FacebookTwitterGoogle+RedditEmail

Monsanto + Syngenta: Agribusiness Giants Get Even Bigger

by

A merger between agricultural biotech giants Monsanto and Syngenta is becoming likelier by the minute. The proposed merger has generated much commentary and speculation in the business world as well as among anti-GMO activists since the resulting corporation would control 45% of the global seed market and 30% of the agrochemical market (1).

In 2015 the US-based Monsanto tried to buy Syngenta twice, and was twice spurned by the European corporation. But Monsanto is not the only suitor. Syngenta has also been courted with similar buyout bids by Germany’s BASF and Asian corporate colossus ChemChina.

For Monsanto, getting Syngenta’s management to agree to this transatlantic deal is more important than ever in light of the November 2015 merger agreement between two US chemical and agribusiness giants: Dow and Dupont. The resulting behemoth will be split into three companies, with one of them specializing in farm technologies, combining the agricultural businesses of both. Dow Agrosciences, Dow’s agricultural division, has 10% of the world agrochemical market and 4% of the commercial seed market. And Dupont has, through its Pioneer subsidiary, 21% of the world commercial seed market and 6% of the agrochemical market.

These two mergers would mark the culmination of an aggressive process of corporate consolidations and acquisitions that has been four decades in the making. Back in 1981 there were over 7,000 seed companies, most of them family-owned, and none controlled over 1% of the market. Nowadays, six transnational corporations own 63% of the global seed market and 75% of the agrochemical market. The Big Six are Monsanto, Dow, Dupont, Syngenta, Bayer and BASF.

These corporations insist that their mergers are necessary in order to achieve the economies of scale needed to feed a growing world population and to address the ever more urgent challenge of climate change. But the Canada-based ETC Group begs to differ: “Ag mega-mergers threaten to undermine the basis of our food supply and jeopardize efforts to build climate resilience. Allowing more farm inputs to fall into fewer hands is a recipe for disaster.”

According to agricultural scientist and analyst Charles Benbrook, these mergers mean that farmers will have less choice when procuring corn and soy seed, higher seed prices, and an increase in the use of genetic engineering technologies that are ever less effective in dealing with weeds and pests. (2)

“The near-term financial performance of the new company will be determined by how fast the next generation of corn and soybean seeds can be brought to market, seeds that are genetically engineered to resist multiple herbicides”, says Benbrook. “The farm-sector financial squeeze will tighten, as another chunk of net farm income is passed on to the technology developers and input suppliers. There will be, after all, new profit targets and lots of new debt that needs servicing.”

One of Monsanto’s main motivations for finding a partner real fast is the fact that its flagship product, glyphosate (brand name: Roundup) is reaching the end of its useful commercial life. Roundup is the most lucrative agrochemical in history. In the United States alone, the use of glyphosate on corn and soy increased twenty-fold from 1995 to 2013. This growth has been possible thanks to Monsanto’s patented Roundup Ready crops, genetically engineered to resist this particular herbicide. This technology combination allows the corporation to sell both the chemical and the seed as a single integrated package.

“But after two decades of relentless Roundup-based warfare, glyphosate- resistant ‘superweeds’ are proliferating and Roundup Ready crops are choking in weed-infested fields”, says the ETC Group. “In the U.S., farmers now face nearly 100 million acres of herbicide-resistant weeds in 36 states. Worldwide, at least 24 species of weeds are now glyphosate-resistant.”

Monsanto ran into further trouble in March 2015 when the World Health Organization declared that glyphosate is a probable human carcinogen. Two months later, the International Society of Doctors for the Environment, based in Switzerland, issued an appeal to the European governments, “to immediately and permanently ban, with no exceptions, the production, trade and use in all the EU territory of glyphosate-based herbicides.” (3)

Seeds and agricultural poisons are not the only farm business sectors witnessing accelerated corporate concentration. Fertilizer companies and farm machinery manufacturers are also in the game, and they move vastly greater sums of money. Whereas the global seed and agrochemical businesses each have $39 billion and $54 billion markets respectively, the global farm machinery market is worth $116 billion and the fertilizer market $175 billion. Three firms control 49% of the farm machinery market, while in the fertilizer sector, three North American companies own the Canpotex consortium, which controls one third of the world market of potash, an essential ingredient for fertilizer.

