Monsanto Bites Back

By Don Quijones, Spain & Mexico, editor at WOLF STREET.

Monsanto, the U.S. agribusiness giant that controls a quarter of the entire global seed market, could soon be even bigger and more powerful than it already is, following renewed speculation over its interest in Swiss agrichemicals firm Syngenta. The logic behind the deal is clear: Monsanto ranks as the world’s largest purveyor of seeds while Swiss-based Syngenta is the world’s largest pesticide and fertilizer company.

A Monsanto-Syngenta tie-up would “deliver substantial synergies that create value for shareholders of both companies”, said Monsanto president and COO, Brett Begemann, adding that cash from these side deals would make an acquisition easier to finance. It would also be the largest-ever acquisition of a European company by a U.S. rival.

The target, Syngenta, seems somewhat less enthusiastic. It is the second time in as many weeks that Monsanto has tabled an unsolicited offer for its Swiss competitor. The first time, on May 8, Syngenta politely but firmly rebuffed Monsanto, saying that the offered price of $45 billion undervalued the company. In response to the latest offer Syngenta said a sell-off of its seeds business would not be enough to allay regulators’ concerns about the tie-up.

The 2 C’s: Consolidation and Concentration

If the deal is consummated, the two companies combined would form a singular agribusiness behemoth that controls a third of both the globe’s seed and pesticides markets, as Mother Jones reports:

To make the deal fly with US antitrust regulators, Syngenta would likely have to sell off its substantial corn and soybean seed business, as well its relatively small glyphosate holdings, in order to avoid direct overlap with Monsanto’s existing market share, the financial website Seeking Alpha reports.

By all measures you would think the global seeds market is already concentrated enough. According to Silvia Ribeiro, a researcher for the Action Group on Erosion, Technology and Concentration (Grupo ETC), never before in the long history of human agriculture and food have we faced such heightened concentration of power and ownership of the global seed industry, the primary link of the global food chain:

In 2014, just six American and European companies – Monsanto, Dupont, Syngenta, Dow, Bayer and Basf – control 100% of the GM seeds planted in the world. All of them were originally chemical manufacturers.

It wasn’t always that way. Indeed, such concentration of the seed industry is a wholly new phenomenon. Thirty-five years ago, there were thousands of seed manufacturers and not a single one of them controlled more than 1% of the global market. Fifteen years later, the top ten companies had captured 30% of the market, yet Monsanto was not among them.

Now Monsanto alone, after having acquired a huge portfolio of seed companies such as Agroceres, Asgrow, Cristiani Burkard, Dekalb, Delta & Pine and the seeds division of Cargill North America, controls 26% of the entire global market of all seeds, not just GMOs. Monsanto, second-placed Dupont, and third-placed Syngenta combined control 53% of the market.

Such concentration of ownership has granted a handful of Western corporations and the governments with which they are inseparably intertwined vast control over one of the world’s primary resources, food. And now Monsanto wants to strengthen that control.

On the Back Foot

The irony is that just weeks ago Monsanto was on the back foot. Facing an unprecedented global consumer backlash, the company decided to roll out a social media and marketing campaign in a bid to win over consumers in key international markets, including China, France, India, Argentina and Brazil.

Here’s more from Reuters:

The “discover Monsanto” campaign encourages consumers to “be part of the conversation,” ask questions and learn about the company’s genetically engineered seeds and its key herbicide products. A corresponding television advertising campaign, underway since November, declares that to Monsanto “food is more than just a meal, it’s love.”

The outreach effort comes as the company’s key products face heightened regulatory scrutiny and a consumer backlash in Monsanto’s top market, the United States. Some U.S. states are mulling mandatory genetically modified labeling laws and advocacy organizations are pressuring regulators to restrict glyphosate use.

Monsanto’s glyphosate-induced headaches began when the International Agency for Research on Cancer (IARC), a component of the UN’s World Health Organization United Nations, declared that the chemical, one of the active ingredients in Monsanto’s flagship product Roundup, is “probably carcinogenic”. Roundup is the world’s biggest selling weedkiller. According to some estimates, Roundup and Roundup Ready seeds account for as much as half of the corporation’s revenues.

Matters were not helped when Patrick Moore, a high-profile GMO advocate, botched an interview with French media outlet Canal+ in spectacular foot-in-mouth fashion (here’s the link). Moore insisted that Roundup isn’t remotely toxic, arguing that you can “drink a whole quart of it” without it hurting you. However, when invited to put his words to the test by downing a glass of the liquid weed killer, Moore replied that he was not stupid – not once but twice!

