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UPDATE 2-Weed killer made by Monsanto, BASF, gets 'restricted use' label for 2018

2018@ (Adds Monsanto, BASF comment, reaction from scientist, analyst)

NEW YORK, Oct 13 (Reuters) - The U.S. Environmental Protection Agency unveiled new restrictions on Friday on the use of the weed killer dicamba, which has caused widespread crop damage in the Midwest for the past two years.

The EPA said in a statement that certain formulations of the substance will be classified as a restricted-use pesticide, which means only certified pesticide applicators, or people under their supervision, will be allowed to spray it onto crops during the 2018 growing season.

The formulations to which the new rules apply are manufactured by Monsanto and BASF.

"Since we proposed this in a voluntary fashion we're pleased with it," Monsanto Vice President of Global Strategy Scott Partridge said in an interview.

A BASF spokeswoman said the company was "pleased growers will continue to have access" to its herbicide.

The EPA has been conferring with weed scientists and state regulators in periodic conference calls to decide how dicamba should be regulated during the 2018 growing season. In September, sources told Reuters the agency was considering an outright ban on the pesticide, which is known to convert from a liquid to a gas and migrate away from its intended target under certain environmental conditions.

Monsanto and BASF have said their latest formulations of the pesticide were specially designed not to migrate. But farmers reported more damage from migrating dicamba in 2017, the first year the two new formulations were available, than during the previous two years, when some farmers illegally sprayed older, more volatile versions of dicamba onto Monsanto's new dicamba-tolerant cotton and soybeans.

"Nothing in these new restrictions addresses volatility, and that's still an issue," said Aaron Hager, a weed scientist and professor at the University of Illinois.

Monsanto has said most 2017 damage came from improper applications of its product.

The EPA also said it is reducing the maximum wind speed and the hours during each day when dicamba may be sprayed, and requiring farmers to keep records proving they're complying with label instructions.

Jonas Oxgaard, an analyst for the investment management firm Bernstein, said the changes could slow the adoption of Monsanto's dicamba-tolerant seeds, which the company predicted would account for 40 percent of all U.S. soybeans in 2018, because farmers would struggle to find time to apply dicamba.

Hager said he thought the new restrictions would actually lead to more illegal use of older versions of dicamba.

"A restricted-use pesticide is nothing new," Monsanto's Partridge said. "This is not something that is going to be unusual or misunderstood by applicators or growers." (Reporting By Emily Flitter in New York; additional reporting by Tom Polansek in Chicago; Editing by Jonathan Oatis)