Company Name: Monsanto Co.
Public Availability Date: November 26, 2003

Document Sections:

INQUIRY LETTER
APPENDIX 1
APPENDIX 2
APPENDIX 3
STAFF REPLY LETTER
STAFF REPLY LETTER

[INQUIRY LETTER]

November 5, 2003

Office of Chief Counsel
Division of Corporation Finance
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549

Re: Monsanto Company - File No. 001-16167 Statement of Reasons for Omission of Shareholder Proposal Pursuant to Rule 14a-8(j)

Ladies and Gentlemen:

Monsanto Company, a Delaware corporation ("Monsanto" or the "Company"), has received a stockholder proposal (the "Proposal," attached as Exhibit A) from a purported Monsanto stockholder Nick Rossi, naming John Chevedden as his designated representative (collectively, the "Proponent"), that the Proponent wishes to have included in Monsanto's proxy statement (the "Proxy Statement") for its 2004 annual meeting of stockholders (the "2004 Annual Meeting").

The Proposal and its supporting statement do not satisfy several requirements of Rule 14a-8. Monsanto has notified the Proponent by letter (attached as Exhibit B) of its intention to omit the Proposal from the Proxy Statement on account of Rule 14a-8(f) unless the Proponent timely corrects his failure to demonstrate his eligibility to submit a shareholder proposal as required by Rule 14a-8(b). The Company is awaiting a response from the Proponent. Even if the Proponent corrects such procedural and eligibility deficiency, Monsanto intends to omit the Proposal under Rules 14a-8(i)(1) and Rule 14a-8(i)(3) promulgated under the Securities Exchange Act of 1934, as amended.

Accordingly, on behalf of Monsanto, we hereby submit this statement of reasons for exclusion of the Proposal from the Proxy Statement, for filing pursuant to Rule 14a-8(j) and hereby request that the Staff confirm that it will not recommend enforcement action against Monsanto should Monsanto omit the Proposal from the Proxy Statement.

Monsanto seeks relief for good cause from the Rule 14a-8(j) requirement that the Company file its reasons for excluding the Proposal no later than 80 days before it files its definitive form of proxy with the Commission. As a result of Monsanto's change from a calendar year fiscal year to an August 31 fiscal year, the 2004 Annual Meeting will be held on January 29, 2004. By press release and a Form 8-K filed with the Commission on September 24, 2003, Monsanto publicly disclosed the date of the 2004 Annual Meeting (which is only nine months after its 2003 Annual Meeting as a result of the change in the fiscal year), its expectation to print and mail definitive proxy materials on or before December 12, 2003 and the related change in deadline for submissions of stockholders proposals on account of Rule 14a-8(e)(2) to November 6, 2003. The Company wanted to provide shareholders adequate time to submit shareholders' proposals in view of the change in fiscal year and the date of the Company's 2004 Annual Shareholders Meeting. The Proposal was received by Monsanto October 27, 2003,1 which is fewer than 80 calendar days prior to the date the Company plans to file its definitive proxy material. We believe the change in the relevant time periods arising from the recent change in Monsanto's fiscal year constitutes good cause for the Staff to waive the 80 day deadline.

The Proposal

The Proposal is so vague and indefinite that shareholders will not be able understand what they are voting on and the Company will not be able to implement the Proposal even if adopted. Monsanto does not have a poison pill. Accordingly, the first sentence of the Proposal appears to have no relevance until after such time, if any, as Monsanto's Board of Directors may determine to adopt a rights plan in the future. The second sentence of the resolution, that "Once adopted, removal of this Proposal or any dilution of this Proposal, would consistently be submitted to shareholder vote at the earliest subsequent shareholder election," is of even more uncertain meaning or effect. The Company is unable to determine what actions would constitute a "removal of this Proposal or any dilution of this Proposal," what should thereafter be submitted to a shareholder election or what the effect of a favorable or unfavorable vote would be.

In prior no-action letters, the Staff has found it proper to omit stockholder proposals pursuant to Rule 14a-8(c)(3), the predecessor to Rule 14a-8(i)(3), where such proposals were "so inherently vague and indefinite that neither the stockholders voting on the Proposal, nor the Company in implementing the Proposal (if adopted) would be able to determine with any reasonable certainty exactly what actions or measures the Proposal requires." See Philadelphia Electric Co. (available July 30, 1992). The Proponent is well aware of the requirements of Rule 14a-8(i)((3) as the Staff has previously required this Proponent to make substantial revisions to a shareholder proposal that relied on highly selective and misleading excerpts from respected publications. See e.g., General Motors Corporation (available April 10, 2000).

