TOPICS

Monsanto + Syngenta: agribusiness giants consolidate

Monsanto + Syngenta: agribusiness giants consolidate

By Carmelo Ruiz Marrero *

In April 2015, the American Monsanto had offered to buy Syngenta for $ 45 billion, but the European company wanted more money. Now both may be more willing to compromise in light of the imminent merger of two other agribusiness giants: Dow and Dupont. According to agricultural scientist and analyst Charles Benbrook, the agricultural operations of Dow and Dupont would be converted into a separate company that would combine Dow Agrosciences, the current agricultural division of Dow, with Pioneer, currently an agricultural subsidiary of Dupont (1). Dow Agrosciences has 10% of the world pesticide market and 4% of the seed market, while through Pioneer, Dupont owns 21% of the world commercial seed business and 6% of the global pesticide market.

These two corporate mega-mergers would be the culmination of an aggressive process of corporate acquisitions and consolidations that occurred over the last four decades. Silvia Ribeiro, from the ETC Group, reports that in 1981 “there were more than 7 thousand companies in the world that produced commercial seeds, most of them family-owned, and none controlled more than one percent of the market; 34 years later, six multinationals control 63 percent of the global seed market and 75 percent of the global agro-toxin market. Monsanto, Syngenta, DuPont, Dow, Bayer and Basf, all originally poison manufacturers, are the six giants that control pesticides, seeds and 100 percent of agricultural GMOs. " (2)

The companies insist these mergers are necessary to achieve the economies of scale that they claim are necessary to feed a growing world population, as well as to meet the increasingly pressing challenge of climate change. But the ETC Group, a Canadian-based non-governmental organization, warns that the consolidation of agribusiness is a danger to food security and sovereignty, and that it will hinder efforts to counter climate change. "Allowing more agricultural inputs to end up in fewer hands is a recipe for disaster," the organization says in a report published in December 2015. (3)

According to Benbrook, these mergers mean for farmers fewer options when it comes to acquiring corn and soybean seeds, higher seed prices, and an increase in the use of transgenic technologies that less and less work to combat pests and weeds.

“The short-term financial performance of the new company (Dow and Dupont) will be determined by how quickly the next generation of corn and soybean seeds can be brought to market, genetically altered seeds to resist multiple herbicides. The financial squeeze on the agricultural sector will tighten as another portion of the farm's income passes to technology developers and input suppliers. There will, after all, be new profit targets and a lot of new debt to pay off. ”

According to Ribeiro, one of Monsanto's reasons for seeking partners like Syngenta is desperation. Its flagship product, the herbicide glyphosate, is no longer useful because its extensive use has led to the emergence of dozens of species of superweeds resistant to it. And on top of that the World Health Organization has identified it as a probable carcinogen. Monsanto urgently seeks access to new herbicides and then develops new transgenic crops that can resist them.

But seeds and pesticides are not the only agricultural sectors that are consolidating. Fertilizer and farm machinery companies are going the same way, and those do make big money. The global seed business is $ 39 billion and the pesticides business is $ 54 billion, according to 2013 figures. Well, compare that with the agricultural machinery, $ 116 billion, and the fertilizer, $ 175 billion. And they are also highly concentrated economic sectors: three firms control 49% of the agricultural machinery business, and in North America three fertilizer companies make up the Canpotex consortium, which controls a third of the world's supply of potash (potassium hydroxide), an essential ingredient of fertilizers.

Machine builders are expanding into territory occupied by Monsanto and its competitors. John Deere, the number one firm in the sector, has alliances and agreements with five of the six leading companies in the seed and pesticide business with a view to increasing their sales through insurance policies that condition farmers to use their seeds, agro-poisons and machinery. And meanwhile Monsanto actively collaborates with the three largest manufacturers of farm machinery, which are in addition to John Deere, the Dutch CNH and the American AGCO.

