A joint venture between Monsanto Co. (MON) and Cargill Inc. (X.CRG) has posted more than $300 million in losses since its 1999 startup and could wither without a swift infusion of new funding, auditors said in a regulatory filing. \r\n\r\nBut both parent companies pledged Wednesday to continue underwriting Renessen LLC, despite the mounting red ink and scant revenue from the largely research-and-development project they equally own. \r\n\r\n""Both companies knew coming into this that it'd be several years before we had commercial projects"" emerging from Renessen, said Lori Fisher, a spokeswoman for St. Louis-based Monsanto. ""The bottom line is that Monsanto remains committed to Renessen."" \r\n\r\nMonsanto and Cargill ""have given every indication they're committed to our business and to keep it moving forward,"" Renessen Vice President Doug Hard said.\r\n\r\nMonsanto, an agriculture biotechnology leader, and Cargill, a privately held commodity processor, created Renessen in 1998 to develop and market enhanced crops for grain processing and animal feed markets. At the time, the companies said Renessen had no specified lifespan. \r\n\r\nBut in a filing Tuesday with the Securities and Exchange Commission, auditors Deloitte & Touche wrote that Renessen ""has incurred significant operating losses,"" raising ""substantial doubt about the ability to continue as a going concern."" \r\n\r\nFrom its startup through Aug. 31, the report said, Renessen has posted net losses of $308 million on $9.35 million in revenue, with most of that income related to Renessen's experimental work with high-oil corn. In the first eight months of this year, Renessen lost $52.8 million on $6.1 million in revenues. \r\n\r\nThe auditors noted Renessen's ""recurring losses from development-stage activities"" and the expiration early next year of the ""minimum funding commitment"" by Monsanto and Cargill, based in Minnetonka, Minn. \r\n\r\nRenessen, based in Bannockburn, Ill., ""expects that significant operating expenditures will be necessary to successfully implement its business plan and reach profitability,"" the report said. \r\n\r\nMonsanto, maker of the best-selling Roundup weed killer and a leading developer of insect- and herbicide-resistant crops, said earlier this month it expects to generate $1.2 billion in gross profit from a seed-and-traits portfolio that ""represents the future of Monsanto."" \r\n\r\nCargill, one of the world's largest privately owned companies, processes, sells and distributes agricultural, food, industrial and financial products. \r\n\r\nRenessen expects to draw upon Monsanto's capabilities in biotechnology, crop seed production and agricultural inputs, and on Cargill's global work in animal nutrition, agricultural inputs, grain handling and processing, and risk management. \r\n\r\nMonsanto shares fell 26 cents to close at $27.24 Wednesday on the New York Stock Exchange.Dow Jones News Wire
