Shares in Syngenta tumbled to their lowest in nine months after the agrichemicals giant ditched hopes of a rise in full year profits, after a revival it had forecast for the April-to-June period fell short of expectations.

Mike Mack, the seeds and sprays group's chief executive, said that the company's operating income for the full year would match 2009 levels, with earnings, on a per share basis, dragged lower by a higher taxation rate.

The forecast represented a downgrade from an outlook released three months ago, when Syngenta, the world's biggest agrichemicals group, said its operating income would grow in 2010. The company began the year expecting higher earnings per share too.

Shares in the Swiss-based group slumped 8% to SFr222.00, their lowest since October, before recovering some ground to close at SFr229.30.

'Intense competition'

The downgrade followed a quarter which Syngenta had billed as a springboard to an improved performance, as farmers' spending on crop protection products recovered from a credit crunch hiatus.

However, while sales showed "solid" growth by volume, prices were depressed by a hangover of stocks left over from last year.

"High channel inventories… resulted in a competitive first half price environment," Syngenta said, singling out Canada, Mexico and the US markets as particularly tough.

"Price competition remained intense in certain segments," notably in glyphosates, where the group faces steep competition from Chinese generic chemicals groups, and fungicides.

Growth in group sales in the April-to-June period was limited to 1.3%, taking them to $6.74bn.

With costs swollen by investment in emerging markets, and in research and development of products, earnings fell by 10.7% to $1.26bn, below analyst forecasts of a $1.38bn result.

Latin America boost

The group said its growing stake in developing markets would help maintain the growth in volumes seen in the latest quarter.

"As we approach the main season in Latin America, we are assuming that the current favourable fundamentals will support further growth in our business there," Mr Mack said.