential for chemically independent sustainable agriculture through the efficient use of natural nitrogen.

Smith et al. conducted a study to investigate the impact of diversifying agriculture on cereal yields and external nitrogen fertilization levels over time. The study utilized grain yield data of small grain cereals and maize from 32 long-term experiments across Europe and North America. The results showed that crop rotational diversity, measured as crop species diversity and functional richness, enhanced grain yields, and this yield benefit increased over time. Winter-sown small grain cereals were the only crop to show a decline at the highest level of species diversity. Increasing crop functional richness rather than species diversity was identified as a strategy for supporting grain yields across many environments, particularly for all cereals with low external nitrogen input, including maize, enabling a lower dependence on nitrogen fertilizers, ultimately reducing greenhouse gas emissions and nitrogen pollution. These findings support diversifying agriculture as a promising practice to reduce the negative impacts of crop production on the environment while maintaining yields.

Haddad, Nassar, and Shtaya conducted a study investigating the impacts of heavy metal contamination in irrigation water on barley’s soil, shoots, and roots. The study focused on the effects of nine heavy metals, including Cd, Cr, Cu, Ni, Pb, K, Fe, Mn, and Zn, commonly found in urban wastewater with input from local industrial factories. Barley was grown in plastic pots filled with sandy soil irrigated with simulated treated wastewater during two growing seasons, with metal treatments including one, three, nine, and 15 multiples of the average metal content of treated effluent. The results showed that while barley showed similar growth responses, it exhibited different metal uptake patterns. Cd, Fe, Pb, and Zn in the roots and shoots of barley were higher than WHO permissible levels, while all metals accumulated in the soil were lower than WHO permissible. In addition, the study found that the average value of enrichment factor (EF) for most heavy metals was around unity, indicating poor enrichment to soil and translocation to roots and shoots. The highest Translocation factor (TF) and Bioconcentration Factor (BCF) were observed for K, indicating its role in enhancing barley's tolerance to drought and its effectiveness in using barley in phytoremediation. However, repetitive and increased irrigation with heavy metals wastewater significantly affected barley growth and development and soil quality parameters. These findings highlight the need for more sustainable and environmentally-friendly irrigation practices to reduce the negative impacts of heavy metal contamination on crops and soil.

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