Benefit to Growers - Investor Relations Solutions

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Benefit to Growers - Investor Relations Solutions
Paul Schickler
President
DuPont Pioneer
1
Regulation G
The attached charts include company information that does not conform to generally accepted accounting principles
(GAAP). Management believes that an analysis of this data is meaningful to investors because it provides insight with
respect to ongoing operating results of the company and allows investors to better evaluate the financial results of the
company. These measures should not be viewed as an alternative to GAAP measures of performance. Furthermore,
these measures may not be consistent with similar measures provided by other companies. This data should be read in
conjunction with previously published company reports on Forms 10-K, 10-Q, and 8-K. These reports, along with
reconciliations on non-GAAP measures to GAAP are available on the Investor Center of www.dupont.com under Key
Financials & Filings in “Yearly Supplemental Financial Data and Non-GAAP Reconciliations”.
Forward Looking Statements
During the course of this presentation we may make forward-looking statements or provide forward-looking
information. All statements that address expectations or projections about the future are forward-looking statements.
Some of these statements include words such as “plans,” “expects,” “will,” “anticipates,” "believes," “intends,” and
“estimates.” Although they reflect our current expectations, these statements are not guarantees of future
performance, but involve a number of risks, uncertainties, and assumptions. Some of which include: fluctuations in
energy and raw material prices; failure to develop and market new products and optimally manage product life cycles;
global economic and capital markets conditions; litigation and environmental matters; changes in laws and regulations
or political conditions; business or supply disruptions; ability to protect and enforce the company’s intellectual property
rights successful integration of acquired business and separation of underperforming or non-strategic assets; and
successful completion of the proposed spinoff of the Performance Chemicals segment including ability to fully realize
the expected benefits of the proposed spinoff. The company does not undertake to update any forward-looking
statements as a result of future developments or new information.
Developing Markets
Total developing markets is comprised of Developing Asia, Developing Europe, Middle East & Africa, and Latin America.
A detailed list of all developing countries is available on the Earnings News Release link on the Investor Center website
at www.dupont.com.
2
2
Three Strategic Priorities To Increase The Value Of DuPont…
Ag & Nutrition
1. Extend our
leadership across the
high-value, sciencedriven segments of the
Ag and Food value chain
Industrial
Biosciences
2. Develop worldleading industrial
biotechnology
capabilities to create
transformational new
bio-based businesses
Advanced
Materials
3. Strengthen and
grow our leading position
in differentiated highvalue materials and
leverage new sciences
Higher Growth, Higher Value Company By
The
Value
Of DuPont Positions
Building AndIncreasing
Leveraging
Three
World-Leading
3
…In Conjunction With Three Operational Priorities
Innovation
•
Rigorous pipeline
management
•
Disciplined project
execution
•
Increasing return on R&D
Global Reach
Driving penetration in fastgrowing, developing
markets
Execution
•
Delivering ongoing
productivity
•
Optimizing resource
allocation
•
Returning cash to
shareholders
4
Population, Urbanization and Income Growth in the Developing
World will Continue to Drive Demand
Emerging Middle Class (Billions)
Percent Urban Population
90%
4.88
80%
0.65
70%
0.32
0.68
3.25
60%
3B
0.48
50%
0.33
1.85
40%
30%
20%
1970
1985
2000
2015
2030
2045
World
Africa
Asia
Europe
Latin America
North America
Other
North America
0.32
0.34
Europe
0.66
Asia-Pacific
0.53
2009
1+B
0.70
3.23
1.74
2020
2030
Ag Productivity and Nutrition Solutions are Critical to Feeding the World
Data Source: United Nations and OECD
5
DuPont Delivers Productivity and Profitability for Growers and
Food Companies in Ag & Nutrition
Ag Productivity
Nutrition Solutions
• Integrated seed solutions
• Germplasm / traits
• Seed-applied technologies
• Crop protection
• Decision services
• Specialty ingredients (enzymes
cultures, probiotics, soy protein,
emulsifiers, texturants, etc.)
• Animal nutrition
Bio-based Industrials
• Biofuels, biomaterials and
biochemicals
• Enzymes
Food Protection / Packaging
Solutions
• Antimicrobials, antioxidants,
diagnostics
• Specialty packaging resins
(sealants, adhesives)
DuPont holistically addresses the challenge of feeding the world
•
•
•
Improving agricultural productivity and animal feed efficiencies
Enhancing the nutritional value of food
