Leading Sorghum Tech Company Acquires North American Seed Supplier
by Eric Francucci, Analyst, HighQuest Partners
Chromatin, a leading sorghum genetics company, has acquired Vega, Texas-based sorghum seed supplier Kirkland Seed. Kirkland has a 16-year track record providing forage sorghum seed to growers and distributors in North America and the addition of its grower network and production facilities will enable critical expansion of Chromatin’s operating capacity.
Kirkland Seed manager, Lester Kirkland, describes the Kirkland business as, “based on quality seed production, combined with outstanding customer service and relationships,” adding that he is, “pleased to be joining the Chromatin team,” and, “look(s) forward to introducing Chromatin’s full lineup of high performance grain and forage sorghum products.”
Chromatin’s director of plant operations, Ken Thompson, commented on the acquisition’s ability to optimize, “inventory processing capabilities,” adding that, “with this addition, Chromatin will immediately achieve important efficiencies throughout our network.”
Chromatin is a rapidly growing agtech company focused on the development and production of forage, grain, and sweet sorghum seeds across the globe. Their competitive advantage comes from a strong research pipeline and ability to distribute the seeds to growers through in-house distribution and partnerships with strategic players. Commenting on the acquisition, Chromatin CEO Daphne Preuss stated, “This is our fifth recent sorghum transaction completed by our M&A team. Chromatin is expanding to meet the demands of our rapidly growing business.” Amongst these recent transactions are an acquisition of a Mexican seed distributor and a partnership with an African seed distributor, both announced earlier this year.
Sorghum is advantageous over other crops due to its high nutritional content, unique water efficiency, and ability to grow under harsh conditions with limited resources. It can be grown on 80 percent of the agriculture acres on earth. It grows on a wide range of soils, including saline-alkali infertile soils, and is resistant to water-logging resulting from sudden rains. Sorghum can be produced more reliably than other cereals when subject to limited fertilizer inputs.
The crop’s hardiness makes it particularly well suited for planting in sub-optimal growing regions such as Sub-Saharan Africa, where extreme temperatures, constant drought, poor soil, limited access to fertilizers and inputs, and poor farming practices limit the growth of other crops. Furthermore, adoption of Chromatin’s seeds by farmers have shown yield increases of 3-5 times in the region, and sometimes much higher. This “life-changing” effect allows many farmers who had traditionally relied on sorghum as a subsistence crop to monetize their excess production, thereby bolstering the local economy, Preuss in told GAI News in March, as part of a study on the impact potential of sorghum in Sub-Saharan Africa.
The crop’s high efficiency and nutritional benefits have caused it to be grown in large-scale in North America, as well. The United States is a net exporter of sorghum, exporting about half of its production. Domestically, a major use of sorghum is in livestock feed, competitive due to its low-cost and ease of feed acceptance. Another use of the grain is in ethanol production and according to the Sorghum Checkoff, it takes 1/3 of the water to produce the same amount of ethanol with sorghum than corn. DDGS from ethanol production provide a nutritious high-protein, low-fat feed. These benefits and increasing attention on sustainable farming, particularly with regard to water efficiency, will likely drive an increase in sorghum farming.