What an understatement in face of such an explosive decision! “Quite a lot of change in a very short time”: The EU Competition Commissioner Margre Vestager commented on approval of EU Commission for Megafusion between Bayer and Monsanto, pharmaceutical and Agrarchemiekonzern and seed giant.
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The fact that EU would approve merger was expected. With approval, takeover seems to be as good as sealed. It is a clear signal to competition authorities of those countries that have not yet taken ir decision. But above all, it is not good news for sustainability, for democracy – and especially for farmers. Too much market power is damaging. That teaches experience, especially in agriculture.
But market power of newly emerging group is enormous, because current elephant wedding – and it was played by Vestager – marks only spectacular culmination of a whole series of corporate mergers in global agriculture, which in recent months have been waved through on an already highly concentrated market. Previously, US companies Dow and DuPont/pioneer joined toger and Swiss agricultural company Syngenta merged with China’s ChemChina.
One third of seed market for a company
In end, BASF is included, now only four large agricultural giants remain. Bayer-Monsanto alone will dominate almost one third of commercial seed market as largest supplier; The largest three toger 61 percent. The pesticides are even 71 percent.
Although EU Commission has put in place strict conditions on 51 billion euro business. In order to maintain competition, leverkuseners must, for example, make part of ir research on highly effective Unkrautvernichtern to BASF, as well as certain branches of ir seed business. But critics consider se limitations to be inadequate in current market situation. In case of vegetable seed, for example, Monsanto has bought so many breeders worldwide in recent years that company’s strong position does not appear to be at risk.
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The merger is threatening, above all, in long term, given technological developments that all Agrarkonzerne are currently plunging into with billions of investments. They know for a long time that ir previous methods of increasing yield by chemistry will no longer work in foreseeable future, and that population is increasingly accepting m, as y lead to loss of species, water pollution and resistant Pests. The use of glyphosate is increasingly less allowed, Neonikotinoide are probably banned – corporations need new ideas for business. That is why y are intensively researching digital precision farming, as y call it, which is intended to reduce use of pesticides and fertilizers using sensors. They test field robots and develop new genetic methods of plant breeding.
© Moritz Küstner Christiane Grefe reporter in capital editor, time to author page
Monsanto has purchased many start-ups in recent years for all se innovations. Bayer, for its part, has an enormous advantage over pesticides. Both toger can expand ir position as first mover of beautiful new agricultural landscape, and this is aim of merger.
It will perhaps make common industrial cultivation system a little more sustainable – but above all it should be preserved. In future, Bay-Santo as well as or companies will sell everything from a single source: Seed, Argarchemie, field data and cultivation knowledge, individually tailored to every farmer and every square metre of his farm. But that will drive farmers even stronger than y are now, depending on solutions, products and prices of large companies. At same time, it is becoming increasingly close to alternatives such as organic farming. In meantime, companies are also relying on many of its approaches, because y are also exploring biological means or natural root systems in soil in ir pesticide-soaked cul-de-sac.
What world do we want to live in?
In particular, problems of industrial agriculture show that market power, shareholder value and economies of scale have not only led to more monocultures in field, but also in ir minds. Oligopolies are not error-friendly – if you are mistaken, n mistakes will be raised in a big way. Rarely do y promote what agriculture, which is struggling with water scarcity, water poisoning and soil problems as well as challenges of climate change, currently needs most: experimentation, adaptation to local natural resources and Cultures. This is all more true if Bayer-Monsanto wants to extend common cultivation system to developing countries as well. Where vast majority of people as small farmers have survived from one hectare rar than live, re is a need for quite different, simpler and more diverse approaches.
For such reasons, Margre Vestager has been able to see that European competition law alone currently covers such dimensions of merger far too little and that or parts of EU Commission are also in demand to intervene now with rules. Because it is about state of environment as well as a healthy diet for all, group wedding is an even bigger, “extremely important debate”, said Vestager; “In which society we want to live”.
Probably true. Today’s decision makes it even more important that this debate on an existential issue is now widely held.
