Global crop protection product manufacturer and plant breeder Syngenta attributes a 15% fall in first half year profitability and 7% in revenues to poor spring weather in North America, as well as lower sales in Europe. The company has now completed two years under the ownership of ChemChina.
Extreme weather in North America “severely delayed” planting, with the overall crop areas down year on year. Seeds sales in Europe were reduced by “challenging” markets and problems with finance in Eastern Europe.
The company posted an EBITA of $1.46 billion on revenues of $6.77bn in the six months to June 30th 2019, compared to $1.71bn and $7.25bn in the first half of 2018. Group crop protection sales were 6% lower at $5.21bn and seed sales by 9% to $1.6bn.
Syngenta’s crop protection sales saw a 14% drop in North American to $1.4bn and were 9% lower in the Europe, Middle East and Africa (EMEA) region at $1.77bn. Asia Pacific sales were down 10% at $0.63bn. But these were partially offset by a 19% hike to $1.04bn in Latin America and a 4% lift to $0.2bn in China.
Seed sales fell 30% in North America to $0.43bn and were down by 9% in EMEA at $0.66bn. Overall corn and soybean revenues were 11% lower year-on-year at $0.75bn.
A strong start to the European crop protection market in Q1 as the early spring enabled an early start to fieldwork – especially after 2018’s late start – did not sustain into the second quarter. North America was hit by the very difficult weather there and Asia Pacific sales by drought conditions in Australia.
“The first half of this year saw many challenges for agriculture, including historic flooding in the US that resulted in significantly late planting and severe droughts in Australia and Indonesia,” says Syngenta chief executive Erik Fyrwald. “Growers continue to face challenges with trade issues. Adverse weather conditions were mostly offset by strong volume growth in Latin America.”