Friday, September 09, 2016

Concentration in seeds supply causes concern

Concern is growing about the extent to which the global seeds market is dominated by a smaller and smaller number of agribusinesses. The bid by Bayer for Monsanto has caused particular concern.

Twenty years ago there were 600 independent seed companies. Most of them have now been bought out by the six big players that control 63 per cent of the global seed market: Monsanto, Syngenta, Bayer, DuPont, Dow Chemical and BASF.

That could soon be just four companies. Dow and DuPont announced a $130bn merger last year, while ChemChina is pursuing a $44bn takeover of Switzerland's Syngenta. A takeover of Syngenta would be China's biggest overseas transaction.

The European Commission has launched an in depth probe into the effect of Dow-DuPont tie up on competition. However, Dow and DuPont do not think this will affect the deal going through. They propose to split the combined company into three parts after the merger.

A Bayer takeover of Monsanto would combine the two largest cotton seed sellers in the US into a single company, responsible for almost 70 per cent of crop acreage, according to Verdant Partners, a consultancy.

Campaigners are worried about the possible impact of these mergers on biodiversity. They are concerned that the diversity of plant varieties available to farmers would shrink even further.

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