Heads up! The $66 billion Bayer-Monsanto merger just got a major green light – but farmers are terrified

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Monsanto cites the projected population of 10 billion by 2050 as the driving force behind their merger with Bayer, claiming the merger will allow for greater investment opportunities.


A blockbuster deal between Bayer and Monsanto appears to be moving ahead.

On Monday, the US Department of Justice approved the German pharmaceutical and chemical group’s bid to buy the US seed giant for more than $60 billion, The Wall Street Journal reported. Bayer agreed to sell off additional assets to alleviate anti-trust concerns.

The two companies first announced the potential deal in September 2016, saying the move would boost agriculture research and innovation.

“By the time 2050 rolls around, the world will have 10 billion people, and the demand for food will double,” Robb Fraley, Monsanto’s chief technology officer, told Business Insider last year. “The whole point here is that the business combination between Monsanto and Bayer will allow the companies to invest in and create more innovation, and it’s going to take a huge amount of innovation in order to double the world’s food supply.”

Farmers aren’t so sure.

“From my perspective, they’re saying the exact opposite of what most people in the industry actually believe,” Clay Govier, a farmer in central Nebraska, told Business Insider in January 2017. Govier is the fifth generation to work on his family farm of 3,000 acres, which primarily grows corn and soybeans. The farm has used Monsanto products for at least 12 years, and Govier’s family expects seed and chemical prices to increase due to the merger.

That could put many small family farms in tough positions.

“I just sat down to chat with my banker the other day, and fortunately we’re in a position that I don’t think we’re going to have to have a hard conversation when it comes to loans for next year,” Govier said. “But he said there are a lot of guys out there that are going to have a really hard conversation.”

Consolidation on the rise

According to the US Department of Agriculture, farm production in the US has consistently shifted away from smaller farms, to larger ones. Whereas just 15% of all cropland was held by farms with at least 2,000 acres in 1987, that percentage had jumped to 36% by 2012.


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Farmers are worried an increase in the cost of materials will further increase the consolidation of farmland by larger farms.


h/t TheMadQuixotician


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