sábado, enero 16, 2016

Monsanto + Syngenta: Agribusiness Giants Get Even Bigger


By Carmelo Ruiz


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.”

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