Furthermore, it is unclear whether the second sentence of the proposal is intended to be binding or advisory, and thus may not be a proper subject for action by shareholders under Delaware law and excludable under Rule 14a-8(i)(1). The Staff has repeatedly required this Proponent to revise its prior shareholder proposals to clarify that the entire proposal was advisory. See, e.g., Caterpillar Inc. (available January 13, 2000); Sempra Energy (available February 29, 2000); and The Home Depot, Inc. (available April 4, 2000).

The Supporting Statement

The Proposal's supporting statement contains what purport to be excerpts from various publications and other statements which are false and misleading in several respects, and therefore may be omitted under Rule 14a-8(i)(3). In particular, we note the following:

First, none of the statements under the captions which are attributed to various sources is an accurate excerpt, but rather is the Proponent's paraphrase that omits key words or phrases (See Exhibits 1-4). We believe the Proponent should clarify that these statements are his own paraphrases, rather than accurate excerpts.

Second, the first paraphrased statement cites The Wall Street Journal, without noting that it is taken from an "op-ed" opinion piece, and thus is simply one person's opinion (namely, Holman W. Jenkins, Jr.) rather than a news report (copy attached as Exhibit 1). We believe this reference should be clarified.

Third, the paraphrased statements from The Motley Fool and morningstar.com are taken out of context in a manner that is highly misleading, giving the erroneous impression that The Motley Fool or morningstar.com are opposed to poison pills generally. That is not the case.

While the supporting statement references a sentence from a 1997 story in The Motley Fool, a much more recent article in The Motley Fool about corporate governance includes the following statement about poison pills:

"Investors should cheer "poison pill" plans if they support and trust management, since what they do is help protect the company from interlopers." (The Motley Fool, August 7, 2001 at http://www.fool.com/specials/2001/sp010802e.htm; copy attached as Exhibit 5).

Similarly, the supporting statement misleadingly paraphrases one sentence from an article in morningstar.com, without noting the following statements from the same Morningstar article:

"The issue of whether poison pills are good or bad is less clear-cut than stock-option and executive-compensation abusesthere's research that actually supports poison pills. For example, the stock of a good company can easily get beaten down in the short term for reasons out of its control. A poison pill protects investors in such a company from being taken out by a larger, mediocre one at a price well below its intrinsic value. Poison pills are also pretty common, even among great companies."

(http://news.morningstar.com/doc/article/0,1,95306,00.html; copy attached as Exhibit 4).

For the foregoing reasons, we believe the citations to The Motley Fool and morningstar.com should be deleted. The Proponent may recast these statements as his own beliefs, rather than implying that they fairly and accurately represent the views of such well-known third parties.

In the absence of the Proponent's substantially revising the supporting statement to comply with Rule 14a-9, Monsanto requests that the Staff confirm that it will not recommend enforcement action against Monsanto should Monsanto omit the supporting statement in its entirety.

Finally, each of the bold captions in the supporting statement is inflammatory and misleading:

The first caption, "The Potential of a Tender Offer Can Motivate Our Directors," falsely implies that poison pills preclude even the "potential of a tender offer". They do not. Hundreds of companies that have had poison pills have been the subject of tender offers.

The second caption, "Diluted Stock," implies that the adoption of a pill would dilute Monsanto's stock. That is false. While the threat of potential dilution gives the pill its poison, in fact no poison pill has ever been triggered so as to cause dilution. The adoption of a pill causes no dilution.

The third caption, "Akin to a Dictator," violates the plain language of the instructions to Rule 14a-9. These instructions expressly identify material as misleading for purposes of the Rule if they "directly or indirectly impugn character, integrity or personal reputation, or directly or indirectly make charges concerning improper, illegal or immoral conduct or associations, without factual foundation." Likening Monsanto's directors to dictators, should they choose later to adopt a poison pill, falls squarely within the prohibitions of that Rule.

The fourth caption, "Council of Institutional Investors Recommendation," falsely implies that the Council of Institutional Investors recommends a vote for this Proposal. No such recommendation has been made.

For the foregoing reasoning we believe all of the captions should be deleted.

* * * * * *

Pursuant to Rule 14a-8(j)(2), filed herewith are six copies of this letter as well as six copies of the Proposal which includes a supporting statement from the Proponent. If you have any questions regarding this matter or require additional information, please contact the undersigned at (212) 403-1220 or Roy Katzovicz of this office at (212) 403-1313, or Nancy Hamilton, Associate General Counsel, Corporate Governance, Monsanto Company at (314) 694-4296. If the Staff does not agree with the conclusions set forth herein, please contact us before you issue any formal written response.

