$63 billion Bayer-Monsanto merger approved
Bayer, the German pharmaceutical and life sciences multinational, has bought US agribusiness Monsanto in a $63 billion deal after receiving approval from antitrust regulatory authorities. The US Department of Justice required Bayer to sell some of its crop science assets to BASF as a condition of approving the merger.
In a press release, Bayer said, “We are aware of and accept the heightened responsibility that a leadership position in agriculture entails.” (Read more here.) Meanwhile, Hugh Grant, Chairman and outgoing CEO of Monsanto said, “I am proud of the path we have paved as Monsanto and look forward to the combined company helping move modern agriculture forward.” (Read more here.)
Some farmers expressed concern that the merger could lead to higher prices. Farmer Clay Govier said, “They’re locking in their profit and they’re cornering the market by getting bigger, not by creating new products.” (Read more here.)
Writing in the Guardian, John Vidal estimates that Bayer will now control “...nearly 60% of the world’s supply of proprietary seeds, 70% of the chemicals and pesticides used to grow food, and most of the world’s GM crop genetic traits, as well as much of the data about what farmers grow where, and the yields they get.” (Read more here.)
Read the full story in Bloomberg here. You may be interested in the FCRN’s coverage of the paper Monopoly power in food corrodes choice and resilience and the recent Sainsbury’s-Asda merger. See also the Foodsource chapter An overview of food system challenges.
While some of the food system challenges facing humanity are local, in an interconnected world, adopting a global perspective is essential. Many environmental issues, such as climate change, need supranational commitments and action to be addressed effectively. Due to ever increasing global trade flows, prices of commodities are connected through space; a drought in Romania may thus increase the price of wheat in Zimbabwe.