Can you share some updates on the agricultural sector and the company in the past year?

2023 and 2024 have been atypical years for the Mexican agriculture, it’s been very complicated for the industry. We faced significant setbacks due to climatic factors. The first four months of this year were devastating; nearly everything that was planted failed due to the lack of water and irrigation. The government prioritized water for urban areas over agriculture, which resulted in insufficient irrigation for crops like corn, wheat, and beans. Consequently, if these grains do not fill out properly, yields plummet, severely impacted the production. While certain regions have experienced good rain and dams are filling up, areas like Sinaloa, Sonora, and Chihuahua continue to suffer from severe drought. This ongoing drought means that areas for wheat, corn, and beans may be reduced significantly next year by 30 to 50 percent in some cases. This will undoubtedly increase imports and further strain the agricultural sector.

Additionally, international crop prices further complicated matters. The Mexican government tends to align payment rates with global prices, leading to an over-reliance on imports. This year, we are importing over 50 per cent of the corn needed for food. It is alarming because local producers are not receiving the support they deserve. High-value crops initially struggled with low prices and yields, but some, like tomatoes and avocados, have started to recover recently. Conversely, agave prices have plummeted due to oversupply, contrasting with the rising prices of tequila.

Recently, we announced a comprehensive partnership with BASF. The collaboration with BASF marks a pivotal moment in the industry and for our company. Both companies prioritize sustainability and seek to develop environmentally friendly solutions. This collaboration enables us to leverage BASF's extensive global presence while combining our expertise in marine algae-based technology to create innovative products that meet the growing demand for a sustainable agriculture.

How important is Mexico to Acadian Plant Health?

Mexico is crucial for our business, contributing around 98 per cent of our revenue in the region. We have a strong market penetration here, especially in high-value crops, with over 50 per cent in the seaweed market and around 35 per cent in biostimulation. Compared to other Latin American countries, Mexico's agriculture landscape presents unique opportunities, particularly in citrus and sugarcane, which are currently experiencing high demand. The importance of sustainable agriculture solutions is increasingly recognized. Producers and authorities are aware of the need for more environmentally friendly practices. Acadian Plant Health focuses on scientific based technologies and aims to maintain a leading position in the seaweed sector. However, the market is competitive, with many claiming similar benefits. Our differentiator lies in our rigorous scientific support for our products. As the demand for bio stimulants continue to grow, especially compared to traditional crop protection methods, we see a significant opportunity in this segment.

What are the agricultural sector's greatest non-climatic challenges?

There is significant competition for labor. The agricultural sector is struggling to attract qualified workers, as industries often pay more and offer better benefits. Many workers prefer industrial jobs due to higher wages and social security. Although the government has made efforts to improve conditions in agriculture. As we look ahead, addressing the regulatory challenges product registration is essential. However, the demand for organic and environmentally safe products is on the rise, creating new opportunities. Our focus will remain on developing innovative and tailored made solutions to the specific needs of each market, emphasizing sustainability and productivity with scientific support. Despite the hurdles, our commitment to preserve our marine resource and growing our market share remains strong.

Can you discuss Acadian Plant Health's approach to innovation and algae cultivation?

The seaweed we use; Ascophyllum nodosum, is a natural resource. Which we take pride of and have a specific department that oversees looking over it for us to be able to provide it for many more years. None the less relying merely on algae will eventually prevent you from meeting the market's demand for higher yields. Therefore, the new technological combinations we are developing will lead to three product lines that are expected to launch in the coming years. Focused on: seed treatment directly on abiotic stress, drought resilience, water uptake and efficiency, and abiotic stress for extreme temperatures, besides these we have some granular products that are anticipated to hit the market within the coming years.

What are Acadian Plant Health's priorities for the coming year?

In the coming year, our company is focusing its energy on developing and bringing to the market our seed treatment technology as well as our abiotic stress technologies. Seed treatment is crucial because it sets the foundation for the entire crop. There is a significant collaboration with BASF on both aspects, which is promising for the future.