SPECIAL REPORT-Food: Is Monsanto the answer or the problem?
* Company wants to lead a second "Green Revolution"
* Will poor farmers get hooked on its pricey technology?
* History of controversy complicates humanitarian efforts
By Carey Gillam
ST. LOUIS, Nov 11 (Reuters) - Norman Borlaug, the father of the Green Revolution of the 1960s and 1970s, had only months to live when he received a visit from an old friend, Rob Fraley, chief of technology for Monsanto Co.
Borlaug, who won the Nobel Peace Prize in 1970 for his work increasing food production in starving areas of the globe, welcomed Fraley to his Dallas home, where the two men sipped coffee and tea and discussed a subject dear to their hearts: the future of agriculture and the latest challenges of feeding the human race.
Fraley, who first met Borlaug 20 years earlier, when they served as founding board members for an agricultural group that works with developing nations, said he showed his friend photos of new types of corn that Monsanto (MON.N) was developing. Using biotechnology and genetic transfers, Monsanto, the world's largest seed company, hoped to create a corn variety that could grow well in dry conditions, even in drought-prone Africa, helping to alleviate hunger and poverty -- and fatten its bottom line.
"We were showing him some of the pictures of the drought-tolerant corn," Fraley recalled. "You could see his eyes were starting to well up, and I said, 'Norm, what's wrong?' He said, 'Rob, I've made it all the way through the Green Revolution. I don't think I'm going to make it through the gene revolution.'"
The topic of Fraley's final conversation with his friend that day underscored the unfolding of a modern era of global agriculture. In this new paradigm, traditional plant breeding is giving way to the high-tech tools of rich corporations like Monsanto, which are playing an increasingly powerful role in determining how and what the world eats. It is also generating controversy, as critics continue to question the safety of biotech crops, and fear increasing control of the global food supply by giant corporations.
Still, few dispute that something needs to be done. The United Nations has said that food production must double by 2050 to meet the demand of the world's growing population and that innovative strategies are needed to combat hunger and malnutrition that already afflict more than 1 billion people.
Amid this dire outlook, St. Louis, Missouri-based Monsanto -- along with its biggest corporate rivals, charitable foundations, public researchers and others -- is forming a loose coalition of interests instigating a second Green Revolution. "What we do builds on what he started," Fraley said of Borlaug, who died in September at the age of 95.
Founded in 1901 as a maker of saccharine, Monsanto has undergone several evolutions of its own. The company spends an estimated $2 million a day on agriculture research and development -- more than any other company. It employs about 400 scientists in four St. Louis-area research facilities, applying an array of new technologies to plant genetics, with a goal of doubling yields in major crops, such as corn and soybeans, between now and 2030.
"If we do that successfully, it won't just be good for Monsanto, it will be good for the world," Fraley said.
As it positions itself to be a leader in advancing a global fight against hunger, Monsanto has started working with nonprofit organizations in poor nations, donating research and genetics to help needy farmers.
The moves run parallel to Monsanto's commercial sales of high-priced seeds and agricultural chemicals to farmers in wealthy nations, which has made the company a darling of Wall Street and helped it post record net sales of $11.7 billion and net income of $2.1 billion for fiscal 2009.
The U.S. Department of Agriculture and governments around the world are encouraging Monsanto -- as well as rivals DuPont (DD.N), Dow Chemical (DOW.N), BASF BASF.DE and other corporate interests -- to work with academics, foundations and public institutions on how to increase food production globally.
Drought-tolerant crops, particularly corn, are high on the agenda amid concerns about a changing climate. Improved wheat is also a major goal.
Corn and wheat account for about 40 percent of the world's food and 25 percent of calories consumed in developing countries, and millions of people get more than half of their daily calories from corn and wheat alone, according to the United Nations' Food and Agriculture Organization.
"We want to encourage the private sector to help shape research. These are important issues for all Americans and the world," said Roger Beachy, President Barack Obama's newly appointed director of the U.S. National Institute of Food and Agriculture.
Critics say the nonprofit work is a way for Monsanto to get even the world's poorest farmers hooked on pricey patented seed technology. But Monsanto and biotech supporters say it is the only way to grow enough food to feed a world population expected to hit 9.4 billion by 2050.
"Global ag production must grow by 70 percent by 2050, and it will have to come out of increased yields because there is only a minimal amount of new land that can be put into production without environmental problems," said Mary Boote, executive director of an industry group called the Truth About Trade and Technology. "Biotechnology has to be one of the tools we use."
MAIZE FOR AFRICA
Monsanto's humanitarian work in Mexico, Africa, India and elsewhere is still in the early stages. One of its largest projects is participation in the development of a type of maize -- a major food source for 300 million Africans -- that grows better in drought-prone areas of the continent.
"Drought is at the top of the list as a challenge for farmers there," said Natalie DiNicola, director of global development partnerships for Monsanto.
Monsanto is working with African researchers in a partnership launched in March 2008 with funding from the Bill and Melinda Gates Foundation and the Howard Buffett Foundation. The company is donating some of its genetic "markers" and other breeding resources. Five African nations -- Uganda, Kenya, Mozambique, South Africa and Tanzania -- are testing sites.
The work comes at a time of "tremendous need" for African farmers, who sometimes suffer complete crop failures due to drought, said Daniel Mataruka, executive director of the Kenya-based African Agricultural Technology Foundation.
"The strategy of the whole project is to ensure there is yield stability ... that there is some kind of yield," Mataruka said.
Along with helping poor farmers obtain better seeds, the project is also educating and assisting them in proper use of fertilizers and land management. While Monsanto's short-term goal is "global good," the company hopes that eventually the farmers it helps will become commercial customers.
"There is an absolute need to help these farmers ... make them more food-secure and help them climb out of poverty," said DiNicola. "We would hope that projects like this one and others are going to lift them out of poverty enough that someday the market is working and they can become customers for us."
The company's work on drought-tolerant crops for African farmers dovetails with research for a commercial drought-tolerant corn that Monsanto hopes to have on the market by 2012. Racing rival DuPont, which also is developing a drought-tolerant corn, Monsanto is experimenting with a number of gene combinations to stimulate greater photosynthesis, improve root structures, and enhance other characteristics so the transgenic corn can yield more kernels with less water.
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