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As chemical industry struggles, seed units shine

April 01, 2009
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Even in a recession, people need to eat. And right now that''s a saving grace for chemical companies with agricultural businesses. According to the Associated Press, slumping consumer confidence has led to fewer purchases of products made from traditional chemicals, like paints or plastics. But shoppers are still buying food. There''s also been a renewed interest in locally grown produce and home gardens. That''s kept the chemical industry''s agricultural units busy engineering seeds that help farmers protect what they grow, and grow more of it. About 320 million acres of farmland were planted in the United States in 2007, or 8 percent of total land area, according to the Department of Agriculture. The number is roughly in line with figures from 50 years ago, but the nation''s population has jumped about 74 percent since then, sharply boosting food demand. Globally, only about 36 percent of suitable crop land is farmed. That''s unlikely to increase much in coming years due to lack of water and other resources in some regions, causing an even greater reliance on higher-yielding seeds, according to the United Nations Food and Agriculture Organization. It''s those seeds, and related products like fertilizer, that have been a bright spot amid an otherwise gloomy financial storm for chemical makers. The seed business caught the chemical industry''s eye in the 1990s, leading Dow Chemical and DuPont to form agricultural units through acquisitions. While efficient products endear chemical companies to their customers, outreach helps, too. DuPont''s Pioneer unit actually hired workers in 2008 -- a contrast to economy-wide layoffs -- and employs a traveling sales staff of more than 800.

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