Protecting food and reducing waste
Unique Capabilities Across the Ag and Food Value Chain
6
Continuing Growth in Agriculture
Innovative Products and Services
Genetic
Improvement
Optimum® AcreMax®
Optimum® AQUAmax®
Plenish®
DP4114
Canola HT*
Rynaxypyr®
Cyazypyr®
Fungicides
Lumigen™
Seed Sense
EncircaSM
Services
Next Gen Soy
Hybrid Rice
Hybrid Wheat
Extending our Global Reach
Brazil
Eastern
Europe
Western
Canada
India
China
Africa
Long-Term Growth Targets: Sales 8-10% CAGR with 22-24% Margins
*Optimum® GLY Herbicide Tolerance and LibertyLink® Herbicide Tolerance for canola
7
Innovation - EncircaSM Services
Built on a Legacy of Leadership and Innovation
• Industry’s largest professional ag advisory network
• Mapped 20 million+ harvested and as-planted
acres; implemented 1.5 million VRS prescriptions;
conducted 6K+ on-farm research trials*
• Deep analytic capabilities to offer predictive insights
Key Marketplace Differentiators
• Tailored solutions offered through Certified Services
Agents
• Brand-neutral services that put growers first
• Whole-farm approach
• Leveraging advantaged route-to-market
• Powered by industry leading collaborations and
enabling technologies
Addressing the most critical challenges
PROFITABILITY
RISK MANAGEMENT
SUSTAINABILITY
CONVENIENCE
Helping growers unlock the full potential of their land
*2013 growing season
8
Innovation - EncircaSM Services
EncircaSM View – Available now
Basic Package – Automatically geo-locate, organize
field by field, and share crop observations
through mobile device; industry-first Community
View provides real-time aggregated insight into
local crop conditions and soil moisture ratings
Premium Package – Market news and analysis,
innovative grain trading capabilities, and field
specific weather forecasts informed by individual
weather stations, powered by DTN/The
Progressive Farmer*
EncircaSM Yield – Available beginning in Q3
Assessment, planning & analysis of critical inputs
based on Environmental Response Units – seed,
nitrogen/fertility, water; real-time monitoring and
tailored solutions based on individual data
Additional Platforms & Offerings – Launching 2015+
Estimated peak revenue in next decade >$500M annually
* DTN/The Progressive Farmer, The Progressive Farmer, and DTN are registered trademarks and the property of DTN.
9
Innovation – Global Science, Local Solutions
•
•
•
•
•
Customer focused product development
Elite genetics and native traits
Biotech traits
Seed-applied technologies
Local product advancement places the
right product on the right acre
• Collaboration
Integrated Solutions for Local Needs
10
Optimum® Leptra™ Insect Protection^
Multiple modes of action against above-ground lepidopteran pests
Benefit to Growers
• Maximize overall farm yield by protecting yield
potential of our superior genetics
• Provides multiple modes of action for aboveground lepidopteran pests
• Herculex® I trait
• YieldGard® Corn Borer trait
• Agrisure Viptera® trait
• Offer industry leading protection against corn
earworm, fall armyworm, southwestern corn
borer, and sugar cane borer
• Enhanced trait durability
Status:
Launch
Primary Market:
Latin America, North America
Protection against above-ground
lepidopteran pests
Optimum® Leptra™ hybrid
Control hybrid
Grower Benefits: Maximized farm yields | Technology preservation
11
Lepidopteran/Coleopteran Protection DP 4114
High yield potential with proven above- and below-ground
insect protection
Benefit to Growers
• DP 4114 is a molecular stack of the proven Bt proteins
Status:
Phase 4, Pre-Launch
Primary Market:
North America
Event DP 4114 Providing Strong Efficacy and
Agronomics
from the Herculex® 1 and Herculex® RW traits
• Simplifies breeding efforts to maximize the potential of
our industry-leading genetics
• Will be stacked with other insect protection traits for
dual-modes of action above- and below-ground
• Enables additional corn rootworm pyramid product
options with enhanced yield performance and strong
agronomics
• In pre-launch phase, expected availability early in
second half of the decade
Lepidopteran/Coleopteran Protection DP 4114
research plot
Grower Benefits : Simplified Refuge | Enhanced Yield Performance
12
Innovation - 2014 Corn Seed Pipeline
Phased growth:
• Near to mid-term insect protection
solutions, backed by differential
breeding and seed treatment
• Discovery biotech investment
focused on agronomics and insect
protection
Differential breeding solutions:
• Expansion of Optimum®
AQUAmax® hybrids to new regions
• New market opportunity through
Ultra-Early corn
• Resistance to regional fungal, viral
and bacterial diseases, such as:
• Northern leaf blight
• Phaeosophaeria leaf spot
VALUE
Primary () &
Opportunity Market
PROGRAM
NA EU
LA
AP
AF
R&D Phase1
D
1
2
3
4 L
Estimated
Peak
Sales2
Market
Opp.
(MM
Acres)3
H
<50
H
50-100
-
>100
HIGHLIGHTED PRODUCT CONCEPTS
Optimum® Leptra™ hybrids^

