The sole U.S. manufacturer of the herbicide Dacthal said it would stop global production of the weedkiller weeks after the Environmental Protection Agency pulled the product from the market over its potential health risk to pregnant farmworkers and fetal development.
American Vanguard Corporation said it has submitted voluntary cancellation requests for all registrations of dimethyl tetrachloroterephthalate, also known as Dacthal or DCPA, in the U.S. and is working with officials to remove the weedkiller from distribution and initiate product return.
The company is proceeding to cancel international registrations, saying in a statement that "product stewardship be international in scope."
Earlier this month, the EPA issued a rare emergency order to suspend Dacthal sales in the U.S. after health data submitted by American Vanguard revealed the potential to harm fetal development. American Vanguard had already ended Dacthal sales for turf and landscape management, though it continued to sell the herbicide to agricultural producers — who use the chemical on crops like broccoli, onions and cabbage.
The decision to end Dacthal production comes after a year of rough earnings at American Vanguard, which recently moved to expedite a corporate transformation plan following the departure of its chief executive. The company has formed an "Office of the CEO" consisting of multiple executives who will "move more boldly and urgently to improve financial performance," according to Scott Baskin, lead board director.
American Vanguard reported higher Dacthal sales in the first quarter due to more expanded supply. The company reduced its sales outlook for the year to factor in the loss of Dacthal sales, targeting a net sales increase between 6% to 9% for the year, down from a previous range of 8% to 12% growth.
Timothy Donnelly, acting CEO, said in an earnings call earlier this month that the company is not aware of any litigation risks in connection to Dacthal, adding the EPA's move was preventative based on limited health data. There has yet to be evidence of a person with a condition that can be traced back to in-utero Dacthal exposure, he said.
"There's been no report of actual harm," Donnelly told investors. "It's the EPA taking measures that they believe are important to ensuring that there's safety in a preventive way.”
