04 June 1999
Banks-Cargill venture promises cheaper seed
By Vicky Houchin
BANKS Agriculture and Cargill plc are to create a new seed company in a joint venture which they claim will provide farmers with cheaper seed.
The new company, Newtech Processing Ltd, will process seed for the parent companies agricultural supply businesses.
It will have entirely independent status and will assume ownership of all the existing Cargill and Banks seed plants and operations in the UK.
Mark Aitchison, general manager of Cargills Agricultural Division, said that this development is designed to provide the latest technology and most competitive package to their customers by reducing costs and inefficiencies in both existing seed manufacturing operations.
Although Mr Aitchinson said that he cant predict what seed values will be this autumn, he hopes that a more streamlined operation will bring cheaper seed bills for growers.
“In future, the accuracy of processing will be very important. This decision is not just about this autumn but the future,” said Mr Aitchinson.
“We hope to provide the level of accuracy for that farmers are looking for.”
Approval has been given to jointly invest over £3 million in a new industry-leading seed plant in Bedfordshire in early 2000, and to further invest in the existing Swinderby and Newbury sites.
Cargills Turvey and Blandford seed processing plants will cease operations by autumn 1999 and Banks Sandy plant by early 2000. These will be incorporated into the Newtech facilities.
Mr Aitchinson stressed that the new company is an entirely independent subsidiary of the two parent companies and will be self-financing. The seed marketing activities will also remain independent.
“We will continue to supply our own customers with our own seed and brands,” said Mr Aitchinson.
Although the combined market share of the companies will match that of Dalgety – the countrys largest seed supplier – Cargill and Banks will continue to compete for seed sales on the farm.
Richard Banks, managing director of Banks Agriculture, added that the move would enhance both operations without altering their entirely different independent farm gate activities.