Colony Collapse Disorder is killing bees all over the world. For the last half decade, this mysterious affliction has been growing increasingly more deadly and spreading prolifically, to the point where today lawmakers across the planet are scrambling to allocate funds toward finding a workable remedy to the problem.
What is Colony Collapse Disorder (NASDAQ:CCD)? No one is really sure, despite the tens of millions of dollars invested in researching the phenomenon in the U.S. alone. It's an amalgam of issues, really, that have militated together to destroy between 30% and 50% of the American apiary community's stock annually. That is no laughing matter, particularly when you consider the tremendous reliance we have on bees for our food supply.
According to the Congressional Research Service, honey bees contribute to the growth of up to $20 billion worth of agricultural produce annually. That's roughly a quarter of the country's gross annual agricultural output. And that includes only known, commercially operated agricultural farms. There's no guessing how much both small scale farms and natural plant pollination contribute to the nation's overall food supply.
That's why lawmakers are worried. And not just lawmakers-- apparently the U.S. Department of Defense also considers it an issue worth monitoring. With food inflation on the rise globally and shortages last year triggering disturbances in the Middle East and North Africa, the Department of Defense is taking no chances. The DoD has been active on two fronts: first, by budgeting generous sums toward research initiatives in co-operation with the Environmental Protection Agency and Dept. of Agriculture, as well as teaming with both public and private academic efforts to develop remedies.
Second, they've made specialized technological assistance available in the form of equipment used to detect biological and other chemical pathogens that could potentially threaten American troops. Indeed, these devices have proven useful in identifying the underlying causes behind the massive bee die-offs of the last few years. With so much of the nation's food supply riding on dependable bee pollination, the DoD recognizes that it simply can't afford to leave the situation to deteriorate.
Commercial Interest Abounds
On the commercial front, too, there's been great interest in developing a cure. Last September, agro-chemical giant Monsanto (NYSE:MON) entered the CCD fray with its buyout of an Israeli research firm, Beeologics, a leader in the search for a CCD remedy. Terms of the deal remain undisclosed.
Beeologics had been investigating CCD since 2007, and in 2008 announced the company had found a cure. Extensive testing on hives in Florida showed the company's solution, Remebee, based on a process called 'gene-silencing', had a positive effect on CCD affected hives. After Remebee was granted initial EPA approvals, Monsanto came buzzing and eventually bought the company.
It was a big win for Monsanto, as Beeologics reportedly has close relations with the U.S. Department of Agriculture (USDA). The USDA's Agricultural Research Service apparently considers Beeologics to be one of the "foremost bee research organizations in the world."
Monsanto Holds the Keys
Monsanto now holds the keys to the further refinement, manufacture and marketing of Remebee, a development that has many folks in the greener corners of blogosphere outraged. Monsanto is the culprit, they say - the cause of CCD - the company's very pesticides and herbicides being responsible for the sudden, vast losses that have stricken the honey bee industry.
Its purchase of Beeologics-- these same writers argue-- was a cynical means of burying the company's involvement in the problem, in order to avoid potential lawsuits over losses stemming from CCD.
We hope to be addressing this issue in more depth in a forthcoming article on Seeking Alpha. In the meantime, Remebee is undergoing large-scale, FDA sanctioned clinical trials across the United States that Beeologics expects will vindicate it as the product of choice for Israel Acute Paralysis Virus (a related disease) and, according to the company's website, "other bee viruses" as well.
Beeologics website also states that Remebee is effective in reducing the impact of Colony Collapse Disorder.
BeesFree (OTCPK:BEES) Already Selling CCD Remedy Globally
But Monsanto is not the only player in the search for a CCD cure. In fact, all things considered, Monsanto may be falling significantly behind a much smaller rival. BeesFree is a Rome, Italy based research company dedicated exclusively to the remedy of Colony Collapse Disorder. The company's patent pending formula has already proved itself in clinical trials in Italy, and BeesFree is now filling orders from beekeepers and agricultural institutions in South America and Africa.
The company's first order, received back in February of this year by the Centro de Estudies Territoriales (CET) in Chubut Province, Argentina was for $100,000 U.S. The success of that sale quickly piqued the interest of that country's National Institute of Agricultural Technology, with whom BeesFree subsequently signed a long term cooperation agreement to mitigate the occurrence of CCD throughout Argentina.
BeesFree's CEO, Mario Sforza, is on record as saying that the Argentinian studies now being conducted -- under significantly different climatic conditions -- will replicate the results achieved by trials in Italy. According to BeesFree's website, beekeepers in Italy "reported an increase of 50% in beehive populations … whereas adjacent beekeepers not utilizing the system reported losses in excess of 40% in populations annually.
The company's product and its patented dispenser are billed as virtually maintenance free and effective with the full range of bee variations, while also being suited to a widely variant range of weather conditions.
African Market is Vast
The company's recent South African order came in at just under $300,000 U.S. and marks its opening foray into the African market, which it estimates to be home to 20% of the world's commercial honeybee colonies and represents a market of roughly $500 million annually.
The global market for BeesFree's product is estimated at anywhere between $2 and $3 billion, and CEO Sforza is confident that BeesFree's status as the first viable product in the marketplace will give it a competitive advantage that even heavyweights like Monsanto won't be able to overcome.
Unless, of course, they buy BeesFree out.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.