Consolidation of global agribusiness goes on

Bayer + Monsanto

German chemical concern Bayer confirms plans of acquiring Monsanto, the largest producer of genetically modified seeds. The companies signed a corresponding agreement on September 14, 2016. The amount of all-cash purchases rose up to $66 billion (from $62 billion in May 2016 [1]). As the result, Bayer will become a global agri-leader (more than 25% of the market share of seeds and pesticides).

Experts and market participants express their concern about this and similar mega-deals that are planned and conducted at the agro-market (ChemChina and Syngenta, Dow and DuPont, Potash Corp. and Agrium), as they take control of the global agri-market and jeopardize the food security of the world.

According to ETC Group, before the merger “the great six” – Bayer, Monsanto, DuPont, Dow, Basf and Syngenta controlled 75% of the world agricultural market and 63% of the world commercial seed market, total annual sales are> $65 billion. The number of players is reduced to 4 now, and the total market share will increase even more. It ultimately will lead to reduced competition and higher prices.

Source: BBC [2], E Vesti [1], Bayer [3], Agrium + Potash Corp. [4], ETC Group [5], ETC Group [6], ETC Group [7], ChemChina + Syngenta [8], Dow + DuPont [9]