A Global Food System in Disarray

The negative effects of such mergers can be felt on a much finer scale too, with merger-favorability being relatively dismal among producers themselves. With regard to Bayer’s plans to acquire Monsanto, a 2016 survey found that 67 percent of farmers felt the move was negative, with only 10 percent indicating it was positive. With regard to ChemChina’s plans to acquire Syngenta, a 2016 survey found that more than 80 percent of farmers had a negative or very negative opinion of the merger. Such opinions suggest that the vast majority of farmers have had a negative experience of increasing corporate consolidation and corporate power, despite the pro-farmer narrative put forth by such corporations themselves.10

From the “Big Six” to the “Big Four”

The trend toward concentration of power among agricultural, pharmaceutical, and chemical firms has been longstanding. During the 1990s there were numerous mergers between such firms that aimed to take advantage of potential synergies and secure even greater corporate profit and strength. But since the mergers took place within the globalized market where most agricultural, pharmaceutical, and chemical markets exist across different countries, these expected synergies were ultimately not realized.

Instead the result was the spinoff of numerous agricultural divisions: Monsanto, for example, merged with Pharmacia and Upjohn before a new Monsanto division—now focusing on agriculture—separated to form an altogether different entity. Syngenta began with the merger between the agribusiness divisions of Novartis and Zeneca. However, AstraZeneca, which focuses on pharmaceuticals, remains a separate company. Bayer acquired the agribusiness operations of Aventis, yet Sonofi-Aventis remained a financially distinct pharmaceutical company.

By the 2000s, six companies that focused on agricultural, pharmaceutical, and chemical products held control over a majority of the global proprietary (i.e. brand-name) seed and agrochemical market: BASF (the German chemical company and the largest producer in the world with subsidiaries and joint ventures in more than 80 countries), Bayer, Dow Agrosciences, DuPont, Monsanto, and Syngenta.

Together, these corporations from the US, Germany, and Switzerland constitute what many have called the “Big Six.” They have been called this because they have had a dangerous chokehold on the global agricultural market, with effectively unrivaled national and international political influence. For example, in 2013, these six companies accounted for almost $23 billion in sales of seeds and biotech traits and $38.5 billion in sales of agrochemicals, for a total of $61.5 billion per annum, ultimately maintaining control of 63 percent of the commercial seed market and 75 percent of the agrochemical market.11

These corporations were also called the “Big Six” because of their overwhelming influence with regard to the global agricultural research agenda. For example, in 2013, these companies collectively spent $4.7 billion annually for research on seeds and pesticides—75 percent of all such private sector research.12

With these and other mergers, however, the “Big Six” in the agricultural seed, chemical, and traits area are rapidly becoming the “Big Four”: BASF, Bayer-Monsanto, Dow-DuPont, and ChemChina-Syngenta. A number of other mergers in recent years—most involving these corporations—have also characterized this trend in consolidation. As of April 2017, Sinochem and ChemChina were in merger talks to create the world’s largest industrial chemicals firm. In October 2017, BASF announced that it is acquiring a large portfolio of seeds and herbicides from Bayer for $7 billion, making BASF a major player in the seed market. At the same time as its merger with Dow, DuPont agreed to sell its crop protection portfolio to FMC, while in turn acquiring FMC Health and Nutrition; and in September 2017, the Canadian companies Agrium and PotashCorp announced they are merging to create the largest fertilizer company in the world.

Yet the massive mergers of Monsanto and Bayer (the first and third largest biotechnology and seed firms in the world, respectively), the merger of Dow and DuPont (the fourth and fifth largest biotechnology and seed firms in the world, respectively), and the merger of ChemChina and Syngenta (China’s largest chemical company and the world’s largest crop chemical producer) dominate the scene.