Submitted by Charlie on
Last week the US Justice Department (DOJ) gave the green light for Monsanto's $1.5 billion takeover of the world's largest cotton seed company, Delta & Pine Land (D&PL) -- the company that has long vowed to commercialize Terminator seeds (more on that below). The so-called "anti-trust" regulators approved the deal with a number of conditions. For instance, Monsanto must sell Stoneville, one of its largest cotton seed holdings, to multinational Bayer. The company must also agree to license its biotech traits to major competitors like Syngenta and Dupont. In a sense, the anti-trust regulators are telling Monsanto that they have to be better about sharing their oligopoly seed market with other multinational Gene Giants. Ultimately, it means more genetically engineered crops, fewer choices and higher prices for farmers and consumers -- no matter how the pie is sliced. Also, with the acquisition of D&PL's cotton business, Monsanto will be working hard to insure that every cotton seed it sells contains some of Monsanto's patented biotech traits. Millions of cotton farmers will be under increased pressure worldwide to accept genetically modified (GM) cottonseed.
Reacting to the takeover approval, John Boyd, president of the US-based National Black Farmers Association, told Reuters:
"This is a sad deal for us. We wanted the DOJ to step up to the plate," said Boyd. "Now we producers will be faced with astronomical prices on seeds with Monsanto taking control of the whole industry."
Here's what ETC Group wrote about the takeover when it was first announced in August 2006.
One sure sign that DOJ's conditional approval is a mighty good deal for Monsanto is that Dupont (the world's second largest seed company) is not pleased. According to Reuters, Dupont "may pursue litigation to block the deal."
With the takeover of D&PL, not only is Monsanto the global king of cotton seed, it's by far the largest seed company in the world -- with pro forma revenues $1.6 billion dollars greater than its closest competitor -- Dupont (Pioneer Hi-Bred).
With the takeover of D&PL, we estimate that Monsanto will account for about 23% of the proprietary seed market worldwide. (According to Context Network, the 2006 proprietary seed market was valued at $19,600 million)
The astonishing thing is that Monsanto wasn't even considered a seed company 10 years ago.
And Monsanto's buying binge continues. Last year, Monsanto created a holding company called International Seed Group Inc. (ISG), in order to purchase regional seed companies around the world. In January, ISG bought a small French seed company, Poloni Semences. Just last month, ISG announced it was buying Western Seed, a Dutch hybrid vegetable seed company.
With Monsanto's market share rapidly approaching one-quarter of the world's proprietary seed market, farmers (and ultimately consumers) are already seeing fewer choices and higher prices. Not only for cotton, but for major field crops (i.e. corn and soybeans) as well as vegetables -- all seed sectors where Monsanto dominates. Monsanto's market share should set off alarm bells because seeds are the first link in the food chain. Quite simply, it's a dangerous proposition to have so much of the world's commercial seed supply in the hands of a single corporation.
Delta & Pine Land is notorious for its vow to commercialize Terminator seed technology -- plants that are genetically modified to render sterile seeds at harvest -- forcing farmers to return to the commercial seed market every year. With the takeover of Delta & Pine Land, Monsanto has acquired a research program devoted to commercializing Terminator seeds, as well as US, European and Canadian patents on genetic seed sterilization technology.
Monsanto's former CEO, Robert Shapiro, publicly pledged in 1999 that his company would not commercialize sterile-seed technology. But the company's revised 2005 pledge states that the company will not "commercialise sterile-seed technologies in food crops" (our emphasis) - suggesting that it would use Terminator seeds in non-food crops. The pledge also states that "Monsanto people constantly reevaluate this stance as technology develops." The pledge is available here.
In February 2006 Diane Herndon, Monsanto's Director of Public Policy, wrote to the international Ban Terminator Campaign: "We apologize for any confusion caused by the added language "in food crops" that appeared in the discussion of Genetic Use Restriction Technologies (GURTs) in our last Pledge Report. We stand by our commitment to not use genetic engineering methods that result in sterile seeds. Period." Although Herndon assured us that the company "would remove the confusing language" -- we note that it has not been removed to date. The company's 2005 pledge also makes clear that the company does not rule out future development of the technology and allows the company to change its position at any time. Not-so-reassuring. See correspondence here.
The ambiguity about Monsanto's role in commercializing Terminator seed is especially relevant because in March 2006 governments meeting at the biennial meeting of the Convention on Biological Diversity unanimously reinforced and strengthened the United Nations' de facto moratorium on Terminator seed technology. Go here for details.