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Syngenta invests in sustainable ag

Conventional pesticide makers have been under pressure over their products' impact on the environment.

By Eric Roston and Agnieszka de Sousa

Pushed by consumers and governments opposed to pesticides, and pulled by farmers needing drought- and flood-resistant crops, Syngenta Group wants to retreat from conventional chemicals into products less toxic to humans and more resilient to climate change.

“We’ll continue to drive down the use of pesticides,” said Chief Executive Officer Erik Fyrwald. “Consumers want that. Governments want that. We want it.”

Conventional pesticide makers including Syngenta and Bayer AG have been under pressure in recent years over their products’ impact on the environment and biodiversity, as more and more consumers grow more environmentally conscious and distrustful of pesticides used to produce their food.

Climate change, together with the sustainability push, is upending strategies and businesses of well-established companies from oil producers investing in renewable energy to meat producers making plant-based burgers.

As part of Syngenta’s Good Growth Plan, the company is investing $2 billion in sustainable agriculture by 2025, aiming to deliver two technological breakthroughs every year.

Safer chemistries and biotechnology will help reduce pesticides “more and more toward zero,” he said. “I don’t think it’ll get to zero.”

Fyrwald said the company has already seen in recent years predecessor advances to what he hopes will come out of the company’s increased investments, such as restoring degraded pasture in Brazil, strawberries traceable back to their farm by QR code and umami-tasting tomatoes with extended shelf lives.

Other initiatives include drought-resistant seeds and corn that helps cattle digest feed better, boosting productivity and reducing methane emissions.

Crop protection made up three-quarters of Syngenta AG’s 2019 revenue, with insecticides accounting for 15% of the total and fungicides a larger share. The company was formally combined this month into Syngenta Group.

Fyrwald said the company does “very little conventional lobbying” outside of some trade groups that he said were largely focused on competitive tax and education policies.

“I get personally involved in talking to regulators about climate change, and the need for technology to be available,” he said.

Fyrwald identified the world’s $700 billion in agricultural subsidies as resources that might otherwise “be a tremendous benefit to fighting climate change.”

Syngenta is working with farmers to educate them on using pesticides only when needed and safely. It uses digital precision agriculture, which targets diseases, weeds and diseases only where it’s needed. In China, for example, it’s expanding a network of centers where it helps farmers get higher yields while using less pesticides and fertilizers, and protecting soil and water. It charges farmers per hectare instead of per bottle of pesticide.

“Our goals are aligned - minimize the use of pesticide to control the pest,” Fyrwald said.

Climate change means longer growing seasons and warmer temperatures, encouraging pests and weeds to thrive. So farmers have been spraying more chemicals on their crops, which in turn leads to a growing resistance to the pesticides.

Biological products, which use natural ingredients from spider venom to insect sex pheromones in fighting pests, could help address this challenge and are gaining more and more customers among farmers. Syngenta is investing in developing the products and will be making acquisitions in the space, Fyrwald said.

“The future of food is consumers wanting climate-smart, climate-friendly grown and produced foods. I think that’s where the world is headed,” he said. “When consumers demand it, they’ll get it.”

To contact the reporters on this story:
Eric Roston in New York at eroston@bloomberg.net;
Agnieszka de Sousa in London at atroszkiewic@bloomberg.net
To contact the editors responsible for this story:
Liezel Hill at lhill30@bloomberg.net
David Marino
© 2020 Bloomberg L.P.
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