Bayer’s acquisition of Monsanto is rumored to be green-lighted by the U.S. Department of Justice. A number of outlets have reported on the story. Will this takeover benefit U.S. farmers? Share your thoughts and see our exclusive Ag Nook poll results below.
Farm Futures ran a Bloomberg story by Simon Casey titled, “DOJ approves of Bayer’s takeover of Monsanto”, noting the DOJ action removes last major regulatory hurdle Bayer-Monsanto merger.
Monsanto shares surged after the Wall Street Journal reported that the U.S. Department of Justice decided to approve its $66 billion takeover by Bayer AG, removing the last major regulatory obstacle to the completion of the biggest deal in the seeds and crop-chemicals industry.
An agreement in principle has been brokered between the two companies in recent days, the newspaper reported, citing people familiar with the matter. That marks a breakthrough for the review process, as just last month, Justice Department officials weren’t satisfied with Bayer’s plan because of concerns that the transaction could hurt competition, two people familiar with the matter told Bloomberg News at the time.
In its review of the Bayer-Monsanto merger, the Justice Department is looking at horizontal antitrust issues, or competition in the same market, as well as vertical competition, or issues along supply chains, one of the people said.
Successful Farming carried a Reuters story about the acquisition, titled, “Bayer Reaches Deal With U.S. For Approval To Buy Monsanto”. The focus in this piece was the arrangement reached to mitigate anti-trust concerns.
The Justice Department reached an agreement in principle with Bayer and Monsanto in recent days, the Journal said, citing people familiar with the matter. Under the deal, Bayer agreed to sell additional seed and treatment assets to BASF SE and agreed to make concessions related to digital agriculture, the Journal said.
The deal reduces competition for sales of seeds and chemicals to farmers struggling with low crop prices, raising the risk for price gouging, said Wenonah Hauter, executive director for Food & Water Watch, an advocacy group.
“The Justice Department’s paltry divestment approach does little to address the extreme control the merged firm will have over farmers’ data, genetics, biotechnology traits or the associated agrichemical industry,” she said.
Benefit U.S. Farmers
With these anti-trust hurdles cleared, it begs the question, will this coming together of two agribusiness giants be good for U.S. farmers?
A recent survey conducted by Friends of the Earth (FOE) showed significant concerns about this takeover from farmers. The results showed an overwhelming majority of surveyed farmers are concerned about the proposed Bayer-Monsanto merger and believe it will have a negative impact on independent farmers and farming communities. A cautionary note about those surveyed from the methodology note, the data and sample size are especially strong for organic farmers and for small family farmers.
WASHINGTON, D.C. – An overwhelming majority of surveyed farmers are concerned about the proposed Bayer-Monsanto merger and believe it will have a negative impact on independent farmers and farming communities, a poll released today has found.
According to the poll, of the farmers who responded:
- 93.7 percent are concerned about the proposed merger of Bayer and Monsanto (82.8 percent are very concerned/10.9 percent somewhat concerned);
- 93.7 percent of farmers are concerned that the proposed Bayer-Monsanto merger will negatively impact independent farmers and farming communities (83.9 percent are very concerned/9.8 percent somewhat concerned);
The farmer’s top three concerns of the merger are:
- 91.9 percent of farmers are concerned that the merged company will use its dominance in one product to push sales of other products (79.6 percent very concerned/12.3 percent somewhat concerned);
- 91.7 percent of farmers are concerned that Bayer/Monsanto will control data about farm practices (79.5 percent very concerned/12.2 percent somewhat concerned)
- 89.0 percent of farmers think the merger will result in increased pressure for chemically dependent farming (77.1 percent very concerned/11.9 percent somewhat concerned).
The poll also found a high level of concern amongst farmers surveyed that the merged company will control data about farm practices, will increase prices, diminish quality, choice and seed varieties including availability of regionally adaptive seed, which farmers identified as critical given increasing climate variability.
Join others in the Ag Nook community and share your thoughts about how this transaction will impact U.S. farmers. After completing the Poll you will see the cumulative results.
Image Courtesy FOE