Monsanto Canada says its decision to offer a cheaper version of Roundup Transorb has nothing to do with increased competition from imported generic glyphosate.
“We don’t make our business decisions based on what other people do,” said Monsanto spokesperson Trish Jordan.
“We basically make our pricing and business decisions based on the feedback we get from our customers.”
It turns out the customers wanted a less expensive version of their herbicide.
To meet that demand, Canada’s leading distributor of glyphosate is launching a new product called Roundup Transorb HC, which offers farmers preseed control of annual weeds at a cost of $2.99 per acre.
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Although it is priced similar to the old Roundup Transorb brand, the new product comes in a highly concentrated formula, allowing growers to cover more acres per litre handled. It will be competing directly with imitator glyphosates.
“Roundup Transorb HC will provide an opportunity for generic users of glyphosate to consider the use of a quality Roundup brand herbicide at a great price without worrying about performance, quality or availability. There are no rebates, memberships or paperwork hassle,” said Randy Barker, Roundup marketing manager for Western Canada.
Farmers of North America, the bulk buying group that paved the way for a flood of low-priced glyphosate imports in 2005, is taking credit for Monsanto’s actions.
“There is absolutely no doubt this is a response to FNA,” said FNA vice-president Glenn Caleval.
Farmers imported 5.7 million litres of generic glyphosate from the United States through the Pest Management Regulatory Agency’s own-use import program last year, a volume that represents 18 percent of annual sales of the herbicide.
The popularity of the program took everybody by surprise, including the PMRA, which is reviewing its OUI program.
It sprang to life when Farmers of North America, through a series of submissions, was able to convince the PMRA that a glyphosate called ClearOut 41 Plus was chemically equivalent to products already sold in Canada.
Once it received the regulatory nod, the organization began filing import forms on behalf of its members to bring in truckloads of ClearOut 41 Plus at a cost to farmers of about $4.25 per litre.
Caleval said it is clear from Barker’s comments about memberships and paperwork that Monsanto sees FNA’s initiative as a growing threat to its dominance in the glyphosate market.
Fill a niche
But Jordan said the company was simply addressing the fact it had no product in the market at that price range.
Roundup Transorb HC will be offered at a suggested retail price of $8.97 per litre, but since growers get more coverage from the concentrated formula, it works out to $5.98 per litre when compared to competitive products like ClearOut 41 Plus.
The move positions Roundup head-to-head with Touchdown iQ, Glyfos, Vantage Plus and ClearOut 41 Plus, said Jordan, who added that Monsanto’s new offering outperformed imitators in the company’s field and greenhouse trials conducted in 2005.
Caleval said FNA is pleased any time a chemical company reduces its prices because the goal of the group is to improve farmer profitability.
But he accused Monsanto of playing a game of smoke and mirrors by boosting concentration levels of the active ingredient rather than launching a lower-priced product, claiming the tactic substitutes cheap active ingredient for more expensive surfactant ingredients.
He said ClearOut 41 Plus is still $1.73 per litre cheaper than the newest Roundup offering, delivering spring burndown control at a cost of $2.12 per acre.
And he dismissed Monsanto’s claims of superiority.
“These are false claims,” said Caleval.
Trials at a variety of universities in Canada and the U.S. show ClearOut 41 performed as well or better than brand name products like Roundup Transorb, he said.
“Glyphosate is not like Nike runners. Farmers can’t afford to be paying for a label. They need to be paying for performance.”
But Jordan said there are substantial differences between the two products, not only in performance but in the fact that Roundup Transorb HC comes with a 30-year track record, a 60-minute rainfastness guarantee and the customer service provided by Monsanto’s retail distribution network.
Supporting that network is a priority for the chemical company.
“We have a commitment to that customer as well,” said Jordan. “The OUI program can’t deliver that same commitment.”
