By John Crabtree
This summer, agrochemical, biotechnology, and seed giant Monsanto dropped their bid to acquire their Switzerland-based competitor Syngenta. Initial merger serenades were sternly rebuffed by Syngenta, and Monsanto’s interest turned into a $46.5 billion hostile takeover.
Monsanto had no fear of backlash from U.S. antitrust officials. And there’s the rub, the reason a failed merger is still worthy of note and cause for concern. What level of seed industry consolidation would have to be achieved to trigger interest, let alone action, at the Department of Justice’s Antitrust Division?
According to Dr. Philip Howard of Michigan State University, there have been more than 70 seed company acquisitions by the top eight firms since 2008. Monsanto, DuPont, and Syngenta maintained their dominant position, collectively controlling over 50% of the market, up from 22% in 1996.
Monsanto acquiring Syngenta would have put over half the American seed market in the hands of just two transnational corporations. It’s difficult to imagine a more crucial concern for farmers than who owns and controls the world’s seeds.
Farmers have lost access to varieties while seeing the prices they pay for biotechnology traits through technology agreements skyrocket. Further consolidation in the seed sector will make matters worse.
The failed Monsanto-Syngenta merger should be a clarion call for the Department of Justice Antitrust division to breathe life into the 2009 announcement of their intention to investigate anticompetitive behavior in the seed industry. We are well past the time for action over empty promises.
John Crabtree of the Center for Rural Affairs can be reached at email@example.com. Established in 1973, the Center for Rural Affairs is a private, non-profit organization working to strengthen small businesses, family farms and ranches, and rural communities through action oriented programs addressing social, economic, and environmental issues.