German drug and chemicals giant Bayer AG has made an unsolicited takeover offer for Monsanto Co, the world's biggest seed company, as high inventories and low commodity prices spur consolidation in the global agrichemicals industry.

Monsanto disclosed the approach on Wednesday before Bayer confirmed its move, though neither released proposed deal terms.

With Monsanto worth $42 billion by market capitalization, an acquisition would likely be bigger than ChemChina's February deal to buy Swiss agrichemicals firm Syngenta AG for $43 billion - a target Monsanto itself pursued last year - and could face U.S. antitrust hurdles.

Monsanto said in a statement its board is reviewing the proposal, which is subject to due diligence, regulatory approvals and other conditions. There is no assurance that any transaction will take place, it said.

Bayer, which has a market value of $90 billion, said in a brief statement that its executives recently met executives of Monsanto to privately discuss a negotiated acquisition. A further statement will be made as appropriate, it said.

The proposal comes as Chinese state-backed ChemChina's deal for Syngenta faces intensive regulatory review in the United States over concerns about the security of U.S. food supply. The deal is the largest foreign acquisition ever by a Chinese company, as Beijing seeks to secure the country's own food supply.

Any deal between Bayer and Monsanto, meanwhile, could raise U.S. antitrust concerns because of the overlap in the seeds business, particularly in soybeans, cotton and canola, antitrust experts have said.

However, spurning a deal with Bayer over concerns a tie-up might not receive antitrust clearance could also pose challenges for Monsanto - its own bid for Syngenta last year would have meant significant expansion in seeds.

Bayer, the inventor of aspirin and maker of Yasmin birth control pills, is a much more diversified company than Syngenta or Monsanto, with a major life sciences business. Bayer's crop science division has businesses in seeds, crop protection and non-agricultural pest control, potentially complementing Monsanto's seeds assets.

Monsanto approached Bayer earlier this year to express interest in the latter's crop science unit, in the form of an acquisition or joint venture, sources told Reuters in March.

Bayer is ranked No. 2 in crop chemicals, with an 18 percent market share, according to industry data. The largest, Syngenta, has a 19 percent share.

Monsanto is the leader in seeds, with a 26 percent market share, followed by DuPont, with 21 percent. DuPont agreed last year to merge with Dow Chemical.

http://www.reuters.com/article/us-monsanto-m-a-bayer-idUSKCN0YA054

By now, almost anyone can pick the world’s biggest polluters out of a lineup: power plants, automobile tailpipes and factories. Together they push nearly 70 percent of heat trapping greenhouse gases into the atmosphere. Not surprisingly, the trio drew considerable attention during the late 2015 Paris climate talks to limit global warming to 2 degrees Celsius, or 3.5 degrees Fahrenheit, by the end of the century.

But a new study released Tuesday says the agreement reached by governments after the United Nations talks will fail if they fail to confront another major source of greenhouse gas emissions: agriculture. Based on some estimates, meat, dairy and crop production emit as much greenhouse gas pollution in the form of methane and nitrous oxide as automobiles emit carbon. The study said farm emissions must fall by a billion tons per year by 2030.

According to the study, current regulations for agriculture will fall up to 5 percent short of what’s needed. “This research is a reality check,” said Eva Wollenberg, leader of the CCAFS Low Emissions Development research program at the University of Vermont’s Gund Institute for Ecological Economics. “Countries want to take action on agriculture, but the options currently on offer won’t make the dent in emissions needed to meet the global targets agreed to in Paris.”

The U.N.’s current solutions call for more water efficiency in rice production, better forestry practices and lowering food waste. But the study’s authors said governments will have to do better than that. The study advocates identifying specific breeds of cattle that produce less methane, along with a dietary inhibitor that reduce the gas by more than 25 percent.

The study, two years in the making, was published in the journal Global Change Biology. Its more than 20 authors represent research institutions from around the world, including the International Livestock Research Institute in Nairobi, the French National Institute for Agricultural Research in Paris, the International Rice Research Institute in Los Baños, Philippines, and the International Institute for Tropical Agriculture in Cali, Colombia.

https://www.washingtonpost.com/news/energy-environment/wp/2016/05/18/greenhouse-gas-emissions-from-this-surprising-source-could-doom-the-paris-climate-accord-goal/?utm_source=twitterfeed&utm_medium=twitter

Israel Chemicals (ICL) on Wednesday reported a 50 percent drop in first-quarter earnings due to a fall in fertiliser sales and said it would cut its dividend payout ratio because of weakness in agricultural markets.

"Our board has adjusted the company's dividend policy to strengthen ICL's financial position amid the volatile situation we are facing in the agricultural commodities market," Chief Executive Stefan Borgas said.

The company said prices of agricultural commodities fell during the first months of 2016, weighing heavily on farmers' decisions on how much fertiliser to buy.

Last month, the world's biggest fertiliser company producer by capacity Potash Corp cut its full-year 2016 profit forecast due to lower demand and weak prices.

ICL, which has exclusive permits in Israel to extract minerals from the Dead Sea, earned 7 cents per diluted share, excluding one-time items, in the first quarter, down from 15 cents a year earlier. Sales fell to $1.27 billion from $1.4 billion, mainly due to a drop in potash prices and sales volumes.

ICL, one of the three largest suppliers of crop nutrient potash to China, India and Europe, was forecast to make adjusted earnings of 9 cents on sales of $1.3 billion, according to Thomson Reuters I/B/E/S.

The sale of non-core businesses and the weaker euro and pound against the dollar also hit revenue.

The potash market, in particular, has been hurt by the delay of 2016 contracts with China, usually a trigger for other markets and which sets a price benchmark for the year, ICL said. Weak sales to China and India also hit potash profit margins.

Potash sales in the quarter fell to 917,000 tonnes, including Israel, from 1.14 million a year earlier.

Borgas said the company was taking steps to strengthen its phosphates joint venture in China, which was affected by weaker domestic demand and lower prices. ICL will step up efficiency measures to cut the joint venture's staff numbers and set up a marketing division in China to improve sales.

For 2016 and 2017, ICL's dividend payout ratio will comprise up to 50 percent of its adjusted annual net income, compared with a prior policy of up to 70 percent.

ICL will pay a dividend of 3 cents a share, or a total of $35 million, for the quarter.

Shares in ICL, a subsidiary of Israel Corp, fell 2.8 percent to 15.78 shekels.

http://www.reuters.com/article/icl-results-idUSL5N18F2ZS

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