Are Stacks on Stacks From Dow Chemical Company a Superweed's Worst Nightmare or Best Friend?

New crops can for the first time resist multiple herbicides. What does this mean for Dow Chemical, Monsanto, and the future of superweeds?

Jul 13, 2014 at 1:39PM

The spread of genetically enhanced agricultural crops in the United States has been nothing short of amazing. Since arriving on the commercial scene in 1996, soybeans, cotton, and corn engineered to withstand herbicides, insecticides, or both had captured as much as 93% of their respective market as of 2013. That has meant big business for trait companies such as Monsanto (NYSE:MON), Dow Chemical (NYSE:DOW), and Syngenta (NYSE:SYT).

Images

While the success of biotech crops has been driven by providing farmers viable pest control options to boost yields and profits, it's important to remember that they're just another tool. That means their benefits can be washed away if used improperly. Careless use (farmers) and poor monitoring (companies, regulators) of biotech crops will inevitably lead to the emergence of resistant pests. Indeed, there are now weeds that can survive glyphosate, or Roundup, and corn rootworms that can turn the other cheek to the natural toxin from Bacillus thuringiensis, or Bt.

Superpests would emerge even in a world without biotech crops, but over-reliance on single pesticides and refusal to plant refuge plots amplify the selective pressure for resistance. How do you make it easier for farmers to follow the rules? Refuge-in-a-bag products will provide a partial solution to the lack of refuge plots. Tackling the problem of superweeds will require a bit more novelty. Luckily, Dow Chemical is nearing approval of its Enlist Weed Control System, which consists of a proprietary mixture of glyphosate and 2,4-D herbicides -- and crops that can resist lethal doses of both.

Enlisting science!
Giving farmers a crop that resists lethal doses of one herbicide can lead to obvious problems. It's not that farmers are widely applying too much glyphosate for any given harvest (that would cost serious cash), but using glyphosate every harvest, rather than cycling through herbicides to decrease the selective pressure for resistance in weeds, adds up over time. So, why not make a crop that resists more than one herbicide? Well, that's exactly what Dow Chemical conjured up.

Stacked traits may sound like a new invention, but they are actually more common than single traits thanks to robust trait licensing practices within the industry. While glyphosate-tolerant crops are most commonly associated with Monsanto, nearly every major seed company wields similarly hardy crops. For instance, Agrisure 3000GT corn from Syngenta provides farmers herbicide tolerance (glyphosate) and insecticide tolerance (Bt), as do multiple other brands for cotton, soybeans, and corn.

G

Despite the dominance of stacked traits, the new Enlist system will pioneer stacking multiple herbicide traits. If the spectacular success of first-generation stacked traits is any indication of what awaits Enlist and others, then Dow Chemical and Monsanto could be on the cusp of another spectacular growth phase.

How will it work? Farmers will apply a mixture of glyphosate and 2,4-D (the most widely used herbicide in the world) supplied by Dow Chemical to their fields. The company, the U.S. Environmental Protection Agency, the U.S. Department of Agriculture, and farmers are hoping the new stacked herbicide traits slow the spread of superweeds. Others aren't so sure.

Potential problems on the horizon?
Unfortunately, the future isn't as rosy as seed and trait developers would like. Although there is a massive body of evidence supporting the safety of 2,4-D, there are disagreements over interpretations of that data. Meanwhile, the USDA expects use of the herbicide to increase by as much as 576% from 2011 applications. That could be good for Dow Chemical, but potentially bad for the environment. Scientists are also wary of the benefits of stacked herbicide traits. They would be welcomed tools now, but would they create more superweeds faster in the long run?

Of course, there is obvious value to stacked herbicide traits. While Enlist is meant to be used with a mixture of glyphosate and 2,4-D, future crops might tolerate multiple herbicides while they are cycled over multiple harvests. One year farmers would use glyphosate, the next year farmers would use 2,4-D, the next yet another. Such a system would allow modern agriculture to truly reap the benefits of biotech and work to slow the emergence of superweeds.

Foolish takeaway
Stacked traits developed by and licensed between Monsanto, Dow Chemical, and Syngenta wouldn't be wildly successful if farmers didn't find them useful -- and Enlist should be no different. If two traits aren't enough to convince you that superweeds may be dead, consider the near future. According to Wired, Dow Chemical has "patented a mechanism that would allow up to nine types of herbicide [tolerance] to be engineered into a single plant." That would lay the groundwork for cyclical herbicide applications and drastically slow -- and perhaps even reverse -- the spread of superweeds. Investors stay tuned.

TREND TRACKER: Warren Buffett: This new technology Is a "real threat"
At the recent Berkshire Hathaway annual meeting, Warren Buffett admitted that an emerging technology is threatening the Oracle of Omaha's bread and butter. And it's no long a question of "if... but when," according to the industry's foremost research firm. Find out how you can cash in on this technology BEFORE the crowd catches on, by jumping onto one company that could get you the biggest piece of the action. All the details are laid out in a new FREE investor alert from The Motley Fool. Click here now to learn more!

Maxx Chatsko has no position in any stocks mentioned. Check out his personal portfolioCAPS pageprevious writing for The Motley Fool, or his work for SynBioBeta to keep up with developments in the synthetic biology industry.

The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Money to your ears - A great FREE investing resource for you

The best way to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as “binge-worthy finance.”

Feb 1, 2016 at 5:03PM

Whether we're in the midst of earnings season or riding out the market's lulls, you want to know the best strategies for your money.

And you'll want to go beyond the hype of screaming TV personalities, fear-mongering ads, and "analysis" from people who might have your email address ... but no track record of success.

In short, you want a voice of reason you can count on.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich," rated The Motley Fool as the #1 place online to get smarter about investing.

And one of the easiest, most enjoyable, most valuable ways to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as "binge-worthy finance."

Whether you make it part of your daily commute or you save up and listen to a handful of episodes for your 50-mile bike rides or long soaks in a bubble bath (or both!), the podcasts make sense of your money.

And unlike so many who want to make the subjects of personal finance and investing complicated and scary, our podcasts are clear, insightful, and (yes, it's true) fun.

Our free suite of podcasts

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. The show is also heard weekly on dozens of radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable. Rule Breaker Investing and Answers are timeless, so it's worth going back to and listening from the very start; the other three are focused more on today's events, so listen to the most recent first.

All are available for free at www.fool.com/podcasts.

If you're looking for a friendly voice ... with great advice on how to make the most of your money ... from a business with a lengthy track record of success ... in clear, compelling language ... I encourage you to give a listen to our free podcasts.

Head to www.fool.com/podcasts, give them a spin, and you can subscribe there (at iTunes, Stitcher, or our other partners) if you want to receive them regularly.

It's money to your ears.

 


Compare Brokers