By Rithika Krishna
(Reuters) -Corteva Inc on Wednesday reported a 19.6% jump in first-quarter operating earnings, which beat Wall Street estimates, driven by strong demand for crop protection products such as herbicides and insecticides.
A surge in corn and soybean prices has encouraged U.S. farmers into pre-buying seeds and chemical sprays for spring season after the Russia-Ukraine conflict disrupted supplies from key exporting regions.
"We are seeing that customers are motivated to get the product right now given tight supply chains. We continue to see strong demand for new products as farmers are prioritizing technology for better yield," a company spokesperson told Reuters.
Sales of Corteva (NYSE:CTVA)'s crop-protection products rose 23% in the quarter, boosted by strong early demand for herbicides in North America on supply concerns.
"Looking ahead, we expect healthy market fundamentals to continue given record crop prices, strong farm income levels and demand for food globally", Chief Executive Officer Chuck Magro said in a statement.
Corteva said its net seed sales grew 1%, driven by an 8% increase in price.
The Wilmington, Delaware-based company's net sales rose 10.12% to $4.6 billion, beating market estimates of $4.5 billion, according to Refinitiv.
Corteva said adjusted operating earnings stood at $708 million, or 97 cents per share, in the three months ended March 31, compared with $592 million, or 79 cents per share, a year earlier. Analysts, on average, had expected a profit of 82 cents per share.
The company also revised its full-year 2022 operating earnings per share forecast to between $2.35 and $2.55 to reflect a lower average share count.