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Record US soybean sowings lift DuPont profits

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Seed and chemical giant DuPont reported rising profits and sales, supported by heavy US planting intentions for this spring, although a shift from corn to soybeans will delay some sales, the company said.

DuPont reported operating profits over the three months to March 31 at $1.43bn, up 29% year on year.

Profits equated to $1.64 a share, beating analyst expectations of $1.39.

Sales rose 4.6% over the period, to $7.74bn, beating estimates of $7.50bn.

Rising seed sales

The higher profits was driven by rising returns from DuPont's agriculture segment, which were up 12% year-on-year, to $1.24bn, as seed sales rose 4%.

DuPont's seed earnings rose thanks to higher prices and volumes in the United States, after the company shifted away from marketing its products via distributors, to selling directly to farmers.

This shift in marketing resulted in some seed sales being delayed from last year, into the current one.

Shift from corn to soy

Seed demand is expected to be supported by record soybean acreage in the United States over the first half of 2017, DuPont's executive vice president of agriculture James Collins told investors.

"We expect sales to increase by mid-single digits percent," Mr Collins said.

"Top line growth will be driven by pricing gains realized by our new product introductions and volume growth across our soybean, sunflower, and insecticide portfolios."

"Seed volumes will benefit from the timing of seed deliveries but will be partially offset by expected declines in corn acreage in North America," Mr Collins said.

The shift from corn to soybeans weighed on first quarter sales volumes, Mr Collins said. Soybeans are sown later than corn in the US.

By Agrimoney.com

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