Luling $1B plant expansion to be decided Jan. 29
Monsanto Co. will lay off another 1,000 people to deal with a sluggish farming economy, but did not specify impact to its Luling site.
The agricultural giant outlined the layoffs as part of a cost-cutting measure in a Jan. 6 regulatory filing with the U.S. Securities and Exchange Commission (SEC). In the fall, Monsanto announced it was shedding 2,600 jobs, bringing total announced layoffs to 3,600 people or 16 percent of its global workforce.
Announced last year, Monsanto’s proposed $1 billion expansion of its Luling site to make dicamba, a herbicide, is still pending consideration by its board directors at its Jan. 29 annual meeting.
Company President and COO Brett Begermann commented on the company’s dicamba plans last Wednesday.
“We’ve also been progressing with our dicamba chemistry strategy and closed on multiple supply agreements,” Begermann said. “These agreements are expected to provide us with adequate supply of dicamba in the early years following launch and, together with our pending self-manufacturing plans, are expected to provide a balanced approach to cost-effective dicamba supply.”
In June, Begermann announced the potential expansion project pending a final decision by the company board in early 2016. If approved, the company planned to upgrade its Roundup Ready Xtend Crop System product line.
“We have a long and successful partnership with St. Charles Parish and Louisiana,” he said at the time of the announcement. “Our Luling facility is a logical site uniquely positioned at the center of Monsanto’s manufacturing network, with convenient access across the Americas where the Roundup Ready Xtend Crop System has a fit. The state’s highly skilled workforce and business-friendly environment also put Louisiana at the top of our list for this potential expansion.”
As of Aug. 31, Monsanto employed 645 people in Luling. Globally, the company employed about 22,500 people at more than 400 facilities worldwide in more than 60 countries as of October.
The company said the cuts are part of its broader cost-cutting measures that will continue through fiscal year 2018, varying country to country, including staff cuts, site closures and contract terminations.
On the potential for local layoffs, Monsanto spokeswoman Christi Dixon said, “It’s accurate to say that actions and reductions are taking place across a variety of functions/units globally.”
Monsanto is shuttering three research and development centers this year – Middleton, Wisc., and Mystic, Conn., and Research Triangle Park, N.C. In late October, some 90 employees were cut at research locations in North Carolina, Wisconsin and Connecticut, as well as relocated another 65 employees from those facilities to its Chesterfield research center.
Dixon said the reorganization plan will keep Monsanto viable.
“As we set the foundation for future growth, our company will continue to focus on disciplined operational spending as a hedge to the current industry macro environment, but more importantly to take proactive steps that will enable us to deliver on our long-term growth opportunities,” she said. “It is our firm belief that now is the time to be discussing transformational opportunities within our own operations, despite the current macro environment, as it is precisely in these times that strategic advancements can foster new growth opportunities.”
In June of last year, Monsanto announced plans to reduce operating costs by $300 million to $500 million by fiscal year 2018. In October, it announced initial plans called for savings of up to $300 million and laying off 2,600 employees.
By November, the company announced targeted savings of up to $500 million.
In a recent public 8-K filing with the SEC, Monsanto announced its board of directors approved the remainder of the plan, which includes continued implementation of its priorities along with cutting another 1,000 employees, bring to 3,600 the total positions cut, by fiscal year 2018.