Seed wars and monopolization: the case of Monsanto

By Srishti Malhotra

Edited by Namrata Caleb, Senior Editor, The Indian Economist

The Genetically Modified (GM) seeds world has been facing a serious threat: that of monopolization, resulting in “seed wars” across the world. In 2013, Philip Howard, a researcher at Michigan State University and creator of the popular Who owns Organics info-graphic showed that Monsanto, DuPont and Syngenta controlled over half of the global seeds production, a sharp rise since 1996 when the top three corporations in the global seed industry controlled 22% of the industry. GM crop cultivation is predominantly limited to a few countries: 90% of GM crops are grown in the US, Brazil, Argentina, India and Canada.

The “big four” biotech seed companies—Monsanto, DuPont/Pioneer Hi-Bred, Syngenta, and Dow AgroSciences—own 80% of the US corn market and 70% of the soybean business. This movement away from a competitive market to one that is an oligopoly or even worse, a monopoly is evident from the fact that the largest and the best known company of these, Monsanto, licenses its genetically modified traits to other seed companies and as a result, more than 80% of US corn and more than 90% of soybeans planted each year are attributable to Monsanto. The Department of Justice in the US investigated Monsanto’s dominance of the seed market in 2010 but failed to take any action.

Monsanto’s legacy includes the production of herbicides RoundUp and Agent Orange (used during the Vietnam War and later proved to be a carcinogenic), banned substance DDT, and saccharine (artificial sweetener). In mid-90s it started producing GM crops such as soybeans, alfalfa, sugar beets, and wheat. These crops were immune to its leading weed killer, Roundup. That meant that farmers no longer had to till the land to kill weeds, as they had been doing for hundreds of years. They could simply blast their entire fields with chemicals, leaving GM crops the only thing standing. Monsanto then patented the seeds. Since 1980s, Monsanto has won 674 biotechnology patents according to US Department of Agriculture data, much more than any other company has.

However, the usage of GM seeds imposes additional indirect costs on the farmers. Traditionally farmers were able to save money every year by replanting seeds produced in the previous year’s planting. Monsanto’s contracts prohibited them from using these, implying that the farmers had to purchase new seeds every year from Monsanto or face penalties worth millions of dollars. Monsanto engaged in spying and intimidating farmers to prevent them from replanting seeds. Traditional seed varieties were pushed out of the market making it impossible for farmers to cultivate non-GM seed varieties, since Monsanto bought two major traditional seeds companies in 2005. Since 1996 Monsanto has launched thousands of investigations and filed hundreds of lawsuits against farmers alleging violation of its patent rights. Most farmers settle and pay an amount in damages as they don’t have the time or the money to pursue the case.

According to the US Department of Agriculture’s Economic Research Service, the average per-acre cost of soybean and corn seed in the country increased 325% and 259%, respectively, between 1995 and 2011. This corresponds to the time period when acreage of GM corn and soy grew from less than 20% to more than 80-90%. Moreover, the crops do not command a higher price once they are grown and continuously increasing pesticide usage adds to costs for farmers. A US Department of Agriculture Report and a 2009 study by Doug Gurian-Sherman, a senior scientist with the Union of Concerned Scientists, confirmed that commercial GM crops do not increase the intrinsic or potential yield of any crop. Instead, pests become increasingly resistant to them. Since GM crops were introduced in 1996, pesticide usage has increased by 404 million pounds. Sales of a corn-soil insecticide produced by Syngenta, one of the world’s largest pesticide makers, more than doubled in 2012, due to the increased resistance to Monsanto’s pesticide.

The effects have not been limited to the US alone. According to Consumers International, around 270,000 small-holding farmers were forced to grow GM corn in the Philippines and ended up in debt as the cost of corn seeds rose 282% from its introductory price. In India, farmer suicides by farmers cultivating Bt Brinjal were attributed to the increasing cost of seeds and pesticide use. In 2011, 90% of total area of cotton production was under Bt cotton, an insect-resistant variety. However, the bollworm pest which plagued cotton and initiated farmers to shift to Bt cotton eventually became resistant to Bt cotton. However, a greater threat faces our food supply system. In 2012, Christian Krupke, a professor of entomology at Purdue University, showed that neo-nics which had been used to treat Monsanto’s GM corn, led to the collapse of bee colonies which threatens the entire food system since one-quarter of the human diet is pollinated by bees.

GM crops have faced greater resistance across the world than in the US. Mass mobilizations in Haiti restricted Monsanto’s donation of GM seeds after the Haitian earthquake to protect their small farmers and the food sovereignty in the country. The European Union imports 30 million tons of GM crops annually for livestock feed, but it has approved only two GM crops for human consumption- Monsanto’s MON810 maize and BASF’s Amflora potatoes. Several countries in Europe now have national bans on these two despite the European Commission’s opposition to these bans. Between 2008 and 2010, the total area of agricultural land under GM crops in the EU declined by 23%. In 2010, a moratorium was imposed on Bt Brinjal in India, restricting Monsanto from commercializing an Indian staple food. In 2011, the Indian government’s National Biodiversity Authority took legal action against Mahyco Monsanto for biopiracy alleging that the company had used six local varieties of brinjal for the development of Bt Brinjal without essential approvals. In Latin America and the Caribbean countries like Haiti, Brazil, Argentina and Peru, movements and local communities are fighting for bans on GM seeds and pesticides, and for food sovereignty and independent local control of seeds and agriculture. The Food and Drug Administration (FDA) of the US does not require genetically modified foods to carry a label, but organic food companies and some consumer groups have intensified their push for labels arguing that they have a right to know what their food is made up of, and this has been supported by consumers who are averse to processed and modified foods.

The problem of seed and food monopoly does not have easy answers. Whoever controls the seed supply of the world ends up controlling the food supply of the world. Independent and uninfluenced research will go a long way in paving the way for future developments and from preventing the monopolization of agriculture by unscrupulous companies as has happened in the case of the US. The fact that developing countries depend much more on agriculture than the developed countries makes this issue one of equitable distribution of income and resources for them and therefore, agriculture in these countries cannot be ruled by the profit making motives of global organizations. A much more careful analysis is needed of the impact of this ‘industrialized’ agriculture on the smallest of farmers.

Srishti Malhotra is pursuing M.A. Economics at Centre for Economic Studies and Planning, JNU. She graduated in economics from University of Delhi. Subjects that interest her the most are macroeconomics, international economics and finance. Dance is the passion of her life and she is a trained dancer in western styles .Her future plans include travelling the world and learning to play the drums.