Lepidopteran/Coleopteran Protection
DP4114


Launched
BIOTECH SOLUTIONS
New MOA Lepidopteran Protection III




New MOA Coleopteran
Protection III

-
50-100
Drought Tolerance II

-
50-100
Nitrogen Use Efficiency

-
50-100
Multiple Mode Herbicide Tolerance

-
50-100
H
>100
DIFFERENTIAL BREEDING SOLUTIONS
Continual Germplasm & Native Trait
Improvements





>>>>>>>>>
(1) R&D Phase: D=Discovery, 1=Proof of Concept, 2=Early Development, 3=Advanced Development, 4=Pre-Launch, Launch=Available for commercial sale or use. Products, concepts, or
benefits described herein will not be offered for sale or distribution until completion of field testing and applicable regulatory reviews. Each Phase represents only the lead event for each
program. Discovery and market evaluation is an ongoing process for all traits and programs in the pipeline. (2) Estimated peak sales range provided for projects Phase 3 or later in
pipeline: L= $0-100MM, M= $100-500MM, H= $500MM+ (3) Market Opportunity reflects estimated total acres in Primary Markets in millions. □ Indicates advancement or addition (2/132/14).
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Plenish®
Status:
Limited Launch
Primary Market:
North America
High Oleic Soybeans^
Biotech soybeans with consumer benefits
Soybean Oil Comparison
Benefit to Growers
• Highest oleic content in soy (heart-healthy
monounsaturated fat)
• Soy-based solution with 20% less saturated fat
than commodity soybean oil
• Enhanced functionality for food preparation
• Industrial application benefits
• Yields on par with
commercial varieties
Pioneer®
brand elite
Research Results
Bu/Acre
60
50
40
Plenish® High Oleic
Soybeans
Pioneer® brand Elite
Soybeans
57.1
57.4
30
20
10
0
Grower Benefits : Increased Value/Acre | Expanded Soy Markets
.
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Multiple Mode Herbicide Tolerance
Flexible, broad-spectrum weed control options for soybeans
Benefit to Growers
• Superior soybean genetics, combined with
multiple mode herbicide tolerance trait options
• Broad-spectrum weed control and application
flexibility
• Technologies in the pipeline build on Pioneer
herbicide tolerance trait offering
•
•
•
•
Status:
• Next gen SU tolerance: Phase 4, Pre-Launch
• Roundup Ready 2 Xtend™ technology: Phase 3,
Advanced Development
• Enlist™ technology: Phase 3, Advanced
Development
Primary Market:
• North America, Latin America
• Roundup Ready 2 Xtend™: North America
Rapid integration of Roundup Ready 2 Xtend™ into
Pioneer germplasm
Roundup Ready 2 Xtend™ technology
Enlist™ technology
Next generation sulfonylurea (SU) tolerance
Accelerated trait integration and Accelerated
Yield Technology (AYT™ system) to quickly
incorporate these new technologies into
Pioneer germplasm
Grower Benefits: Flexibility | Convenience | Weed Resistance Management
15
Innovation - 2014 Soybean Seed Pipeline
Phased growth:
• Near to mid-term increased end use
value and herbicide tolerance trait
options:
• Roundup Ready 2 Xtend™ trait
• Enlist™ trait
• Next gen sulfonylurea tolerance
• Discovery biotech investment for
enhanced end-use value and key
tropical pests
Differential breeding solutions:
• Protection against aphids
• Resistance to regional disease
targets, such as stacked
phytophthora or Asian soybean rust
VALUE
Primary () &
Opportunity Market
PROGRAM
NA EU
LA
AP
AF
L
Estimated
Peak
Sales2
Market
Opp.
(MM
Acres)3
L
M
<50
H
>100
R&D Phase1
D
1
2
3
4
HIGHLIGHTED PRODUCT CONCEPTS
Plenish® High Oleic Soybeans^