Very truly yours,

/s/

Eric S. Robinson

Encl.

cc: Mr. Charles W. Burson, Esq.
Ms. Nancy E. Hamilton, Esq.
Mr. Nick Rossi
Mr. John Chevedden

-----FOOTNOTES-----

¹ While the Proposal is dated October 7, 2003, it was first received by Monsanto by fax transmission on October 27, 2003.

[APPENDIX 1]

3 - Shareholder Input on a Poison Pill

RESOLVED: Shareholders request that our Directors increase shareholder voting rights and submit the adoption, maintenance or extension of any poison pill to a shareholder vote. Also once this proposal is adopted, dilution or removal of this proposal is requested to be submitted to a shareholder vote at the earliest possible shareholder election. Directors have discretion to set the earliest election date and in responding to shareholder votes.

I do not see how our Directors object to this proposal because it gives our Directors the flexibly to ignore our shareholder vote if our Directors seriously believe they have a good reason. This topic won an overall 60% yes-vote at 79 companies in 2003. I believe majority shareholder votes are a strong signal of shareholder concern.

Nick Rossi, P.O. Box 249, Boonville, Calif. 95415 submitted this proposal.

The Potential of a Tender Offer Can Motivate Our Directors

Hectoring directors to act more independently is a poor substitute for the bracing possibility that shareholders could turn on a dime and sell the company out from under its present management.

Wall Street Journal, Feb. 24, 2003

Diluted Stock

An anti-democratic scheme to flood the market with diluted stock is not a reason that a tender offer for our stock should fail.

Source: The Motley Fool

Akin to a Dictator

Poison pills are akin to a dictator who says, "Give up more of your freedom and I'll take care of you.

"Performance is the greatest defense against getting taken over. Ultimately if you perform well you remain independent, because your stock price stays up."

Source: T.J. Dermot Dunphy, CEO of Sealed Air (NYSE) for more than 25 years

The key negative of poison pills is that pills can preserve management deadwood instead of protecting investors.

Source: Moringstar.com

I believe our Directors could make a token response to this proposal - hoping to gain points in the new corporate governance rating systems. A reversible response, which could still allow our directors to give us a poison pill on short notice, would not substitute for this proposal.

Council of Institutional Investors Recommendation

The Council of Institutional Investors www.cii.org, an organization of 130 pension funds investing $2 trillion, called for shareholder approval of poison pills. Based on the 60% overall yes-vote in 2003 many shareholders believe companies should allow their shareholders a vote.

Notes:

The above format is the format submitted and intended for publication.

Please advise if there is any typographical question.

The company is requested to assign a proposal number (represented by "3" above) based on the chronological order in which proposals are submitted. The requested designation of "3" or higher number allows for ratification of auditors to be item 2.

References:

The Motley Fool, June 13, 1997

Moringstar.com, Aug. 15, 2003

Mr. Dunphy's statements are from The Wall Street Journal, April 28, 1999.

IRRC Corporate Governance Bulletin, June - Sept. 2003

Council of Institutional Investors, Corporate Governance Policies, March 25, 2002

Please advise within 14 days if the company requests help to locate these or other references.

[APPENDIX 2]

Nick Ross
P.O. Box 249
Boonville, CA 95415

Mr. Frank AtLee III
Monsanto Co. (MON)
800 North Lindbergh Blvd.
St. Louis. MO 63167
PH: 314-694-1000
FX: 314-694-1057

Dear Mr. AtLee,

This Rule 14a-8 proposal is respectfully submitted for the next annual shareholder meeting. This proposal is submitted in support of the long-term performance of our company. Rule 14a-8 requirements are intended to be met including ownership of the required stock value until after the date of the applicable shareholder meeting. This submitted format, with the shareholder-supplied emphasis, is intended to be used for definitive proxy publication. This is the proxy for Mr. John Chevedden and/or his designee to act on my behalf in shareholder matters, including this shareholder proposal for the forthcoming shareholder meeting before, during and after the forthcoming shareholder meeting. Please direct all future communication to Mr. Chevedden at:

2215 Nelson Ave., No. 205
Redondo Beach, CA 90278
PH: 310-371-7872

Your consideration and the consideration of the Board of Directors is appreciated.

