(Photo: Executive board member, Hagen Duenbostel, traveled to Argentina for the inauguration of the Ocampo facility)
Buenos Aires, August 28th. Last week the local branch of seed company KWS inaugurated its corn seed processing and classification plant in Manuel Ocampo, near to Pergamino city, where most of the seed companies in Argentina have their facilities. KWS Argentina acquired the original plant in 2012 to agro-industrial company Kruger and then began a re-engineering process that was completed this year. Now, the plant has the capacity to process 700,000 corn bags per year and accounts with the ultimate technologies for the treatment of the seed during the pre-cleaning, cleaning and conditioning process.
“Today, corn seed business represents 99% of our income in Argentina. We currently have a 5/6% of the market share, and the target is to duplicate it in the coming years”, the chairman of KWS Argentina, Sebastián Vila, said in a dialogue with eFarmNewsAr.com.
“We are strongly focused on improving our seed portfolio to farmers. We develop cent percent of the corn germplasm in the country, through our R+D center in Chivilcoy city (Buenos Aires province) and we are opening a second research center in the Cordoba province, focused on tropical and subtropical corn germplasm, which also it is well adapted to late planting”, Vila opined. He added that they are also breeding corn in Salta province (in the north of the country) but in an outsourcing way.
The company has a strong position supplying silage hybrids. Vila estimates that 35% of the corn seed sales come from those hybrids. The goal is to expand the offer to high yield grain hybrids, to compete with the other global seed companies. “We are launching new materials with very high potential yields. These hybrids were tested in plots with excellent results”, Vila added.
EfarmNewsAr asked the official how is the relationship with the biotechnologies companies, which provide the traits that breeding companies pile in their germplasm. “Two years ago KWS signed an agreement with Syngenta to use its traits. Currently, 95% of our portfolio use the Syngenta traits, but we are opened to use other traits, for instance from Monsanto (Bayer)”, Vila stated.
In the commercial aspects, KWS Argentina is moving from a dealers channel strategy to direct sales to farmers. “We consider that proximity is a great argument to sell our hybrids. Farmers value so well the direct contact with our technicians, who provides them also with agronomic information”, he argued.
But the company face a hard terrain to develop its growth. Acquisitions and fusions in the seed business increased the competition between them. According to eFarmNewsAr sources in the seed business, competence between the giants has plunged the corn seed prices in the local market. “It’s a correct approach. We face the challenge to growth in a highly competitive market, but we are confident that the quality of our portfolio will be able to us to duplicate the market share until 10 or 12 percent”, Vila concluded.
In the Manuel Ocampo facility, KWS invested 12 million euros and another 8 million will invest in Argentina in the next years, to consolidate the local operation. But the company is also investing in the Mercosur. In Patos de Minas location (Brazil), they are doubling its corn seed processing capacity, to more than two million units per year, according to the company. “Brazil and Argentina owns a relevant corn area from a global perspective, and the company wants to grow in this region”, the president of KWS Argentina told to eFarmNewsAr.com.