Farm machinery makers are inching in on turf controlled by Monsanto and its peers. John Deere, the sector’s undisputed leader, has joint ventures with five of the Big Six seed and agrochem companies. Meanwhile Monsanto has collaborations with the three top machinery firms, which apart from John Deere are Holland’s CNH, and the US-based AGCO.

The farm machinery business is buying big into “precision farming”, which relies on software, robotics, GPS, satellite monitoring, climate data, and even drones.

“The goal is to sell a platform for mapping and monitoring weather, pests and soils throughout a farm’s entire growing area – Monsanto calls them ‘paid acres’ and the company is targeting 300-400 million paid acres across the US, Canada, Brazil, Argentina, Western and Eastern Europe by 2025”, says the ETC Group. “Big Ag’s digital platform aims to be the corporate command and control center for every ag input decision – crop, seed variety, soil, seed, pesticide, fertilizer, irrigation, machinery, even crop insurance.”

University of Wisconsin professors Steven Wolf and Spencer Wood have warned that precision farming would legitimate chemical-based agriculture in an era of rising environmental awareness: “Precision farming supports further integration of on-farm activity into a coordinated system of industrial manufacture.” (4)

Also ahead of the curve was the ETC Group, which until 2001 was called RAFI. “Precision farming technology reinforces the uniformity and chemical-intensive requirements of industrial agriculture”, warned RAFI back in 1997. “It is an industrializing technology that builds further links of dependency between the farmer, the agrochemical industry and off-farm information providers.” (5)

Meanwhile, the fertilizer industry is taking up the discourse of “climate-smart agriculture” (CSA) in order to counter criticism of its product’s environmental impact and contribution to climate change. According to the United Nations’ Food and Agriculture Organization, “CSA is an approach to developing the technical, policy and investment conditions to achieve sustainable agricultural development for food security under climate change.” (6)

But international civil society is not buying it. In September 2015 dozens of organizations signed on to an open letter urging governments to refrain from endorsing CSA in the upcoming COP 21 climate change conference in Paris.

“‘Climate-Smart Agriculture’ may sound promising, but it is a politically-motivated term. The approach does not involve any criteria to define what can or cannot be called ‘Climate Smart’. Agribusiness corporations that promote synthetic fertilisers, industrial meat production and large-scale industrial agriculture – all of which are widely recognised as contributing to climate change and undermining the resilience of farming systems – can and do call themselves ‘Climate Smart’. CSA claims to include all models of agriculture. However it lacks any social or environmental safeguards and fails to prioritize farmers’ voices, knowledge and rights as key to facing and mitigating our climate challenges. It therefore actually threatens to undermine agroecological approaches as defined by practitioners, while endangering the future development and upscaling of such approaches.” (7)

According to the Europe-based non-governmental organization GRAIN, climate smart ag is little more than a front for the fertilizer business:

“The Global Alliance for Climate Smart Agriculture, launched (in 2014) at the United Nations Summit on Climate Change in New York, is the culmination of several years of efforts by the fertiliser lobby to block meaningful action on agriculture and climate change. Of the Alliance’s 29 non-governmental founding members, there are three fertiliser industry lobby groups, two of the world’s largest fertiliser companies (Yara of Norway and Mosaic of the US), and a handful of organisations working directly with fertiliser companies on climate change programmes. Today, 60% of the private sector members of the Alliance still come from the fertiliser industry.” (8)

The critics of corporate industrial agriculture affirm that socially just and scientifically sound alternatives to feed the world and counter climate change do exist. These are grouped under the concept of food sovereignty, which was formulated by La Via Campesina, an organization that represents millions of small farmers worldwide. The ETC Group advises that “To move us all toward food sovereignty, the world needs a new configuration of true innovators, including smallholder producers and public researchers – who are not undermined by spineless regulators.”

