The shares of Monsanto (MON) are falling after the company cut its full-year profit guidance, saying that it’s facing “significant headwinds.” Other agricultural companies are also falling in the wake of the news. Prior to Monsanto’s announcement this morning, research firm Bernstein called a bottom in the agricultural cycle and said that companies in the space should benefit from that development.

WHAT’S NEW: Monsanto lowered its fiscal 2016 ongoing earnings per share guidance to $4.40-$5.10 from $5.10-$5.60. Analysts’ consensus estimate was $5.14. Weak foreign currencies, increased generic competition, and compressed grower margins are weighing on the company’s outlook, it stated. In interviews, Monsanto’s CEO, Hugh Grant, said the company was no longer interested in buying Syngenta (SYT) after the Swiss company agreed to be acquired by ChemChina. Monsanto may not achieve its target of doubling its EPS by 2019 cut to the struggles of this year, added Grant.

STREET RESEARCH: The agricultural cycle is bottoming, as farmers’ profits are rising, Bernstein analyst Jonas Oxgaard stated in a note to investors. Farmers’ net income is rising because their input costs are dropping and they’re benefiting from currency fluctuations, the analyst believes. Farmers’ profits are ultimately the most important determinant of the performance of companies in the agricultural sector, wrote the analyst. According to Oxgaard, the bottoming of the farm sector is positive for Monsanto and Potash (POT), as he expects potash spot prices to trend positively during the spring planting season. DuPont (DD), and Dow Chemical (DOW) should also benefit from the bottoming of the agricultural sector, added the analyst. He kept Outperform ratings on all the stocks named except for Monsanto, as he maintained an Underperform rating on that name.

PRICE ACTION: In late morning trading, Monsanto sank 6.6% to $86.39, Potash climbed 4% to $18, DuPont lost nearly 1% to $62.40, Dow Chemical retreated 0.6% to $49.75 and Agrium (AGU) slipped 1.1% to $87 per share.