The seed market is a very small segment, with global annual revenue of only about a billion dollars.
Moreover, this field is relatively mature, with the compound growth rate of the market size over the years being only 0.2%.
Compared with the semiconductor and new energy industries, development is very slow.
Of course, the sudden emergence of Huaguo Seed Industry Group in 2022 will lead to an increase in the size of the entire seed market by about 13%.
A large amount of sea rice is grown on a large scale in China, the Middle East, Southeast Asia and other places. This part is a new market size.
Previously, sea rice only stayed in the laboratory and has not been promoted on a large scale.
In this field, the gap between Huaguo and American is not big. In 2019, American and Huaguo were the top two in the seed industry market, with corresponding market shares of 26.7% and 21.2%.
However, gross profit margins vary greatly. Most Chinese companies' gross profit margins fluctuate around 20%, and some even have gross profit margins of only 10% for some listed companies.
The gross profit margin of European and American seed industry giants such as Monsanto is 60%.
Due to the huge gap in profits, European and American multinational giants have more funds to invest in research and development, and their industrial advantages are also greater.
Take the Huaguo Seed Company with a gross profit margin of 10% as an example. Their net assets are about 1.7 billion yuan and their net profit is negative 7 million yuan. The government has given them a total of about 8.5 million yuan in 2021. subsidy.
How much can a company like this invest in R&D? The annual research and development expenses are only 27 million yuan, and the management expenses are 71 million yuan.
The same is true in many subdivisions. Europe and the United States occupy the upstream of the industrial chain, have formed industrial advantages, and have the power to price international trade.
If China wants to climb up the industrial chain, it will take time, capital investment, and R&D investment.
Most countries are unable to cross the middle-income trap precisely because they do not have the ability and determination to climb up the industrial chain.
Europe and the United States, by virtue of occupying the upper reaches of the industrial chain in vast subdivisions, enjoy high profit margins and can support a relatively wealthy and less stressful life.
(I’m sorry that I couldn’t help but say too much. Since the country’s No. 1 document this year outlines the development of agriculture, in line with the attitude that investors need to be responsible for their own money, I have posted the financial reports of listed companies related to the seed industry in the past few days. Picked it up again.
R&D investment is very low. Some listed seed companies have a market value of 3 billion, but their annual R&D investment is only 8 million. Better, a market value of 20 billion and R&D expenses of 40 million.
I see that the highest R&D investment is about 110 million RMB.
Monsanto’s R&D investment ten years ago was about 1.5 billion yuan.
Very pessimistic)
Syngenta has lost a lot of its market share.
Huaguo Seed Industry Group not only occupied the market share of these European and American seed industry companies, but also opened up many new markets.
The most important thing is that they seem to have developed a new way of breeding genetically modified seeds.
So they are eager to get a piece of the pie.
After internal discussions, Chen Jingrui handed over some seed cultivation work to Syngenta, and Syngenta sold it in the Europa region. This is feasible.
After all, Huaguo Seed Industry controls Syngenta.
However, Syngenta wants to participate in the research and development work of Huaguo Seed Industry Group, which they have no decision-making power.
Because of the research institute, Huaguo Seed Industry Group cannot interfere at all.
Syngenta is going through a very difficult time, and Monsanto is having an even worse time. It has been unable to find a countermeasure, and Grant's position as president is crumbling.
Monsanto's shareholders were increasingly dissatisfied with him, and Grant was under tremendous pressure. He could only pass the pressure on to his subordinates:
"Forelli, it's been almost a year since China launched its super soybeans. Why haven't we found the secret behind their rapid development?"
"Not only that, the Chinese have also introduced a series of seeds such as rice, wheat, corn, cotton, etc. that are better than all products on the market."
"Our market share this year has dropped by at least 50 percent compared to last year!"
Specific data has not been released yet.
Forelli originally had to argue every time and find various excuses to delay time.
Because Grant wanted to lay off some researchers and reduce the scale of research, but Forelli was unwilling. He wanted to fight for the interests of his subordinates.
Monsanto's annual R&D investment is 10% of its operating income. This year's decline in operating income means that R&D investment will also drop significantly. In this case, the only option is to lay off employees.
But this time Forelli did not refute, instead of promising that he would be able to find out the reason if he gave himself some time, he was dejected:
"Grant, do you know the paper on the existence of the soul that was recently published in Science?"
Grant nodded and said: "Look, isn't that the detailed version of Merlin's paper published in the Internet? Even the name is a variant of Merlin, what's so strange about it?"
"We should all know. There is even a team in the laboratory that specializes in soul research."
Yes, Monsanto wanted to try to see if they could develop magic plants, so they set up a dedicated soul research team.
Trying to grow plants using souls as materials.
It's just that they have made some progress in this area. A large number of souls fill the air, and the cultivated plants will show very weak characteristics, so weak that you can't tell whether it is a change brought about by the soul.
There is still a long way to go before cultivating real magic materials.
And because intelligent organisms are used as materials, the price of intelligent life has been rising steadily in the past two years.
When Zheng Li was still in the Lion City, the price of an experimental monkey was 300,000 RMB. Now the price has increased to one million RMB.
So much so that monkeys in Mount Emei are frequently poached.
Monkeys have become a resource that is even crazier than the rise in lithium mines.
This was something Zheng Li didn't expect. Now that he wanted to conduct experiments and buy experimental monkeys, it would cost a lot of money.
The price of experimental monkeys has been rising, causing domestic biopharmaceutical companies to increase their research and development costs a lot.
Coupled with the special medicine developed by American, Gulen's fund has been falling all the way. It can be said that there is a bottom below the bottom, and there is no bottom.
A lot of novices chasing star fund managers are losing money.
Forelli nodded and said: "Yes, according to the information I got from a friend, China is combining magic and breeding."
"So this year they have an endless supply of high-quality genetically modified seeds."
"This is a completely different system from our genetically modified breeding network, and we can't learn from it at all."
"You should have a deep understanding of the difficulty of obtaining the Demonic Brain. This is not something Monsanto can study."
Regarding Magic Brain and Magic Coin, many large companies want to do it, but if they really make up their mind, the returns they will get from investing huge amounts of money are completely unknown.
No one can give a rough idea of what the Demonic Brain is. Therefore, many large companies have chosen to give up.
