The U.S. Justice Department has approved the $142-billion merger of Dow and DuPont, creating the nation’s largest agriculture biotechnology seed firm.
Nebraska Farmers Union President John Hansen says it’s another example of big ag getting even bigger.
“We have fewer choices to buy from and the marketplace becomes more tightly managed and controlled and that results in higher prices that farmers pay because they have the economic muscle to be able to do that,” Hansen says. “It’s disappointing.”
Hansen says large companies always claim merging will mean increased efficiency and better delivery of products, but he says any gains in the Dow-DuPont pairing would be offset by “marketplace manipulation.”
“They use their marketplace control to be able to exacerbate higher rates of return and make more money and they stick that money in their pocket,” Hansen says. “The consumers, or in this case, the buyers, never see any of the benefit from operating efficiency.”
Other looming mergers in the industry include: Bayer buying Monsanto, ChemChina buying Syngenta and the merger of fertilizer companies Potash and Agrium.
Without the Justice Department bringing tougher antitrust enforcement over mega mergers, Hansen says farmers will have to turn elsewhere.
“Congress has the ultimate authority to be able to set law and set direction to have the benefits of our free enterprise system,” Hansen says. “We’re also talking to members of Congress saying, ‘How bad does it have to get before you guys step up and intervene and start providing some badly-needed oversight and direction?'”
While the Justice Department approved the Dow-DuPont merger to move forward, it’s also requiring the sale of multiple crop protection product lines and two petrochemical lines before finalizing the merger.
By Jerry Oster, WNAX, Yankton