Sincerely,

/s/

Oct 7-03

cc: Charles Burson

Corporate Secretary

FX 314-694-6399

The attached shareholder proposal is submitted consistent with the above letter. Sincerely,

/s/

November 7, 2003

[APPENDIX 3]

EXHIBIT B

October 29, 2003

Mr. John Chevedden
2215 Nelson Avenue, No. 205
Redondo Beach, CA 90278

Re: Shareholder Proposal for Monsanto's 2004 Annual Meeting

Dear Mr. Chevedden:

I am in receipt of a letter dated October 7, 2003, which I received by fax on October 27, 2003, from Mr. Nick Rossi containing a shareholder proposal submitted for inclusion in Monsanto Company's ("Monsanto") proxy statement for its 2004 Annual Meeting (the "Annual Meeting"). The letter indicates that you are his designated representative to act on his behalf in shareholder matters, including this shareholder proposal, before, during and after the Annual Meeting, and that all communications are to be directed to you with respect to this shareholder proposal.

Mr. Rossi's letter to us failed to demonstrate his eligibility to submit a shareholder proposal as required by Rule 14a-8(b) promulgated under the Securities Exchange Act of 1934. I note that his letter states "Rule 14a-8 requirements are intended to be met including ownership of the required stock value until after the date of the applicable shareholder meeting." We have checked with our transfer agent, Mellon Investor Services, which has informed us that Mr. Rossi is not a registered holder of any Monsanto shares. Thus, pursuant to Rule 14a-8(b), you must prove Mr. Rossi's ownership of the required minimum amount of Monsanto voting stock, for the required duration of time, in the manner required for a proponent of a shareholder proposal who is not a registered shareholder.

Pursuant to Rule 14a-8(f), we hereby notify you that if you fail to respond to and correct this deficiency within 14 days from the date that you receive this letter, Monsanto intends to exclude this proposal from its proxy statement for the Annual Meeting.

Please be advised that, even if you correct this eligibility and procedural deficiency, Monsanto intends to seek to exclude this proposal under Rule 14a-8(i).

Sincerely,

/s/

Charles W. Burson
Executive Vice President, Secretary and General Counsel

cc: Mr. Nick Rossi
P.O. Box 249
Boonville, CA 95415

[STAFF REPLY LETTER]

6 Copies

7th copy for date-stamp return

November 21, 2003

Via Airbill
Office of Chief Counsel
Division of Corporation Finance
Securities and Exchange Commission
Mail Stop 0402
450 Fifth Street, NW
Washington, DC 20549

Response to Wachtell, Lipton, Rosen & Katz No Action Request of November 5 Monsanto Company (MON) Nick Rossi

Ladies and Gentlemen:

The section of the company no action request titled "The Proposal" is obsolete because this part of the proposal was revised and forwarded to the company on November 7, 2003 prior to the proposal submittal deadline. The revised proposal is included here. I believe the November 7, 2003 submittal answers the company objections to the resolved section of the earlier submittal.

The company has addressed the supporting statement text with a number of unsupported "requests," raw opinions and opinions which are thinly supported or supported with erroneous verbiage. The key part of the company tactic seems to be that repetition of requests and beliefs will tip the scales.

Examples include:

The company backs-up its argument on "accurate excerpts" with "we believe."

The company errs in missing the irony in The Motley Fool on August 7, 2001. I believe the August 7, 2001 text is intended to mean that investors should "cheer" poison pills if they "support and trust" management 100%. I believe that including the term "interlopers" is another indication by The Motley Fool that it is spoofing the poison pill.

The company does not explain how the Morningstar source is misleadingly paraphrased. Instead the company skips onto arguing about another part of the Morningstar source.

The Wall Street Journal article is from the special 12-page Feb. 24, 2003 "Corporate Governance" section.

Unoriginal Time-Wasting Company Claim Company demand that the shareholder proposal include company-chosen text

The company claims that if a source presents more than one-side of an issue (which is standard practice in most business news reporting) then supporting statements must also highlight the company's choice of words from the same source. This company claim applies particularly to The Motley Fool and Morningstar sources. Hence, according to the company each supporting statement would need to say that a particular business news source points out a proponent-favored statement and a company-favored statement. The company does not explain how the proponent would know in advance the company-chosen words.

If this hypothetical process were to proceed without the company resorting to a no-action request, then a ludicrous and prejudicial new procedure would follow:

1) On each proposal the proponent would submit the supporting statements and the sources.

2) Then the company would come back with its chosen words from the same sources which may have even more words than the proponent's related statement. This excess of words is demonstrated by the company quotes from proponent sources in its no action request here.

