It’s not surprising Bayer and Monsanto leaders on Wednesday claimed farmers are happy about a possible merger of the two companies. But when Monsanto Chief Technology Officer Robb Fraley was challenged on that question, he explained why.
Fraley was asked by this journalist to “put himself in the place of American farmers who hear of large ag mergers every day, and are skeptical that these deals won’t hurt competition and raise their prices.”
Fraley cited his childhood growing up on a northern Illinois farm, recalling his father spending “hours” on input decisions.
“There’s a subset of farmers who don’t like any change at all,” and they feel having more, smaller companies means more competition for their business.
“Increasingly, I’ve talked to a lot of growers who recognize that in reality, farmers are really better served by companies who have more capabilities, more of an R&D engine who can generate more products and more innovation,” he says. “As we have the opportunity to have dialog with grower groups, you see the shift that growers realize it’s going to take more R&D" for them to maintain profitability and feed the world.
A combined Bayer/Monsanto entity would spend about $3 billion annually on R&D, about twice what Monsanto invests today, Fraley says.
“I will plan to spend a lot of my time over the next several months having those conversations with farmers,” he says. “The industry is clearly changing as a combination of the incredible tools that are coming into ag … it’s important for growers and companies to be in a position to take full advantage of that," he said.
"The way we can be successful in the new company is if we develop products farmers want. That’s the opportunity. The real winner in this deal is farmers around the world.”