PARIS, France (Reuters) — Monsanto plans to open its first plant in Russia in coming years as the world’s fourth largest grain producer attempts to counter the effects of a plunging ruble.
The ruble has almost halved in value against the U.S. dollar in the past year, hit by falling oil prices, a crumbling economy and political tensions.
“We have plans to increase local produced seeds in Russia and to have a facility there,” said Leticia Goncalves, who heads Monsanto’s operations in Europe and the Middle East.
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The company currently operates in Russia through a network of local partners and distributors.
It said last year that it would launch a corn seed plant in neighbouring Ukraine, whose currency has also dived, with initial investments of US$140 million and possibly rising to $300 million over several years.
Ukraine is the world’s sixth largest grain grower this season, and Goncalves said the region remained a priority for Monsanto.
“We still believe that Ukraine and Russia both are long-term opportunities for our business and we want to make sure we are in a position to accelerate our business growth despite the short-term geopolitical and macroeconomic challenges,” she said.
Genetically modified crops are not grown in Ukraine and Russia, as is generally the case in the European Union, which has been historically hostile to GM crops.
Despite a recent EU policy shift that some anti-GMO activists said might usher in GM crops, Goncalves said Monsanto did not plan to try to reintroduce GM varieties in the bloc.
Monsanto, whose MON 810 corn is the sole GM crop allowed for cultivation in the EU, withdrew all pending approval requests to grow other GM crops in the EU in 2013 because of a lack of commercial prospects there.
The EU recently reached a compromise, which gave member states the possibility to ban cultivation of a GM crop while opening the way for EU authorities to review pending approvals.
However, Goncalves said it would be difficult to operate in a non-unified market.