The Global Pushback

The fallout has been relentless. The company has been implicated in litigation cases as far away as China, the world’s second largest market for seeds. Even before the scandal, the Chinese government had already begun blocking GMO imports, while Russia has effectively banned all GMO products. In Germany, a number of states have called for a blanket EU-ban on Monsanto’s Roundup.

As for Latin America, one of Monsanto’s fastest growing markets, the rural resistance continues to intensify. As I reported last year in Seed Wars: Latin America Strikes Back Against Monsanto, rural communities are rising up against government legislation that would apply brutally rigid intellectual copyright laws to the crop seeds they are able to grow.

And thanks to the glyphosate scandal governments finally have reason to act. Just yesterday Colombia’s National Drug Council voted to suspend glyphosate spraying on illicit coca cultivations. According to Food & Water Watch, since 2003 Colombia and the US together have spent an estimated $100 million purchasing the chemical from Monsanto for the destruction of coca crops.

In Argentina, one of the world’s largest producers of genetically modified soy bean and corn, 30,000 Argentinean doctors and healthcare professionals signed a letter demanding the prohibition of glyphosate. As the BBC reported last year, in the northern province of Chaco, the minister of Public Health wants an independent commission to investigate cases of cancer and the incidence of children born with disabilities.

Ruthless Resourcefulness

However, even as myriad nations line up to ban Monsanto’s GM products, you can be sure that Monsanto will not take it lying down. As its recent history shows, the company is doggedly persistent. It is also ruthlessly resourceful.

For the moment everything hinges on the success of its hostile takeover of Syngenta. If the deal goes through, the company will expand its influence across myriad new markets. It will also get much closer access to Europe, a market that it had publicly (though certainly not privately) given up on in 2013. By resettling in Switzerland, Monsanto will also be able to significantly reduce its U.S. tax bill as well as hold greater sway over Brussels, which recently authorized 17 new GMOs for food and feed purposes.

According to research by Corporate Europe Observatory, no industry has lobbied the European Commission more fiercely for the passage of the EU-US trade deal (TTIP) than the agribusiness sector, which many rightly fear will open the floodgates to GMOs. In other words, growing public opposition to GMOs may not be enough on its own to stop GMO markets from growing.

As Ulson Gunnar reported in the NEO article Monsanto’s Covert War on European Food Security, Monsanto and friends continue to use covert means to expand their less popular markets, most recently launching GMO operations in war-ravaged Ukraine, which in 2013 was ranked third in global corn production and sixth in wheat production:

With the EU itself relaxing some of its regulations regarding GMOs, likely without the consent of a population increasingly conscious of the risks and actively seeking organic alternatives, biotech conglomerates hope to make GMO products spread from what will be the completely unregulated fields of Ukraine, into Europe and to become as ubiquitous and unavoidable as they are in America.

On Sunday masses of people in hundreds of towns and cities across the world turned out to vent their frustration against a company that has come to symbolize so much that is wrong with today’s world. Meanwhile Monsanto will continue to go about its business, pulling the strings of government and striving to impose its will in the world’s markets and on the world’s people. By Don Quijones, Raging Bull-Shit.

Bankers, politicians, academics, even startup guys are all lining up on the same side. Read… The “War on Cash” in 10 Spine-Chilling Quotes

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  14 comments for “Monsanto Bites Back

  1. Jerry Bear says:

    Sheesh! It seems like it is high time for some trustbusting. I dont think Monsanto can in the long run prevail against a majority of the worlds people. It would be like declaring war against the ground beneath your feet. Nonetheless, Monsanto isnt the only country that wants to create multinational corporate feudalism……..

    • Ray says:

      “Nonetheless, Monsanto isn’t the only c̲o̲u̲n̲t̲r̲y̲ that wants to create multinational corporate feudalism” ✓

      At least it will be democratic system. You don’t vote, you don’t eat.

  2. lg says:

    With time China will crush all. Either by populating it producing it or growing it!

    “The meek shall inherit the earth”

  3. Dan Romig says:

    Glyphosate is now being used by grain producers to desiccate their fields before harvest. Four days before running the combine, growers spray their fields to kill weeds and their plants in order to have an easier harvest. But in so doing, glyphosate then enters the final product (wheat, barley, oats and others). Almost every human being has it in their bloodstream.

