Tag Archives: #DuPont

Patch Job

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A study published earlier this year pointed to a decrease in the size of the ozone hole over the Antarctic.

This healing process indicates the success of the Montreal Protocol, the 1989 treaty intended to limit the production and use of ozone-harming chemicals.

Ratified by all United Nations Members, as well as Niue, the Cook Islands, the Holy See and the European Union, it’s been hailed as “perhaps the single most successful international agreement to date.” (Kofi Annan)

Ten Circles - magnolia leaf crotched with cotton yarn Artist: Susanna Bauer

Ten Circles – magnolia leaf crotched with cotton yarn
Artist: Susanna Bauer

It’s worth noting that the movement to reduce the production and use of gases that affect the ozone layer came long before ‘scientific consensus’ was actually reached.

Like the discussion surrounding carbon emissions and climate change, scientists who argued for a reduction in chlorofluorocarbon (CFC) production and use (mainly for refrigeration purposes and aerosol spray propellant) faced an array of opposition.

One, Two, Three Artist: Susanna Bauer

One, Two, Three
Artist: Susanna Bauer

DuPont held the patent for Freon, a CFC widely used around the world, but one which was losing profitability. The company put up aggressive arguments against any regulation of CFC production for several years – while searching for replacement alternatives.

The publication of ozone hole images in the 1980s focused public attention on the issue, just around the time DuPont felt it had found viable gas alternatives and the Freon patent had expired.

DuPont switched course, became an active supporter of CFC limitation and a strong proponent of international action. It also earned itself a reputation as a company concerned with the environmental impact of its products. (It bears mentioning that most of the alternative products also count as harmful greenhouse gases with varying levels of atmospheric toxicity.)

Common Ground (II) Artist: Susanna Bauer

Common Ground (II)
Artist: Susanna Bauer

The Montreal Protocal was the result of a rare confluence of public opinion, environmental interests and corporate action. Corporate and government reluctance to limit CFC production was otherwise similar to today’s climate change discussion.

In the end, it always seems to come down to habits, inertia and money (or lack thereof) on the one side, and an amassing of scientific proof and activism on the other.

Moon (II) Artist: Susanna Bauer

Moon (II)
Artist: Susanna Bauer

Perhaps what the Montreal Protocol really had going for it was the image of the hole in the atmosphere, a singular lens that could focus attention, fears, research and opinion.

It’s profoundly encouraging that the positive effects of an international treaty on a large-scale environmental challenge can be measured in a relatively short span of time.

Here’s hoping this visible progress can impact the usual cost-benefit conversations when it comes to climate change negotiations.

Images of the Antarctic ozone hole. If current trends continue, the hole is expected to close by 2040. Images/graphic: NASA Goddard Space Flight Center/ Business Insider

Images of the Antarctic ozone hole. If current trends continue, the hole is expected to close by 2040.
Images/graphic: NASA Goddard Space Flight Center/ Business Insider

 

Future Investment

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Seeds 2 (pure fractal flame) Artist: Cory Ench via Fractal World Gallery

Seeds 2 (pure fractal flame)
Artist: Cory Ench via Fractal World Gallery

This year marks the first time that all Monsanto Roundup Ready genetically-modified seeds will be off-patent. This means that any company can start making ‘generic’ versions of the GM soybeans, corn and so on – unless, of course, their use and the use of the companion Roundup-based herbicide has been banned*.

The path ahead is complex. Up until now, the source of these particular GM seeds was Monsanto, together with companies to which Monsanto had licensed the use of the these products. As of 2010, this accounted for a staggering 98% of soybean seed and 79% corn seed salesĀ  in the world.

A double-edged sword: On the one hand, Monsanto vigorously guarded the use of its product, taking even farmers who had never planted Roundup Ready seeds to court because open pollination had left them with traces of GM crops in their fields. But it also meant that farmers who might like to ‘go GM’ didn’t due to contractual or pricing concerns. Well, those concerns may fade now, and GM use may spread.

It’s always interesting to take a look at this issue from a different perspective, and sometimes I do that by reading the investment news on seed and chemical companies.

Last year, an article on MSN Money took a look at the Big Three seed companies: Monsanto, Syngenta and DuPont. In choosing which seed company was the best investment, author Jim J. Jubak factored in the loss of patent control, as well as how much of each company’s revenue was actually seed-based (high margin), how much was based on chemical crop protection (‘volatile’), and how much was in other sectors.

Seeds (pure fractal flame) Artist: Cory Ench via Fractal World Gallery

Seeds (pure fractal flame)
Artist: Cory Ench via Fractal World Gallery

In brief, Jubak recommended DuPont. Why? Because the company had none of Monsanto’s patent problems, was shedding its non-seed businesses and buying up seed companies, and was the most focused of the three on the core: Creating and selling seeds.

Why should investors want seed companies in their portfolio? As Jubak said, “By 2050 the world will have a population of 9 billion (very scary) and the world’s farmers will need to double grain production in the face of losses of farmland to urbanization, desertification, drought and pollution.

“That means getting more calories from the world’s food plants by improving yields, by increasing resistance to disease and pests, and by expanding farm production to land that is now marginal because of climate or rainfall (while at the same time resisting attacks on global food production from changes in climate and an increasing incidence of drought.”

For what it’s worth, Jubak was mostly right: Since the article was written in July 2013, Dupont‘s stock has gone up by 16.6 %, Monsant0‘s by 12.59%, and Syngenta‘s has gone down by 6.08%. If Monsanto was going to suffer from the loss of its patents, it hasn’t come through in its stock price.

Now, what’s the point of looking at seeds from an investor’s perspective?

Genetic Code Revisited  Artist: Cory Ench via Fractal World Gallery

Genetic Code Revisited
Artist: Cory Ench via Fractal World Gallery

Because that’s what seeds are. You can see them as an investment in the baldest sense of financial gain, without the baggage of other concerns except as a motivating investment factor.

You can also see them as an investment in the future in terms of feeding the planet, maintaining and promoting biodiversity (both plant and animal), enriching lives and soil, and as a continuation of what we as humans have been doing for millennia.

The two views don’t have to be mutually exclusive, but for the moment, it seems that they are.

 

*Current bans on use of glyphosate products are in force inĀ Denmark, El Salvador and Sri Lanka.