Agricultural machinery companies are also moving big into the new and growing field of so-called 'precision agriculture', which uses software, robotics, drones, global positioning systems, satellite observation and weather data. "Precision agriculture involves the control of information and its transformation into merchandise, and it is one of the high-tech tools that drives the industrialization of agriculture, the loss of local agricultural knowledge and the erosion of farmers' rights", Hope Shand, ETC Group research director, told me in an interview in 2002 (4). "With precision agriculture farmers gradually become more dependent on decision-making from outside the farm to determine input levels. For example, dictate what seed, fertilizer, agrochemicals, row spacing, irrigation, what farming techniques harvest will be used, and other requirements, "he added.

The fertilizer industry, for its part, is using the discourse of “climate-smart agriculture” to defend its interests. This supposedly innovative modality of agricultural production, which has the endorsement of the United Nations, aims to address the problem of climate change but is nothing more than a corporate deception, according to La Via Campesina, an organization that brings together tens of millions of small farmers around the world whole and flies the flag of food sovereignty (5).

The non-governmental organization GRAIN informs us that it is a corporate front to hide the interests of fertilizer manufacturers:

“The Global Alliance for Climate-Smart Agriculture, created (in 2014) at the United Nations Summit on Climate Change in New York, is the culmination of several years of effort by the fertilizer lobby group to block any action important in the area of ​​agriculture and climate change. Of the 29 founding non-governmental members of the Alliance, there are three lobbying groups from the fertilizer industry, two of the world's largest fertilizer companies (Yara from Norway and Mosaic from the United States), and a handful of organizations working directly. with fertilizer companies on climate change programs. Today, 60% of the Alliance's private sector members still come from the fertilizer industry. ” (6)

“Mega-mergers of large agribusinesses will increase costs, reduce innovation, cut options and decrease diversity. National antitrust authorities - especially in the global South - must review, enforce and strengthen antitrust laws, ”says the ETC group. "Action is urgently needed to monitor, regulate and counter corporate power so that they no longer compromise food sovereignty and climate justice."

We fully agree with Ribeiro's conclusions, “If these mergers are allowed, we are going to new oligopolies that will control seeds, varieties, pesticides, fertilizers, machinery, satellites, computer data and insurance. And that they will damage, contaminating them and in other ways, the real options for food and the climate: decentralized, diverse peasant production, with their own seeds, which are the ones who feed the majority of the population. "

Notes:
1 Charles Benbrook. "Time for a Free-Pioneer movement?" Des Moines Register, December 11, 2015. http://www.desmoinesregister.com/story/opinion/abetteriowa/2015/12/11/time-free-pioneer-movement/77114700/
2 Silvia Ribeiro. "Corporate cannibalism: What's next" La Jornada, December 26, 2015. http://www.jornada.unam.mx/2015/12/26/opinion/021a1eco
3 Group ETC. “Breaking Bad: Big Ag Mega Mergers in Play” December 15, 2015. http://www.etcgroup.org/content/breaking-bad-big-ag-mega-mergers-play
4 Carmelo Ruiz Marrero. “Towards the agropolicial state” ALAI, September 28, 2014. http://www.alainet.org/es/active/77511
5 Carmelo Ruiz Marrero. “Climate-smart agriculture, another agribusiness hoax” Agencia Tegantai, June 9, 2015. http://www.agenciaecologista.info/editoriales/799-agricultura-climaticamente-inteligente-otro-engano-del-agronegocio
6 GRAIN. "The Exxons of agriculture". September 30, 2015. https://www.grain.org/article/entries/5276-las-exxons-de-la-agricultura
* Carmelo Ruiz Marrero is a Puerto Rican journalist. He directs the Biosafety Blog and the Energy and Environment Monitor for Latin America. His new book The Great Botanical Chess Game is on sale and available through Amazon and Librería Isla. His identification on Twitter is @carmeloruiz.
Http://carmeloruiz.tumblr.com/, http://carmeloruiz.blogspot.com/, Twitter: @carmeloruiz

Common Culture


Video: How the DowDupont Merger Could Harm Us All (June 2021).