Monsanto Co. pulled the trigger Tuesday on a $975 million expansion at its Luling plant that is expected to add about 100 full-time employees and 20 contractors to the site.
The Luling plant already has around 665 workers. Louisiana Economic Development estimates the project will result in an additional 450 new indirect jobs in the state, for a total of about 550 new jobs.
The plant will produce dicamba, an herbicide used in protecting crops and a key component in its Roundup Ready Xtend Crop System products. Monsanto has said the products may initially be used in soybean and cotton crops. The expansion is expected to be completed in mid-2019.“Our Luling facility’s unique geographic location within our manufacturing network will help provide our farmer customers across the Americas with better access to a critical weed management tool,” Monsanto President and Chief Operating Officer Brett Begemann said in a news release.
Weeds are “a key pest” to agriculture around the world, limiting much-needed nutrients, sunlight and access to water, according to Monsanto. There is no single solution for crop protection. Dicamba is one tool farmers can use to complement other plant protection practices.
Gov. John Bel Edwards said agribusiness and chemistry are two of the most important business sectors in the state.
Monsanto’s investment strengthens both and is a vote of confidence in Louisiana, he said.
“Above all, we’re delighted that hundreds of existing jobs will be secured by this expansion, and that we will grow the workforce of Monsanto with new career opportunities for more Louisiana families,” Edwards said.
Wilma Subra, a chemist and adviser to the Louisiana Environmental Action Network, said the new unit will also increase the pollution and the negative impacts on the surrounding community.
The dicamba the plant produces will also have a negative impact on the environment, Subra said.
Both The Nature Conservancy and the Sierra Club have said Roundup, which kills the milkweed that grows in corn and soybean fields, is one of the main culprits in wiping out 90 percent of the Monarch butterfly population.
Monsanto announced preliminary plans for the project in June, as part of the company’s third-quarter earnings report. At the time, Monsanto said it expected to make a final investment decision on the project in early 2016. But just three weeks later, Jacobs Engineering Group said it had won the engineering and procurement contract for the plant expansion.
Monsanto said it plans to launch its Roundup Ready Xtend Crop System across the United States, Brazil, and other parts of Latin America, meeting the demand across 250 million acres of farmland in the Americas. Once the expansion is completed, Monsanto expects the Luling facility to supply 25 percent to 35 percent of the eventual market demand for dicamba-based products.
To secure the project, Louisiana offered Monsanto a performance-based Modernization Tax Credit of $5 million, along with a performance-based $1.7 million Economic Development Award Program grant to reimburse rail and electrical infrastructure costs associated with the proposed expansion. In addition, Monsanto is expected to use Louisiana’s Quality Jobs and Industrial Tax Exemption programs.
Monsanto’s expansion is the latest in a series of recent expansion projects related to the company’s St. Charles Parish operations. In March 2010, the Luling site completed a $196 million expansion that resulted in 26 new direct jobs and boosted herbicide production by 20 percent. Within the past five years, Air Products and Hexion have built production facilities at the Luling site to supply raw materials to support Monsanto’s operations.