The DOJ Approves a Merger Between Bayer and Monsanto
The Department of Justice approved a merger between agrochemical giants, Bayer and Monsanto. The merger will leave only four companies controlling most of the seeds and agrochemicals.
Six companies have controlled the seed, trait, and pesticide business since the 1990s: Monsanto, Bayer, BASF, Syngenta, Dow, and DuPont. Those six companies grew mainly from acquiring small to medium size companies engaged in biotechnology research. In 2017, DuPont and Dow Chemical merged, reducing the companies down to five.
Farmers, consumers, and environmentalists are concerned about the merger. And there were over one million public comments opposing the merger. A recent survey found that 93 percent of farmers oppose it.
Farm groups conducted the survey from January 26 to February 12, 2018, and collected 957 responses from farmers in 48 states. The farmers who responded to the poll cultivate nearly two million acres. Most of the farmers polled (94 percent) are concerned that the merger will harm farming communities and independent farmers. The farmers are also concerned that Bayer/Monsanto will use its dominance in one product to push sales of other products, control data about farm practices, and the merger will end up increasing pressure for chemically dependent farming. Other concerns of the farmers include seed prices increasing, decreasing innovation in seeds and chemicals, and fewer seed varieties.
Bayer and Monsanto tout the benefits of the merger on a combined website called Advancing Together. “We expect this to result in significant and lasting benefits for farmers: from improved sourcing and increased convenience to higher yield, better environmental protection and sustainability,” the website declares.
Despite the assurances of the two companies, increased concentration in the agrochemical industry tends to decrease the variety, diversity, and choices concerning seeds. Seed genetics have not improved in the last decade according to the farmers polled, with 70 percent reporting that seed genetics have stayed the same or diminished. Sixty-one percent agreed that “we have fewer seed variety options than five years ago.”
The merger could increase GMO crops
Genetically modified crops have increased since the 1990s. In 2017, 96 percent of U.S. cotton, 94 percent of soybean, and 92 percent of corn crops were herbicide tolerant. Those numbers were far less in 1997, with 17 percent of soybean, four percent of corn and 11 percent of cotton crops being herbicide tolerant.
Wenonah Hauter, Executive Director, Food & Water Watch notes that the merger “will make it harder to find non-GMO seeds for crops like soybeans and cotton and could make it harder to find non-GMO fruit and vegetable seeds because both firms have been working to impose biotechnology on the last bastion of non-GMO crops.”
The Organization for Competitive Markets states that the merger means one company will “control 77 percent of all seed corn, 69 percent of all seed traits and 58 to 97 percent of the markets in cotton, soybeans, and canola.”
The merger is bad news for farmers
Senator Elizabeth Warren spoke to the Open Markets Institute in December, and mentioned the Bayer/Monsanto merger: “Now the chemical company and pesticide producer Bayer is seeking antitrust approval to acquire the seed giant Monsanto—the world’s largest producer of genetically modified seeds,” she said.
“Think about that. If approved, one gigantic company would supply one-quarter of the entire world’s seeds and pesticides.”
Jason Davidson, Food and Technology Campaign Associate with Friends of the Earth, thinks that the decision by the DOJ to allow the merger “will massively increase the power of major agrochemical companies that already have a stranglehold on our food system.” He added that American farmers will experience “increased seed prices, fewer options, and decreased bargaining power.”
Roger Johnson, President of National Farmers Union, a group that participated in the survey, said that the survey “underscores what we’ve been hearing from our farm family members for decades – that overwhelming consolidation has substantially eliminated competition in the marketplace.” The merger between two agrochemical companies that already have big segments of the market “stands to move each of these factors in the wrong direction, and that is away from competitive markets,” he added.
In other words, the merger between Bayer and Monsanto will only add to the burdens that American farmers already feel.