3) Then the proponent would add the company-chosen words.

4) Then this new company chosen-word text would force out substantial shareholder text to fit the 500-word limit in this ludicrously prejudicial manner.

5) The company would prepare its separate management position statement of unlimited words. However, unlike the proponent the company would be free to omit supporting sources for company claims and omit any proponent-chosen words.

I do not believe it is the job of the shareholder to highlight management's chosen words on an issue when management has an unlimited number of one-sided words to respond versus the shareholder who would then be held to 500-words to ludicrously present both sides. The company is not required to support its statements in its management position response nor present any point that favors the proponent's position.

Under this misleading company argument the "Supporting Statement" section of rule 14a-8 proposals would need to be re-titled "Supporting Statements with Company-Chosen Words on the Same Topic."

This type of time-wasting claim is used to excess by companies who know better. Perhaps this is the red-flag of upcoming tactics in 2004 no action requests from other companies.

Captions

The company fails to acknowledge that the potential for a tender offer can increase, and there will also probably be more tender offers over time, if there is no poison pill in place. In both cases directors could be more motivated to get back on track if they are not thoroughly insulated by a poison pill.

The company errs in claiming that shareholder poison pill proposals cannot address stock dilution because there is a distinction between stock dilution and the "threat" of stock dilution.

The company errs in claiming that a shareholder has already impugned directors if the shareholder alerts other shareholders of the possibility that directors could act in a dictatorial manner if the directors use a devise that limits shareholder rights.

The proposal states that the Council of Institutional Investors "called for shareholder approval of poison pills." The company does not explain how it reaches its raw opinion of an inference from this statement.

The company no action response is an example of the unsupported and unexplained text which companies typically expect to get away with under rule 14a-8. The following numbered text match the numbers marked on the company text:

1) No definition of the standard of independent directors.

It is meaningless and misleading to claim independent directors without any definition of independence.

2) "Can protect..." is a raw statement with no explanation or support.

3) No support or explanation on how a non-binding vote on the next ballot would deny the board speed and flexibility.

4) No support or explanation on how shareholders could be "unprotected."

I do not believe the company has met its burden of proving its allegations.

For the above reasons this is to respectfully request that the Office of Chief Counsel not agree with the company no action request on each point.

Sincerely,

/s/

John Chevedden

cc:

Nick Rossi

Frank AtLee III, Monsanto Company

[STAFF REPLY LETTER]

November 26, 2003

Response of the Office of Chief Counsel Division of Corporation Finance

Re: Monsanto Company

Incoming letter dated November 5, 2003

The proposal requests that the board seek shareholder approval at the earliest subsequent shareholder election for the adoption, maintenance or extension of any current or future poison pills and further recommends, that once adopted, removal or dilution of the proposal be submitted to a shareholder vote.

We are unable to conclude that Monsanto has met its burden of establishing that Monsanto may exclude the proposal under rule 14a-8(i)(1) as an improper subject for shareholder action under applicable state law. Accordingly, we do not believe that Monsanto may omit the proposal from its proxy materials in reliance on rule 14a-8(i)(1).

We are unable to concur in your view that Monsanto may exclude the entire proposal under rule 14a-8(i)(3) as false and misleading or vague and indefinite. There appears to be some basis for your view, however, that portions of the supporting statement may be materially false or misleading under rule 14a-9. In our view, the proponent must:

revise the reference to the Wall Street Journal article to add "Source:" to the beginning of the reference and clarify that the article refers to an opinion article;

revise the sentences attributed to T.J. Dermot Dunphy to clearly identify which sentences are direct quotes;

revise the sentence attributed to Morningstar.com to directly quote the sentence from the source; and

revise the caption "Council of Institutional Investor Recommendation" and the discussion under that caption to make clear that the Council of Institutional Investor's recommendation relates to shareholder approval of poison pills generally and not this specific proposal.

Accordingly, unless the proponent provides Monsanto with a proposal and supporting statement revised in this manner, within seven calendar days after receiving this letter, we will not recommend enforcement action to the Commission if Monsanto omits only these portions of the supporting statement from its proxy materials in reliance on rule 14a-8(i)(3).

We note that Monsanto did not file its statement of objections to including the proposal at least 80 calendar days before the date on with it will file definitive proxy materials as required by rule 14a-8(j)(1). Noting the circumstances of the delay, we grant Monsanto's request that the 80-day requirement be waived.

Sincerely

/s/

Grace K. Lee
Special Counsel