Bayer Unit Makes More Investments to Curb Synthetic Fertilizers
(Bloomberg) -- Bayer AG just made its second investment in as many months in startups working to curb the use of synthetic fertilizers, a step that would help the agricultural industry -- a major polluter -- become more environmentally friendly.
The industry giant, which owns agrochemical and biotechnology company Monsanto Co., said Tuesday one of its units co-lead a $15 million investment in Andes, a startup that treats seeds so plants can better draw nitrogen from the air instead of needing energy-intense synthetic fertilizers. Synthetic nitrogen fertilizers require huge amounts of energy to produce and account for 3% of global greenhouse emissions, Bayer said.
“When you think on the broad impact of synthetic nitrogen, it’s something that if we have an alternative and we can replace it, we should,” Gonzalo Fuenzalida, chief executive officer of Emeryville, California-based Andes, said in an interview.
The investment, while a drop in the bucket for a giant conglomerate like Bayer, points to a larger trend across agriculture: the push to become more sustainable without sacrificing yields or profits. Last month, the same impact investment arm, Leaps by Bayer, signaled its intentions in this space by leading a $45 million round for a different startup also promising to tackle the fertilizer problem. Bayer also has a joint venture with synthetic biology innovator Ginkgo Bioworks working on the issue.
Climate activists have been pushing for years to reduce fertilizer use or change the way it’s produced. But trade in global nitrogen is big business for companies like Nutrien Ltd and CF Industries Holdings Inc. Global nitrogen imports were valued at $22.9 billion in 2020, according to Bloomberg Intelligence and Trade Data Monitor.
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