Guest Opinion

Monsanto Takeover of Montana Firm Could Backfire for Farmers

By Kristina Hubbard, Guest Writer, 7-23-09

An international trend in agriculture hit Montana’s plains last week. A multinational known for its dominance of the seed industry purchased WestBred LLC, a Montana-based cereal grain company that breeds seed products for markets throughout the U.S.

Monsanto’s purchase of WestBred didn’t come as a surprise given the rapid consolidation of the seed industry. In fact, the seed industry is one of the most concentrated in agriculture, with three firms controlling nearly 50 percent of the global market. Monsanto is the dominant firm in the industry and has effectively captured the market for most major crops, including corn, soybeans, cotton, and vegetables. It’s built this market power through acquisitions and mergers that should raise eyebrows at the Department of Justice.

Acquiring WestBred makes Monsanto’s market goals pretty clear: gain control of yet another major crop – wheat – and introduce more expensive, genetically engineered varieties that will yield more profits.

Troubling trends have emerged with Monsanto’s numerous seed company acquisitions. For example, this year marked a major resurgence in demand for conventional (non-genetically engineered) soybeans. But the supply wasn’t there to meet demand. As a result, farmers who wanted to plant conventional soybean seed instead paid for expensive varieties with genetically engineered traits.

To be sure, many farmers enjoy Monsanto’s seed technologies. It’s understandable that the rapid adoption of genetically engineered soybeans and corn led to less production and distribution of conventional varieties. But that’s only one part of the story.

The more seed companies Monsanto controls, the more seed availability – i.e., which varieties are sold – becomes a function of Monsanto’s shareholders’ interests, not those of farmers.

As choice diminishes, the cost of Monsanto’s seed steadily increases. This year, farmers reported paying historic prices for seed corn, a 30 percent increase over last year’s prices, even with commodity prices for corn dipping dramatically. The reason? Monsanto’s genetically engineered traits are planted on more than 80 percent of U.S. corn acreage. With this level of market share, the market no longer regulates prices – the industry leader does.

Monsanto says WestBred’s genetics will be used to develop genetically engineered traits in wheat, the technology that catapulted Monsanto into the No. 1 position in seed. (In 2008, its proprietary traits were also in more than 90 percent of U.S. soybean, cotton, and sugar beet acreage.)

Monsanto attempted to commercialize genetically engineered wheat five years ago but abandoned these efforts due to market rejection abroad. Farmers – both those who support and reject advancements in biotechnology – can’t dispute the economic risk in introducing a crop that customers do not want. Seeing this risk, the 2003 Montana State Legislature overwhelmingly passed then-State Senator Jon Tester’s Joint Resolution that stated, “the introduction of genetically engineered wheat and barley for commercial production must be carefully timed so that it occurs only when there is acceptance of these crops by Montana’s major customers.” More recently, a leading grain market economist at Iowa State University warned that commercializing genetically engineered wheat could result in the U.S. losing one-third to one-half of its wheat exports.

But even if export markets decide one day to accept genetically engineered wheat, the fear that Monsanto will reduce seed options that farmers currently rely on is very real.

This is the second time this year Monsanto has hit the front pages of Montana newspapers. In March, as many of us remember, Monsanto dispatched representatives to Montana to urge members of the Senate Agriculture Committee to kill a bill that would have protected the property and privacy rights of Montana farmers if investigated by Monsanto for seed patent infringement. Within two weeks of Monsanto wining and dining some of the committee members, the committee killed the bill.

Now, Monsanto is buying Montana’s preeminent private wheat seed company to access valuable genetics and expand control over what is sold, sown, and swallowed.

Kristina Hubbard is a Montana-based consultant for the national Farmer to Farmer Campaign on Genetic Engineering.

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