Multiple Mode Herbicide Tolerance




-
50-100
Lepidopteran Protection

-
50-100
Hemiptera Protection

-
50-100
Asian Soybean Rust Resistance

-
50-100
H
>100
Advanced
BIOTECH SOLUTIONS
Increased Oil & Improved Feed
Efficiency
DIFFERENTIAL BREEDING SOLUTIONS
Continual Germplasm & Native Trait
Improvements


>>>>>>>>>
(1) R&D Phase: D=Discovery, 1=Proof of Concept, 2=Early Development, 3=Advanced Development, 4=Pre-Launch, Launch=Available for commercial sale or use. Products, concepts, or
benefits described herein will not be offered for sale or distribution until completion of field testing and applicable regulatory reviews. Each Phase represents only the lead event for each
program. Discovery and market evaluation is an ongoing process for all traits and programs in the pipeline. (2) Estimated peak sales range provided for projects Phase 3 or later in
pipeline: L= $0-100MM, M= $100-500MM, H= $500MM+ (3) Market Opportunity reflects estimated total acres in Primary Markets in millions. □ Indicates advancement or addition (2/132/14).
16
Herbicide Tolerance – Canola
Options for broad-spectrum post-emergent weed control
Benefit to Growers
• Optimum® GLY Herbicide Tolerant Canola, developed
Status:
Optimum® GLY Trait: Phase 4, Pre-Launch
LibertyLink® Trait: Phase 4, Pre-Launch
Primary Market:
North America, Asia Pacific
Market Opportunity: NA Canola
8.5 million planted hectares 2013/14 essentially
100% herbicide tolerant
through proprietary gene shuffling technology, expected
to provide growers increased application flexibility
•
Optimum® GLY hybrids demonstrate competitive yield
performance
•
Provide options for rotational herbicide offering and
broad-spectrum post-emergent weed control
•
•
•
Optimum® GLY Canola and canola with the LibertyLink®
trait would be offered in combination with Pioneer
Protector® traits that provide defense against damaging
diseases such as Sclerotinia and Clubroot
Complements current herbicide tolerant offerings
including Clearfield® herbicide
In pre-launch phase, expected availability early in
second half of the decade
CL
5%
Gly
50%
LL
45%
Grower Benefits: Harvestable Yield | Weed Control | Flexibility
17
Innovation - 2014 Other Crops Seed Pipeline
Phased growth:
• Near to mid-term herbicide
tolerant options in canola, backed
by differential breeding across
crops
• Discovery biotech investment to
create new value in large acre
opportunity crops
Differential breeding solutions:
• Resistance to regional disease
targets across crops, such as:
• Canola - Stacked sclerotinia +
clubroot resistance
• Rice - Bacterial leaf blight
resistance
• Sunflower - Next gen
broomrape resistance
VALUE
PROGRAM
Primary () &
Opportunity Market
NA EU
LA
AP
AF
R&D Phase1
D
1
2
3
4
L
Estimated
Peak
Sales2
Market
Opp.
(MM
Acres)3
M
<50
M
<50
CANOLA
Optimum® GLY Herbicide Tolerance

LibertyLink® Herbicide Tolerance


RICE
Hybrid Rice Technology II

-
<50
Dual Mode of Action Lepidopteran
Protection

-
<50
Herbicide Tolerance

-
<50
-
<50
H
>100
WHEAT
Hybrid Wheat Technology

DIFFERENTIAL BREEDING SOLUTIONS
All Crops - Continual Germplasm &
Native Trait Improvements



