Tech: Grain pest eradicator Bio-Gene scores R&D deal with the world’s largest chemical company
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Agtech company Bio-Gene Technology (ASX:BGT) is working on the latest pest-resistant technologies for grain storage.
And for its newest research & development project, the company has caught the attention of BASF — the German chemicals giant with more than €60 billion ($97.7 billion) in annual revenue.
The two sides have signed a commercial partnership to develop BGT’s Flavocide technology — an insecticide which works as a pest-resistant in grain storage.
Investors reacted positively to the announcement, sending BGT shares up more than 8 per cent higher in morning trade.
The research will be a collaborative effort between Bio-Gene, BASF and a third partner — the Queensland government’s Department of Agriculture & Fisheries (DAF). Bio-Gene said the DAF “are recognised experts in the field of stored grain pests”.
CEO Richard Jagger said the deal was a “major milestone” for Bio-Gene, partly because the backing of a global heavyweight provides strong third-party validation of Bio-Gene’s product.
“BASF are one of the leading developers globally of new chemistry to the agriculture sector, and Bio-Gene will benefit significantly from their resources, access to market channels and support services,” Jagger said.
The work will build on previous trials carried out by Bio-Gene and the DAF, developing optimal formulations to eradicate grain pests which have demonstrated resistance to existing technologies.
Bio-Gene said there’s “no single chemistry” that has proven it can control all major grain pests. Bad cases of pest contamination have caused losses of more than 50 per cent of grain held in storage.
The BASF trial process is expected to take around 12 months to complete. Together, the three parties will work on the best combination of chemicals and optimum application rates.
Following the trials, BASF will then be granted first rights to negotiate a commercial deal with Bio-Gene for distribution in the Australian market.
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