Strategic
forecasting is critical to both success and longevity in the
seed industry. The Context Network’s recently released Global
Seed Market Database (GSMD) proves just how strongly
advancements are driving seed marketplace value. GSMD architect
and Context Consultant, Mark Nelson said, “The total global
proprietary seed market sector value approached $20B in 2006.
That represents an increase of nearly 40% over 2001 marketplace
estimates.”
Drivers of Growth
Nelson said the GSMD provides industry executives with an
important tool to help valuate the marketplace and its
historical trends. “As we look forward, we forecast that the
field crops portion of the global seed sector will be $36B in
the year 2020, just over twice its 2006 valuation. That said,
we’ve looked at primary sources of the sectors’ growth;
biofuels’ impact on commodity prices which drive the potential
for price increases in base-genetics, additional crop area being
planted to biofuels crops such as corn in the US or rapeseed in
the EU, near-term expanded use and stacking of currently
commercialized traits, and the introduction of novel traits that
are expected to be rapidly adopted in the later years of the
forecast period. These four drivers of growth express themselves
differently across global market geographies, significantly
impacting the success of strategies presently being develop by
multinational participants in agricultural markets.”
Nelson added, “This is a robust outlook study that projects
Context’s proven sector valuation framework of eleven seed
market valuation variables in three outlook dimensions,
commercial area, seed expenditure and trait expenditure.”
Context is uniquely positioned to provide a clear and well
supported 10 year forecast on the seeds with traits marketplace.
Nelson noted, “The leveraging of Context’s companion syndicated
studies, GSMD 2007 and BTC Outlook, provide Context with a
valuation framework of the global seed market as well as an
extensive review of commercialized and ‘soon to be’
commercialized enhanced seed traits.”
Context has collaborated with Global Insight’s Long-Term
Forecast and Analysis for U.S. Agricultural and World Trade as
well as for the International Crop Sector, providing this seed
sector outlook with a widely recognized baseline of crop acreage
and commodity prices. “Collectively, these three elements, GSMD
2007, BTC Outlook and Global Insight’s Long-Term Forecast and
Analysis, provide the cornerstones for this study to incorporate
forecast analytics on seed expenditures, market transitions of
commercialization and/or hybridization, and grower adoption and
sector value creation of enhanced seed traits.”
Nelson
commented, “At Context, we believe that developing and clearly
articulating a 2020 vision for the global seeds sector requires
bold discourse and concise imagery that only come through
exposing our assumptions and modeling expected results.”
Context’s
tools to valuate the sector allow it to demonstrate a
comprehensive 2020 vision of seeds and traits, complete with
detailed growth assumptions by key market geographies and by
each major field crop. He added, “That provides executives with
a credible and cohesive possible future state to conceive the
operation of their businesses therein, allowing them to
challenge their own assumptions on the industry’s growth as well
as which crops and regions will provide primary and secondary
platforms for market expansion.”
The
Context Network provides business management and strategy
consulting services to the world’s leading agriculture,
biotechnology and food companies and government agencies and
institutions. Major areas of expertise include strategy, merger
and acquisition support, valuation of new technologies,
formation of alliances, and market research. The Des
Moines-based firm is composed of a core of professional
consultants that is complemented by a network of more than 100
industry and subject-area experts. |