Carmelo Ruiz is a Puerto Rican author and journalist. He directs the Latin America Energy and Environment Monitor, runs a bilingual blog on journalism and current affairs, and is a member of the directive commission of the Puerto Rico Socialist Front. His Twitter ID is @carmeloruiz.

More articles by:

CounterPunch Magazine

minimag-edit

bernie-the-sandernistas-cover-344x550

zen economics

January 23, 2017
John Wight
Trump’s Inauguration: Hail Caesar!
Patrick Cockburn
The Rise of Trump and Isis Have More in Common Than You Might Think
Binoy Kampmark
Ignored Ironies: Women, Protest and Donald Trump
Gregory Barrett
Flag, Cap and Screen: Hollywood’s Propaganda Machine
Gareth Porter
US Intervention in Syria? Not Under Trump
L. Ali Khan
Trump’s Holy War against Islam
Gary Leupp
An Al-Qaeda Attack in Mali:  Just Another Ripple of the Endless, Bogus “War on Terror”
Norman Pollack
America: Banana Republic? Far Worse
Bob Fitrakis - Harvey Wasserman
We Mourn, But We March!
Kim Nicolini
Trump Dump: One Woman March and Personal Shit as Political
William Hawes
We Are on Our Own Now
Martin Billheimer
Last Tango in Moscow
Colin Todhunter
Development and India: Why GM Mustard Really Matters
Mel Gurtov
Trump’s America—and Ours
David Mattson
Fog of Science II: Apples, Oranges and Grizzly Bear Numbers
Clancy Sigal
Who’s Up for This Long War?
Weekend Edition
January 20, 2017
Friday - Sunday
Paul Street
Divide and Rule: Class, Hate, and the 2016 Election
Andrew Levine
When Was America Great?
Jeffrey St. Clair
Roaming Charges: This Ain’t a Dream No More, It’s the Real Thing
Yoav Litvin
Making Israel Greater Again: Justice for Palestinians in the Age of Trump
Linda Pentz Gunter
Nuclear Fiddling While the Planet Burns
Ruth Fowler
Standing With Standing Rock: Of Pipelines and Protests
David Green
Why Trump Won: the 50 Percenters Have Spoken
Dave Lindorff
Imagining a Sanders Presidency Beginning on Jan. 20
Pete Dolack
Eight People Own as Much as Half the World
Roger Harris
Too Many People in the World: Names Named
Steve Horn
Under Tillerson, Exxon Maintained Ties with Saudi Arabia, Despite Dismal Human Rights Record
John Berger
The Nature of Mass Demonstrations
Stephen Zielinski
It’s the End of the World as We Know It
David Swanson
Six Things We Should Do Better As Everything Gets Worse
Alci Rengifo
Trump Rex: Ancient Rome’s Shadow Over the Oval Office
Brian Cloughley
What Money Can Buy: the Quiet British-Israeli Scandal
Mel Gurtov
Donald Trump’s Lies And Team Trump’s Headaches
Kent Paterson
Mexico’s Great Winter of Discontent
Norman Solomon
Trump, the Democrats and the Logan Act
David Macaray
Attention, Feminists
Yves Engler
Demanding More From Our Media
James A Haught
Religious Madness in Ulster
Dean Baker
The Economics of the Affordable Care Act
Patrick Bond
Tripping Up Trumpism Through Global Boycott Divestment Sanctions
Robert Fisk
How a Trump Presidency Could Have Been Avoided
Robert Fantina
Trump: What Changes and What Remains the Same
David Rosen
Globalization vs. Empire: Can Trump Contain the Growing Split?
Elliot Sperber
Dystopia
Dan Bacher
New CA Carbon Trading Legislation Answers Big Oil’s Call to Continue Business As Usual
FacebookTwitterGoogle+RedditEmail