Feds probing seed industry
Hixon went on to state that company insiders revealed celebrations occurred during a Christmas party last year. "Mostly this was due to their ability to monopolize universities pertinent to their agenda. By donating a million bucks to each school, Monsanto can expect taxpayers to pick up the remaining tab on what would have cost them a billion on their own. This doesn't include their added funding from the USDA and farmers' check-off dollars," he continued, adding that the company can then use the money it saved to buy more seed companies.
Study of seed issue draws plenty of interest
Olney Daily Mail, September 30 2009
Olney, Ill. - Due to concerns regarding rising seed prices and industry concentration, the Department of Justice and the U.S. Department of Agriculture announced recently they will examine competition and antitrust concerns in the seed industry.
According to information from the Department of Justice, the two agencies will hold public workshops to explore competition issues in the agriculture industry. The first such event will be held in early 2010. While some of the workshops might be held in Washington, D.C., others will be held regionally. The agencies are soliciting public comments from lawyers, economists, agribusinesses, consumer groups, academics, agricultural producers, ag cooperatives and other interested parties.
Steve Hixon, of Steve's Seed Conditioning in Claremont, has long been frustrated by what he calls "anti-competitive" behavior in the seed industry, but sees this as a positive step.
"I have expectations that the Justice Dept. will finally enforce accountability," Hixon said in written comments.
One company in particular, Monsanto, has drawn the ire of Hixon and others for what they see as monopolistic behavior.
He stated that Monsanto's exclusionary behavior "could only be accomplished using their various forms of influence like a well-oiled machine."
He continued by stating that these forms include large financial contributions to elected officials, consuming state and federal bureaucracies, and "covertly pointing" former employees into judicial positions, interfering with policy in organizations and associations "that claim to represent us." He stated that their products' genetic modifications contain an adventitious presence, and noted its ability to contaminate the ecosystem is referred to as a "natural order."
Hixon went on to state that company insiders revealed celebrations occurred during a Christmas party last year.
"Mostly this was due to their ability to monopolize universities pertinent to their agenda," he stated.
"By donating a million bucks to each school, Monsanto can expect taxpayers to pick up the remaining tab on what would have cost them a billion on their own. This doesn't include their added funding from the USDA and farmers' check-off dollars," he continued, adding that the company can then use the money it saved to buy more seed companies.
Monsanto spokesperson Andrew Burchett said that, regarding the workshops, Monsanto is comfortable talking about its business and it thinks the workshops will provide objective discussion.
"It's definitely a competitive industry and we compete vigorously," he said when asked about concerns that the company is a monopoly, also noting, however, that there are choices for farmers.
Burchett stated that Monsanto licenses its developed traits to competing companies. Burchett said there are alternatives to buying Monsanto seed, though Monsanto does get paid when seed carrying its traits is purchased because those traits are its intellectual property.
In an e-mailed statement, Burchett said, "Monsanto licenses its traits to competitors so farmers can buy Monsanto traits through the seed companies of their choice. The result has been wide-spread adoption by farmers and the ability of small seed companies to compete against large companies by offering advanced biotech seed."
"Farmers have a lot of different choices," he said.
Burchett stated that market data from last season show 212 corn-seed companies sold 4,692 seed products and 185 soybean companies sold 2,138 seed products. The range in prices farmers reported paying from corn seed was more than $200 (under $50 to over $300).
"With so many choices, farmers will buy the seed that works best for them," he continued in his written statement. "We earn their business when our seed makes them more profitable than the competitors'."
Burchett said the company is now in a leadership position because it invested billions in technology where other companies invested millions.
He said the company sees that farmers continue to choose the latest premium products. He also said there is still conventional seed at many different prices.
Burchett said the traits Monsanto patents are from private research, although it is interested in licensing technology developed by other companies and universities and it supports ag programs.
Illinois Farm Bureau President Philip Nelson, who was in Olney recently to talk about the cap-and-trade issue with area Farm Bureau members, said the organization has not specifically spoken out on the USDA and Department of Justice examination of the seed issue.
Nelson said one has to be careful any time there is an ongoing investigation. He said, however, that the Farm Bureau has weighed in on a number of mergers in the last six years in the seed and packing industry since he has been president.
Without addressing Monsanto specifically, Nelson said the Farm Bureau shares concerns about concentration in the industry as a whole. He said there are four seed companies that control 75 percent of the marketplace and four packers on the livestock side of things. He said there are concerns about competition, noting both buying and selling, any time there are so few players.
"I echo the same concern on both sides of the aisle," he said.
Fred Stokes, Executive Director of the Organization for Competitive Markets, said the group applauds the investigation of the issue, specifically singling out the workshops, which he feels are "the real McCoy."
"I think this is a genuine effort to get answers," Stokes said.
He said he does not think there is much of a prospect for legislation to address their concerns because the new chairwoman of the senate agriculture committee, Arkansas Sen. Blanche Lincoln, has not typically sided with them.
He said there is some evidence that the Department of Justice is collecting information to prepare for enforcement action in the transgenic seed business.