As the buzz surrounding consolidation in the ag industry continues, farmer and farm-group reactions continue to pour in after Bayer and Monsanto announced their agreement to merge.
“A major concern is that we’ll have to start paying what they want us to pay,” Nebraska farmer Dave Warner told Farm Journal Media at Husker Harvest Days, reacting to the Bayer/Monsanto announcement. “On the backside, innovation will probably be better and we’ll get stuff to the industry faster.”
Meantime, the American Farm Bureau Federation’s (AFBF) chief economist, Bob Young, isn’t surprised consolidation continues to make industry headlines.
“It’s perfectly understandable the inputs sector for agriculture is going through this kind of consolidation,” he says. “Think about how long it takes [agribusinesses] to bring a new product to market. They have a tremendous regulatory fight, and even once it’s approved, you’ve still got to fight litigation. So you’ve got to have deep pockets.”
“It makes sense for chemical side of the house to hook up with the genetics side of the house,” Young says. “That’s certainly what happened and the Dow/DuPont side and what happened on the Bayer/Monsanto side.”
Dow and DuPont are also proposing a merger, as are ChemChina and Syngenta and John Deere and Precision Planting.
Despite Bayer and Monsanto’s statements about potential benefits, many farmers aren’t so sure.
“I think [farmers] are justified in some of their concern,” Young says. “[Even so], if we can get innovation at that scale with those kinds of resources behind them, I think they’ll fight tooth and nail for every bit of market share they can get.”