Scrutiny of agri-chemical mergers underway at EU level

Concerns about increased costs to farmers that may arise from the reduction in competition arising from the ongoing mergers on the agri-chemical sector will be taken into account.

This is according to MEP Mairead McGuinness, who said she has received assurances from the Competition Commissioner Margrethe Vestager on the matter.

Speaking in Strasbourg, McGuiness said there is a real risk that three major developments in the sector, involving Chemchina’s proposed acquisition of Syngenta, ongoing negotiations between Monsanto and Bayer and the proposed merger of Dow and DuPont could lead to increased costs to farmers.

She also said that the potential mergers could reduce the choice available to farmers in terms of seeds and crop protection products.

“These are major corporations with a great deal of market power.

Where you have six individual companies reduced down to three companies by way of merger, the fear is that it will lead to disproportionate power in the marketplace.

“We have to ask the question who’s interest is served by these mergers of major companies into mega corporations,” she said.

McGuiness added that Commissioner Vestager confirmed that the Commission will carefully investigate these three proposed mergers.

While Bayer’s acquisition of Monsanto had not yet been formally notified to the Commission an in-depth investigation of the Dow and DuPont transaction was underway and a preliminary investigation of the Chemchina acquisition of Syngenta.

Commissioner Vestager told McGuiness that the concerns raised regarding the potential effects of the transactions on prices and on consumer choice will be duly taken into account in the investigations.

The Commissioner said the issue of competition in the food supply chain is being taken very seriously and is being addressed in the specialised Food Task Force to analyse the functioning of the European food supply chain.