Global enterprises dominate commercial agriculture

Wednesday, March 11, 1998 - 11:00

Global enterprises dominate commercial agriculture

According to the United Nations Conference on Trade and Development, global mergers and acquisitions accounted for a record US$275 billion or 79% of all global foreign direct investment in 1996.

Rural Advancement Foundation International has been monitoring alliances and mergers in the seed industry for two decades. Commercial plant breeding and seed sales are no longer the domain of small breeders and regional companies; they are now clearly dominated by agrochemical/pharmaceutical companies.

The top 10 seed companies control about 40% of the global seed market, valued at approximately US$15 billion.

The top 10 agrochemical corporations accounted for US$25.1 billion, or 82% of all agrochemical sales in 1996. Global agrochemical sales were US$30.5 billion in 1996, up more than 15% since 1994.

Over the past 18 months, Monsanto has invested nearly US$2 billion in seed company and related acquisitions. Monsanto has an estimated 30% market share in the Brazilian maize seed market.

In January 1997, Monsanto took a giant bite out of the hybrid maize seed market with the US$1.2 billion acquisition of Holdens Foundation Seeds. An estimated 25-35% of the maize acreage planted in the US is based on germ plasm developed by Holdens.

According to industry analyst Dain Bosworth, Monsanto's goal is to get its bio-engineered seed products on at least half of the 16 million maize hectares that Monsanto now has gained access to by acquiring major seed companies.

In August 1997, DuPont (US) acquired 20% of Pioneer Hi-Bred, the world's largest seed company, for US$1.7 billion. The two companies will jointly invest US$400 million in an agricultural research effort and form a new company, Optimum Quality Grains.

AgriBiotech, a US-based seed company founded in 1995, wants to control 45% of the market in forage and turf grass seed by the year 2000. AgriBiotech has made 14 acquisitions of seed companies since 1995 — with more pending.

The company says that its takeovers would not have been so lucrative without changes in US plant breeders rights and patenting laws that put limits on farmers' ability to save and resell proprietary seed.

[From Pesticide Action Network North America Updates Service.]