Farmers Union and others Justice Department to challenge Dow-DuPont merger
The American Antitrust Institute, Food & Water Watch and the National Farmers Union today urged the Justice Department’s Antitrust Division to challenge the proposed merger of Dow Chemical Co. and DuPont Co.
In a letter sent today to Principal Deputy Assistant Attorney General Renata Hesse, the three groups said the proposed merger “would create the largest biotechnology and seed firm in the U. S. … further consolidate an already highly concentrated biotechnology industry and would likely curtail innovation, raise prices, and reduce cultivation choices for farmers, consumers and the food system.”
AAI, FWW, and NFU urge the DOJ to critically review the implications of the pending deal.
The letter outlines three areas of concern: eliminating head-to-head competition in the corn and soybean markets, reducing competition for innovation, and creating a large, integrated “platform” of traits, seeds, and chemicals that would make it harder for smaller biotechnology rivals to compete.
“The current rumored or announced deals — including Dow-DuPont, ChemChina-Syngenta, and Bayer-Monsanto — would be a third wave of consolidation,” the groups said in a news release.
“Two previous merger waves eliminated the majority of small to medium-sized biotechnology R&D firms to create the Big Six — Monsanto, Syngenta, Bayer, DuPont, Dow and BASF,” they added.
The proposed merger would create “a powerful duopoly between Dow-DuPont and Monsanto,” the groups said.
“Together, the two companies would control 76 percent of the market for corn and 66 percent of the market for soybeans, giving them the power to charge farmers higher prices and effectively decide which seeds farmers could plant.”
“Seed costs are the highest input expense for farmers. While some of the cost can be attributed to more sophisticated technology, we have seen time and again that consolidation and market restructuring has increased the cost of crop inputs. In a lagging farm economy with multi-year trends of low commodity prices, additional cost increases for crop inputs could cripple a lot of family farms in this country,” said NFU President Roger Johnson.
“The Department of Justice must block this biotechnology mega-merger that would raise farmers’ prices and severely limit the choices for farmers, consumers and rural communities,” said Food & Water Watch executive director Wenonah Hauter.
“Today’s wave of agribusiness and food company mega-mergers is surrendering our food system to a corporate cabal that thwarts our efforts to build an fair and healthy food system.”
–The Hagstrom Report