MONSANTO, BASF SCIENTISTS DISCLOSE DISCOVERY OF GENE CONFERRING DROUGHT TOLERANCE IN CORN PLANTS

Gene Provides Yield Stability During Periods of Inadequate Water Supply

ST. LOUIS and LUDWIGSHAFEN, Germany, June 9, 2009 – Monsanto Company (NYSE:MON) and BASF scientists unveiled the discovery that a naturally-occurring gene can help corn plants combat drought conditions and confer yield stability during periods of inadequate water supplies.

The companies stated that they will use the gene in their first-generation drought-tolerant corn product which is designed to provide yield stability to their farmer customers. This product will be the first biotechnology-derived drought-tolerant crop in the world.

The announcement comes at a time when recent studies, including one by the U.S. National Academy of Sciences, are warning of declining crop yields and global food shortages as a result of climate change. According to a United Nations’ Food and Agriculture Organization report prepared for ministers of the G-8, the number and duration of dry spells, especially in already drought-prone areas, is expected to increase.

The companies said that the drought-tolerant corn contains the cspB gene, from Bacillus subtilis. CspB codes for and is responsible for an RNA chaperone, which are commonly occurring protein molecules that bind to RNAs and facilitate their function. The gene was first identified in bacteria subjected to cold stress conditions and further research has demonstrated that cspB helps plants cope with drought stress. Monsanto scientists have published those findings in a peer-reviewed paper in the journal, Plant Physiology.

In corn, cspB works by helping the plant maintain growth and development during times of inadequate water supply. A corn plant is particularly vulnerable to drought during reproductive growth stages. By mitigating the impact of drought on the plant, cspB helps provide yield stability. Improved yield stability is of significant value to farmers faced with unpredictable rainfall.

“The development of this trait demonstrates the strength of our robust discovery engine which is fueled by our ongoing investment in R&D,” said Robert Fraley, Chief Technology Officer for Monsanto. “It also reflects our commitment to our farmer customers and a recognition of the investment they make in our products. Drought-tolerant corn will be another tool with which we can help them meet the challenges facing agriculture today.”

“BASF and Monsanto’s drought-tolerant corn is the first result of our plant biotechnology collaboration of which I am very proud,” said Jürgen Schweden, Senior Vice President R&D, BASF Plant Science. “With our complementing technologies, we are able to bring more and better products to farmers faster,” he added.

Monsanto and BASF noted that the drought-tolerant corn product is targeted for as early as 2012 pending appropriate regulatory approvals. Both companies also recently announced that they have completed regulatory submissions for cultivation in the United States and Canada, and for import to Mexico, the European Union and Colombia. Submissions in other import markets will follow in the months to come.

In any given year, 10 million to 13 million acres of farmland planted to corn in the United States may be affected by at least moderate drought. In field trials conducted last year in the Western Great Plains, drought-tolerant corn met or exceeded the 6 percent to 10 percent target yield enhancement – about 7 to 10 bushels per acre in some of the key drought-prone areas in the United States where average yields range from 70 to 130 bushels per acre.

Drought-tolerant corn technology is part of the R&D and commercialization collaboration in plant biotechnology between BASF and Monsanto, announced in March 2007. The two companies are jointly contributing $1.5 billion over the life of the collaboration, which is aimed at developing higher-yielding crops and crops more tolerant to adverse environmental conditions such as drought.

The first-generation product is part of a multi-generational family of biotech drought-tolerant products the companies plan to bring to market in the next decade. Both BASF and Monsanto continue to bolster the joint pipeline with other genes for drought tolerance as well as other abiotic stress tolerance traits. Among them is the second-generation drought-tolerant corn, currently in Phase 2 – which consists of laboratory and field testing.

Monsanto decided to collaborate with BASF because the company is excellently positioned to provide traits as a series of successive upgrades within a particular crop. For BASF, Monsanto's track record of commercializing traits and breeding desirable germplasm ensures that BASF's innovations quickly reach the widest base of farmers.

Monsanto’s discovery engine – to which the company contributes $2.6 million a day – continues to screen, evaluate and advance genes with promising yield and stress tolerance characteristics.

Monsanto’s discovery engine combines cutting-edge breeding and biotechnology research using elite germplasm from around the world to deliver the best seed-based solutions for increased on-farm productivity. Drought tolerance as well as other traits in development, such as higher-yielding soybeans and disease-resistant cotton are key to meeting the company’s Sustainable Yield Commitment. In 2008, Monsanto pledged to double yields in its three core crops – corn, cotton and soybeans – by 2030 compared to a base year of 2000 – while also working to conserve resources such as water, land and energy, required to produce each unit.

About Monsanto Company

Monsanto Company is a leading global provider of technology-based solutions and agricultural products that improve farm productivity and food quality. Monsanto remains focused on enabling both small-holder and large-scale farmers to produce more from their land while conserving more of our world's natural resources such as water and energy. To learn more about our business and our commitments, please visit: www.monsanto.com.

About BASF

BASF is the world’s leading chemical company: The Chemical Company. Its portfolio ranges from chemicals, plastics and performance products to agricultural products, fine chemicals as well as oil and gas. As a reliable partner BASF helps its customers in virtually all industries to be more successful. With its high-value products and intelligent solutions, BASF plays an important role in finding answers to global challenges such as climate protection, energy efficiency, nutrition and mobility. BASF posted sales of more than €62 billion in 2008 and had approximately 97,000 employees as of the end of the year. BASF shares are traded on the stock exchanges in Frankfurt (BAS), London (BFA) and Zurich (AN). Further information on BASF is available on the Internet at www.basf.com.

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