MON’s SmartStax Corn And Roundup Ready 2 Yield Soybeans To Be Priced Substantially Lower In 2011

Analysts at Deutsche Bank reiterate their "buy" rating on Monsanto MON. The target price for MON is set to $60. Deutsche Bank says, “On Wednesday, Monsanto kicked off its 5th annual "Whistle Stop" field tour in Gothenburg, NE. Day 1 highlights included the following: 1) Consistent with its revised penetration pricing strategy announced in April, SmartStax (SS) corn and Roundup Ready 2 Yield (RR2Y) soybeans will be priced substantially lower in '11 and in line with 33% value capture vs 50% in '10. 2) SS will be priced at a $20/bag premium to Monsanto's core triple stack corn seed product in '11 vs a $60/bag premium in '10. This equates to ~$113/acre for SS vs $105/acre for YieldGard VT Triple and $130/ acre for SS in '10. …..3) RR2Y will be priced at a $5-6/bag (acre) premium to RR1 vs a $12/bag premium in '10. In addition, growers will not have to purchase seed treatment ($12/bag) which they were required to in '10. As a result, RR2Y will be priced at $57/bag in '11 vs $74/bag in '10 and ~$52/bag for RR1. …4) Anecdotal yield results from the south are validating SS and VT Triple Pro (corn) with early indicators also suggesting RR2Y will show yield benefits in '10. Data from early harvests in AR, MS, TX are showing a 10-15 bu/acre yield advantage for VT Triple Pro vs competitors with 4-6 bu from earworm control and 6-9 from new genetics. Earworm pressure has increased in '10 with Monsanto's products offering unique protection against it." More Analyst Ratings here