(TFC) – The Bayer – Monsanto merger, announced last week, will no doubt be good for shareholders in the short term, with the sale price of seed and GMO giant Monsanto ending up at $66 billion, or $128 cash for each share. But the result for farmers across the globe will likely be far less rosy.The Bayer – Monsanto merger deal, which took months of negotiations to finalize, will create the largest agribusiness in the world. Bayer, mostly known for their aspirin and other pharmaceutical products (including, long ago, heroin) are actually an agriculture product giant in and of themselves, with a large chunk of their yearly profits being from the sale of agricultural chemicals.
Monsanto, as many know, is the company that invented the weed killer Round-Up, and with it, Round-Up Ready Seed, which has been genetically engineered to accept and be resistant to… well, Monsanto’s own product. Monsanto is also a leading developer of GMO, or genetically modified organisms, in general. A subject of constant criticism is the company’s development of so-called “Terminator Seeds,” or strains of commodity crops that will not produce their own seed. This forces farmers to keep coming back to Monsanto for their seeds rather then cultivating crops from seeds those crops would naturally produce. This creates a cycle of dependency on the company, like a person with an addiction who must keep going back to that Bayer “heroin.”
The Monsanto – Bayer merger not only changes the business world. The ripple effects will thunder down on farmers, and eventually, to kitchen tables around the world. In much of the world, the merger is seen as an attempt to monopolize agriculture and change the way many people cultivate and consume food. One need look no further then the Indian subcontinent to see some of this hostility.
— debarshi chakravorti (@picks78) September 14, 2016
Monsanto is an unpopular firm even in India, and many agricultural specialists there are concerned that the merger will lead to even fewer options for the often impoverished Indian farmer. A piece in DW on the effects of the Monsanto – Bayer merger in India quoted Prabhakara Rao, President of the National Seed Association of India, as saying:
“It will lead to concentration of power and will result in market distraction. This is the third such merger of seed majors in recent times. This will leave only three players in the global market and will have a cascading impact on Indian agriculture.”
The deal is especially unwelcome in India due to the disturbing trend of farmers committing suicide. After the introduction of GMO cotton seed, India began suffering a massive increase in suicide among farmers – some 250,000 in the last decade. The developing consensus is that these cotton farmers, who have never been wealthy in the first place, have been lashed into a cycle of debt by being forced to buy Monsanto seed and pesticide every year. Monsanto controls as much as 95 percent of the cotton seed business on the subcontinent.
The new Monsanto – Bayer merger gives the new, Bayer owned entity more than a quarter of the world market in seeds and pesticides. This, of course, means that up to 25 percent of all crops will be indirectly controlled by a single corporate entity, limiting options in agriculture around the globe. This merger isn’t the first this year, either. The St. Louis Post Dispatch reports:
“The deal follows a wave of consolidation in the agrichemical industry, partly touched off by Monsanto’s failed bid last year to buy Swiss rival Syngenta. After rebuffing Monsanto’s overtures, Chinese state-owned company ChemChina announced a deal to buy Syngenta. Meanwhile, Dow and Dupont are in the midst of a tie-up.”
As the major players continue to merge, the options for the individual farmer and consumer dwindle. We have seen that this is a dire prospect for India, but it will certainly reverberate elsewhere, especially in the developing world, where money and options are already both in short supply.
Around the world, however, and especially in Europe, some Monsanto products are banned entirely – including, curiously, in Germany, where the new post merger Monsanto parent Bayer is based. The backlash against GMO products is loud and lasting, with Monsanto becoming the poster child of the “evil corporation.” The suicide rates in India and the fact that several of their products are known to cause cancer doesn’t help the company in the court of public opinion. Indeed, things have become so bad for the company that there is an actual court of public opinion being set up at The Hague in October, accusing the company of crimes against humanity and ecocide.The Monsanto – Bayer merger, and the other mergers, bring up more questions than can be answered. For example, if the TPP is signed with the legal provisions intact, could these mega-companies sue to allow their products in countries that institute bans? What options are left to countries, and individual farmers, if these companies transition entirely to Terminator seed or other GMO products that force them to continue doing business with one company? What effects will these products have on the ecosystem as a whole when they blanket the entire world?
The ever-shrinking options for the individual farmer and consumer, and the concentration of wealth and resources in fewer and fewer hands, can only be a net negative to the global community. Far from being a positive, the Monsanto – Bayer merger sounds a death knell to agriculture as we know it – and not in a good way.
[Featured Image via Gyrostat/Wikimedia Commons]