TOMEN AGRO HAS BIG PLANS FOR EXPANSION IN THE U.S.

Editor's Note: Dennis K. "Denny" Krass, Ph.D., is president of Tomen Agro Inc., a wholly owned subsidiary of Tomen Corp. Based in San Francisco, Tomen Agro markets Elevate[R] and Captan fungicides in the United States, along with Select[R], Orthene[R] and Monitor[R] internationally. Tomen Corp. and Nichimen Corp. recently announced that they will spin off their life science businesses and merge them into a new independent company headquartered in Tokyo. The yet-to-be-named entity and its affiliate companies will employ more than 1,500 people worldwide.

AM: With the recent consolidation in the crop protection industry, the number of manufacturers and distributors is shrinking. What marketing advantages does this give to Tomen Agro?

DK: At other companies, you'll often find a growth pattern that starts regionally and moves toward a global presence. Tomen Agro is different. We've done business on a global scale since we began. Now we have the opportunity and resources to also focus on specialty crops markets in the United States.

There's a definite need for high-quality crop protection products in the specialty sector of the ag market, but fewer companies will be willing or able to compete for this business in the future. By calling on our worldwide network of resources in manufacturing, shipping and communications, we're able to provide products to farmers at competitive prices -- regardless of the size of the market. And by conducting forward-looking research, we can anticipate changes in the market and develop the types of products specialty crop growers will need in the years to come.

AM: How will the spin-off and merger with Nichimen's life science unit impact Tomen Agro?

DK: We view this as a very positive move by our two companies. It provides the financial resources and global infrastructure for us to be much more aggressive in the acquisition and development of crop protection assets for the future, without compromising our strengths in the areas of product development, registration and marketing.

AM: In a few years, the EPA will phase out methyl bromide. What efforts are under way at Tomen Agro to find a replacement?

DK: Methyl bromide is a chemical fumigant applied prior to the planting of agricultural crops -- most notably, strawberries and tomatoes. It effectively controls a variety of soil-borne diseases, insects and weeds, and it is critical to ensuring abundant, high-quality crops.

To date, the most effective replacement for methyl bromide is a compound called iodomethane, under development by Tomen Agro. Early tests indicate that iodomethane is extremely effective against a broad spectrum of fungi, weeds and nematodes, giving it an edge over other proposed substitutes that control only one or two types of soil-borne pests.

Given the critical need to find a suitable replacement for methyl bromide, the EPA is expected to give iodomethane "fast track" approval status. So we hope to have it registered by the time methyl bromide exits the market in 2005.

AM: How do you plan to increase market share in the United States?

DK: Today, the United States accounts for about 40 percent of our overall sales volume. However, we have big plans for growth in this country as well as abroad.

In addition to iodomethane, we're currently in Stage 2 residue testing on a new miticide Tomen Agro licensed from Agro-Kanesho. We hope to have this new class of chemistry available to producers of pome fruit and citrus crops by early 2004, and we are optimistic that we will have approval for use on ornamentals by 2003. This product also looks very promising for use on strawberries and vegetable crops.

We've also acquired the NAFTA marketing rights for an advanced new contact insecticide. Our plans are to introduce this compound into the U.S. vegetable crops market as early as 2005. Finally, we recently announced a licensing agreement giving us the worldwide development, manufacturing and marketing rights to a new post-emergence corn and cereal grains herbicide.

AM: Flow will you market your products to growers?

DK: While some companies are exploring ways to sell directly to growers, Tomen Agro is committed to our current distribution network. That's because we believe distributors and dealers serve a vital role in educating growers about our products and their proper use. Furthermore, we believe most growers prefer to purchase their crop inputs from local, full-service outlets.