>>>>>>>>>
(1) R&D Phase: D=Discovery, 1=Proof of Concept, 2=Early Development, 3=Advanced Development, 4=Pre-Launch, Launch=Available for commercial sale or use. Products, concepts, or
benefits described herein will not be offered for sale or distribution until completion of field testing and applicable regulatory reviews. Each Phase represents only the lead event for each
program. Discovery and market evaluation is an ongoing process for all traits and programs in the pipeline. (2) Estimated Peak Sales range provided for projects Phase 3 or later in
pipeline: L= $0-100MM, M= $100-500MM, H= $500MM+ (3) Market Opportunity reflects estimated total acres in Primary Markets in millions. □ Indicates advancement or addition (2/132/14).
18
Global Reach in Seeds (millions of hectares harvested)
Corn
7
Sunflower
13
Oilseed Rape 2
Corn
Soybeans
Wheat
Canola
40*
33*
33*
9*
Corn
Corn
Rice
Corn
36
9
44
16
Corn
18
Soybeans 30**
~50% of our Growth over the Next 5 Years Outside of North America
Source: USDA Production, Supply and Distribution database for crop year 2013/14
* US and Canada represent planted hectares.
** Soybean hectares represent Brazil only.
19
Strategic Growth in Priority Markets
• North America remains a high priority
• Lower value to higher value crop shift for
Western Canada
• Investment, solid growth and rapid
technology adoption in Brazil
• Brand equity and local investment in
Eastern Europe
• Building meaningful distribution system
for multi-crop in India
• In China, with China
• Strong business, Pannar acquisition and a great
future for Africa
20
Agriculture– Industry Leading Execution
•
•
12% compound annual rate of sales
growth and improved operating margins
about 600 bp from 2008 to 2013
Industry leading performance in 2013
Key Growth Drivers
• Product and service innovation
•
Developing markets
•
Strategic investments
•
Margin expansion
Sales and Margin Performance
$11.7
$6.5
21%
15%
2008
2013
Sales ($B)*
Operating Margins (%)**
Long-Term Growth Targets: Sales 8-10% CAGR with 22-24% Margins
* Segment sales include transfers.
** Excludes non-operating pension/OPEB costs and significant items. See company website for detailed reconciliation of
non-GAAP measures.
21
Right Product Right Acre
22
Copyright © 2014 DuPont. All rights reserved.
The DuPont Oval Logo, DuPontTM, The miracles of scienceTM, and
all products denoted with ®, TM or SM are registered trademarks, trademarks or
service marks of E. I. du Pont de Nemours and Company or Pioneer Hi-Bred
International, Inc. unless otherwise noted.
23
^
^
Agrisure® and Agrisure Viptera® are registered trademarks of, and used under license from, a Syngenta Group Company. Agrisure® technology incorporated into these seeds is commercialized under a license from
Syngenta Crop Protection AG. Herculex® Insect Protection technology by Dow AgroSciences and Pioneer Hi-Bred. Herculex® and the HX logo are registered trademarks of Dow AgroSciences LLC. The Enlist trait and
Enlist Weed Control System are technologies owned and developed by Dow AgroSciences. Enlist is a trademark of Dow AgroSciences LLC. Liberty®, LibertyLink® and the Water Droplet Design are trademarks of
Bayer. YieldGard®, the YieldGard Corn Borer design, Roundup Ready®, Roundup Ready 2 Xtend™ are trademarks used under license from Monsanto Company. The unique Clearfield symbol and Clearfield® are
registered trademarks of BASF.The Enlist ™ trait and Enlist Weed Control System are technologies owned and developed by Dow AgroSciences. Enlist ™ is a trademark of Dow AgroSciences LLC. Components of the
Enlist Weed Control System have not yet received regulatory approvals; approvals are pending. The information presented is not an offer for sale.
Products, benefits and concepts described herein will not be offered for sale or distribution until completion of field testing and applicable regulatory reviews. Pioneer® brand soybeans with the Roundup Ready 2
Xtend™ or Enlist™ technology will not be offered for sale or distribution until completion of field testing and applicable regulatory reviews Pioneer® brand hybrids with event DP 4114 will not be offered for sale or
distribution until completion of field testing and applicable regulatory reviews. Pioneer® brand canola hybrids with glyphosate resistance will not be offered for sale or distribution until completion of field testing
and applicable regulatory reviews..
DuPont Pioneer research plot yield data for Plenish® soybeans are from 346 observations in Indiana and Ohio depicting an average yield on Plenish® high oleic soybean commercial varieties compared to average
yield of Pioneer® brand elite soybean checks in 2011 – 2013.