    Dr. Stephanie Seneff has led the way in research on what this does to a person. As glyphosate gets into the digestive tract, it kills much of the beneficial bacteria and produces intestinal permeability, or ‘leaky gut syndrome’. It also chelates minerals such as aluminum, and then ‘cages’ the aluminum which goes into the bloodstream, and finally ends up in the pineal gland. Look at the correlation between when RoundUp was invented in 1970, put into mass use around 1979 and then unleashed into GMO crops in the late 1990’s, and the rise in Alzheimer’s and autism among other neurological disorders.

    Ironically, before my father and I started a conventional wheat seed genetics company in 1993, Trigen Seed LLC, he was head of R & D at Northrup King (a Syngenta subsidiary) and started the Bt corn program which entered the market in 1996 along with Monsanto’s RoundUp Ready corn and beans.

    In the 18 years we worked breeding new hard red spring wheat varieties in the traditional manner of making crosses between two different parents, we watched technology jump ahead. Now, even non GMO food sources are bred using using double haploid breeding and single seed descent technology. What that does is provide the breeder with a much more homozygous genetic structure of the first generation of seeds that are produced from crossing two different parents. This is now used in private industry (Monsanto, Syngenta, Bayer Crop Science and Limagrain to name a few), and by University’s that have Agriculture programs. We sold Trigen to Limagrain in 2010 because this technology was needed to compete and unavailable to our small family business.

    What we eat affects our health. It is practically impossible to avoid Big Ag & Big Food GMOs, antibiotics and hormones. The USDA just approved Dow’s “Enlist Duo” which combines glyphosate and 2,4-D for a new class of toxic GMOs that will soon be in your bloodstream.

  4. Mark says:

    Like the old saying goes. ” You are what you eat “.

    I’ve read that they are also growing meat in labs for human consumption. Can’t wait for that to hit the market.

  5. Paulo says:

    Patrick Moore, the goof who wouldn’t drink Roundup, is from BC. I am also a BCer. I wrote him awhile ago and told him I was ashamed he was from our fine Province and that what he was doing was terrible for people and the environment by being a spokesman/shill for Monsanto. (This was a man who started out as a founder of Greenpeace, then went on to promote open net fish farming on the west coast, and morphed his career into promoting pesticide use in food products as well as GMO). Anyway, I sent him the excerpt from today’s article and he replied. I wanted to share that reply with others.

    His reply:
    “Go fuck yourself, all of that was happening long before that French asshole ambushed me. Glyphosate is less toxic than vinegar or table salt, so go fuck yourself again.”

    I included his contact info in case others would like to respond to him as well. Judging by his response, I would imagine he has lost a few contracts and pesticide industry credibility. It would be nice if he was forced in obscurity where he cannot do any more harm.


    • Wolf Richter says:

      Thanks! He certainly has a way with words.

    • donna says:

      Given his state of mind, it appears he did drink that quart of Roundup.

      ALL the BIG farmers (all we have anymore) around here in North Dakota use GMO seed. Roundup is more abundant than rain – even in small towns and the larger communities where a German fastidiousness requires that lawns must have the appearance of green concrete with nary a stalk of corn, a sunflower, or a blade of grass any taller or shorter than its neighbor. Anyone with a lawn over 6″ or ‘weeds” receives a registered letter requiring the property owner to clean up the yard or be charged $100 an hour for someone from the village to do it for you. God forbid, anything be out of place! Lots of cancer, birth defects, chronic conditions, and metabolic disorders.

  6. interesting says:

    A Monsanto-Syngenta tie-up would “deliver substantial synergies that create value for shareholders of both companies”

    and to everyone else on the planet a big F-you….at least he’s not hiding what the whole point of the merger is.

  7. Schinzy says:

    A link to a bearish article on Monsanto with good (scientific) references:

    Neil Young’s new album is anti GMO:

    Anyone know why Monsanto was so cashflow negative in 2014?

  8. Debtserf says:

    Good piece DQ. The truth about Glyphosate and roundup is starting to leak out despite all the PR efforts. A German retail chain recently banned it from sale, and many countries are starting to take action. No wonder these guys want TTIP/TPP – gotta protect that sweet monopoly.

  9. Julian the Apostate says:

    Sounds like Mr. Moore is having a bad year. Idiot. As to Neil Young singing about non GMO that ought to be a big seller. The group Alabama said all there is to say about that fool.

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