Article

by Carey Gillam

ST. LOUIS, Missouri (Reuters) - Monsanto Co. will begin farm trials of its drought-tolerant corn seed next spring, marking the global seed giant's first roll-out of seeds genetically engineered for harsh environmental conditions.

The introduction comes as drought and searing heat this summer have withered crops across the U.S. South.

The new biotech corn seed still needs water to grow healthy plants, but is designed to use moisture more efficiently, said Monsanto global corn technology lead Dusty Post.

"We're not talking about being able to grow corn in a desert," said Post. "We're not going to make them whole. But every bushel counts."

Monsanto is working to sign up about 250 U.S. farmers in the western corn belt - Nebraska, Kansas, South Dakota, Colorado and Texas - for planting next spring.

Acreage for the farm trials would be small, about 10,000 acres, said Post.

Monsanto is working on the seed with German chemicals giant BASF Corp and expects approval this year from U.S. regulators. Until it has export approval, Monsanto will work with producers to keep the corn out of export channels, and make sure it is used domestically as livestock feed, Monsanto officials said.

Producers are likely to welcome any product that more effectively helps them deal with adverse weather, said National Corn Growers Association spokesman Mark Lambert.

"Weather is one variable that farmers cannot control and any product that can help to manage or deal with weather extremes is going to be something farmers will take a serious look at," Lambert said.

Monsanto's development of genetically altered crops has largely focused on corn, soybeans, cotton and other plants designed to resist insects and tolerate treatments of Monsanto's Roundup herbicide.

But persistent drought in recent years around the globe has left farmers eager for crops that need less water. The U.S. Department of Agriculture has pegged average annual global corn crop losses due to at least moderate drought at about 15 percent.

Research on drought-tolerant crops has taken on added urgency as scientists predict a trend of worsening drought and hotter temperatures around the globe.

Water shortages are already costing billions of dollars a year in crop shortfalls around the world, and are likely to grow more costly, according to academic and government forecasters.

Monsanto rivals are also working on crops that can do well with less water, as food demand rises around the world. DuPont's Pioneer Hi-Bred International, started offering a drought-resistant corn this spring in the western corn belt.

(Reporting by Carey Gillam; editing by Sofina Mirza-Reid and Marguerita Choy)