^ EXPORT APPROVAL NOTICE: This product is fully approved in the United States and Canada. Traits included in these products may or may not be approved in all global markets; therefore, the combination of
these traits and the grain and certain by-products (including oil, dried distillers grain, cobs, and husks) from THESE PRODUCTS MAY NOT BE APPROVED for all markets. Growers that use Pioneer® brand seed with
biotech traits are required and agree to adhere to the stewardship requirements as outlined in the DuPont Pioneer Product Stewardship Guide. For questions regarding product stewardship and biotech traits
please contact your sales representative or refer to www.pioneer.com/stewardship. Growers are required to discuss trait acceptance and grain channeling policies with their local grain handler prior to delivering
grain containing biotech traits.
Always read and follow all precautions and directions provided in product labeling before making in-crop or other applications of any agricultural herbicides or using any other pesticide.
Pioneer is a member of Excellence Through Stewardship® (ETS). Pioneer is a member of Excellence Through Stewardship® (ETS). Pioneer products are commercialized in accordance with ETS Product Launch
Stewardship Guidance and in compliance with the Pioneer policies regarding stewardship of those products. Crops and materials containing biotech traits may only be exported to or used, processed, or sold in
jurisdictions where all necessary regulatory approvals have been granted for those crops and materials. It is a violation of national and international laws to move materials containing biotech traits across
borders into jurisdictions where their import is not permitted. Growers should discuss these issues with their purchaser or grain handler to confirm the purchaser or handler's position on products being
purchased. Excellence Through Stewardship® is a registered trademark of the Biotechnology Industry Organization.
The DuPont Oval Logo is a registered trademark of DuPont.
®, SM, TM Trademarks and service marks of Pioneer.
© 2014 PHII.
24
Biotech Trait R&D
DuPont Pioneer R&D is Committed to Delivering Superior Germplasm, Traits and Trait Combinations in the
Most Productive Products for Our Customers. Our advanced Biotech Pipeline Programs Are an Integral Part
of Our Approach as We Deliver the Right Product on the Right Acre
Launch
Phase 4
Pre-launch
Phase 3
Advanced development
Phase 2
Early development
Phase 1
Proof of concept
Discovery
Select product target
Define targets based on
current and anticipated future
customer needs, and
advancing scientific
capabilities.
Identify leads
Screen potential genes to find
a gene or combination of
genes that demonstrate
efficacy against the target.
Crop transformation
Insert gene leads into target
crop.
Demonstrate proof of
concept
Test genes to confirm efficacy
against the target.
Gene and construct
optimization
Evaluate genes and
constructs for trait efficacy
and agronomic performance
in the target market
environment. Optimize for
trait and stack performance.
Production transformation
Insert constructs into
target crop to generate
multiple events.
Event characterization
Select best events across
germplasm and
environments.
Event Development
Expand field testing of
candidate commercial lead
events across stacked trait
and germplasm
combinations.
Initiate regulatory testing
Start regulatory studies,
including method
development & validation.
Advanced field testing
Further characterize
lead commercial events
across germplasm and
environments and select
event(s) for regulatory
submission.
Regulatory testing
Complete regulatory studies
for primary markets.
Regulatory dossier
submission
Submit extensive data
package and analysis to
authorities.
Regulatory testing
Complete regulatory studies
for additional submissions
(e.g. stacks).
Trait introgression and
seed ramp up
Breed trait into elite
germplasm across maturities
and intensify ramp-up of
seed quantities.
Pre-marketing
Prepare customer education
plans. Perform market
testing. Prepare commercial
seed volumes.
IMPACT™ testing
Field test new products in
development near the
customer. Focus interactions
to deliver Right Product on
Right Acre following
commercialization.
Regulatory approvals
Receive all regulatory
approvals for launch
cultivation.
Commercial sales begin
Pioneer works customer-bycustomer and market-bymarket to deliver the Right
Product on the Right Acre
tailored to individual
grower needs.
Product stewardship
Continue ongoing
stewardship practices which
began in research. These
include education and
communication to ensure
compliance with regulations,
Pioneer policies and crop
management strategies.
Early trait introgression
Breed events into a broader
set of elite germplasm.
25

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