Global chemical and seed company DuPont has reported higher than expected profits in first quarter 2017, propelled by an increase in sales in the company’s agricultural unit.
Agricultural sales rose by 4% to US$3.93bn in the first quarter, which ended on March 31, with operating earnings increasing 12%, DuPont said in a report on 25 April.
The increase came in the wake of late-season demand in South America and the planting of the largest combined corn and soyabean hectares in the USA.
The company report also said that the launch of new soyabean varieties in North America and increased sunflower seed sales in Europe spurred agricultural profits on.
The increasing focus on soya would, however, drag the company’s profits down in the second quarter, analysts quoted by Reuters said, due to the shift to soyabeans weighing on demand for corn seeds, which make up the bulk of DuPont’s agri sales.
Corn sales accounted for 47% of sales in DuPont’s agricultural unit in 2016, while soyabean made up only 16% of the total, the news agency wrote.
The sales increase comes before DuPont’s planned US$130bn merger with Dow Chemical Company, which DuPont expects to close in August.
The merger has been before regulators since 2015, when it was first announced, but the European Commission (EC)’s approval in March paves the way for the deal to go ahead.
The EC had ruled that parts of DuPont’s crop protection business had to be divested, which speciality chemicals firm FMC Corporation will be buying. In addition, DuPont will be purchasing FMC’s health and nutrition business for US$1.2bn.
Other countries, such as China and the USA, have not yet given their go-ahead for the merger.