Basel, Switzerland-based agricultural products company Syngenta AG (SYT - Free Report) announced an agreement with Cellulosic Ethanol Technologies, LLC — a subsidiary of Quad County Corn Processors. The agreement allows Syngenta to use the latter’s Adding Cellulosic Ethanol (ACE) technology — a new process for ethanol plants.
ACE technology is considered apt for increasing the plant’s ethanol production and increasing corn oil production and ensuring higher protein content in Dried Distillers Grains. The technology, when combined with Syngenta’s Enogen corn trait, will enable the starch and the fiber in a corn kernel to be converted into ethanol.
Corn sales are a major revenue driver for Syngenta. Corn sales represented roughly one fourth of the company’s total revenue in 2013. The deal is expected to strengthen the company’s foothold in the corn market.
Syngenta has been attempting to gain market share through acquisitions and product launches. Recently, the company announced the acquisition of Italian durum wheat seed company Società Produttori Sementi.
Apart from durum wheat seed, Società Produttori Sementi also deals with common wheat and alfalfa. The durum wheat is grown in over 330,000 hectares of land in Bologna. The deal will enable farmers in Italy and other countries to fulfill the increasing demand for pasta which has a global market worth $16 billion. The acquisition is expected to significantly boost Syngenta’s revenues in the upcoming quarters.
With a market capitalization of $34.9 billion, Syngenta currently holds a Zacks Rank #3 (Hold). Some better-ranked stocks in the industry include The Andersons, Inc. (ANDE - Free Report) , Gruma S.A.B. de CV and CVR Partners, LP (UAN - Free Report) . All these stocks carry a Zacks Rank #2 (Buy).
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