Monsanto flagged a "landscape change" in the farm sector as it ditched its long term profit target and flagged that this year's earnings would come in below investors' forecasts.

The seeds and sprays giant said that, half way into a five-year growth plan, it now looked "unlikely" to hit a target set of doubling its 2007 gross profit, of $4.3bn, by 2012.

The US-based company also said that its full-year earnings would, on an adjusted basis, come in at the low end of the $3.10-3.30 per share it had guided too.

The gloomier outlook reflected "intense competitive pressure" in both its seeds and sprays business, although especially in the market for glyphosphate herbicides, where Monsanto's Round-Up weedkiller has faced growing rivalry from white-label products.

Market reaction 

"Over the course of a five-year operational plan, the landscape can change," Hugh Grant, the Monsanto chairman and chief executive officer, said.

"While there may be options to make an accelerated push for 2012, it's clear to me that achieving that objective would involve making short-term choices that are not in the long-range interests of the business."

The statement initially sent Monsanto shares down nearly 4% to $67.25, their lowest since November, although they recovered some ground to close at $68.09, down 2.1% on the day.

Analysts expressed some reassurance that the company had not lowered its earnings forecasts for this year, and stood by a target of free cash flow hitting $0.9-1.0bn for the group's financial year, which ends in August.

Price cuts 

Sales growth in the seeds and genomics business, which ran at nearly 15% last year, slowed to 6.8% in the December-to-February period.

Net sales reached $3.25bn, led by corn, by far Monsanto's biggest seller. Farmers have planted some 3m acres of Genuity SmartStax corn, a variety genetically modified to tolerate herbicides and kill some insect pests.

The sprays division, named agricultural productivity, suffered a 35% fall to $993m in sales, with gross profit slumping 84% to $87m.

The fall reflected large stocks of generic glyphosphate products, and price cuts imposed to shift Round Up.

"These price decreases were central to the company's strategy of increasing global volume, which increased in several regions including Brazil, Argentina, Asia, and the US," Monsanto said.

Group earnings for the quarter fell by 18.7% to $887m, or $1.60 per share, in line with Wall Street forecasts.