Consolidation Nation: 25 Years of Mega Mergers in Crop Protection and Seeds
Editor’s Note: As we mark the first 25 years of the 21st century, CropLife reflects on the innovations, challenges, and transformations that have shaped ag retail — honoring our past while looking ahead to agriculture’s promising future. In this article, we explore how industry consolidation, market pressures, and legal battles have reshaped the crop protection and seed sectors — and what it means for the road ahead.
On the corporate side of the crop protection/seed businesses, the first 25 years of the 21st century seen a continually wave of mergers, consolidations, and acquisitions take place. And a few of these were huge.
This trend started almost immediately after the turn of the century. In early 2001, Dow AgroSciences announced it had acquired the crop protection business of Rohm & Haas. This was followed by other such deals – Bayer buying Gustafson Seeds in 2004, Syngenta purchasing Garst Seeds in 2004, Monsanto acquiring Delta Pine in 2006, and BASF buying Becker Underwood in 2012.
With these smaller deals complete, the stage was now set for some major mergers by the mid-2010s. According to market viewers, this was motivated in part by commodity prices at the time.
“There’s no question about it — the price of corn in the U.S. led to this,” said Alex Polinsky, Owner of Polinsky Chemical, speaking at the 2018 AgriBusiness GlobalSM Trade Summit. “Corn prices in 2008 were at $8 per bushel or more. Today this has fallen to around $3 per bushel. The overall loss in value for the entire agricultural industry from this amounts to more than $15 billion. These losses have impacted all the suppliers in this market, including but not limited to equipment, chemicals, seeds, and fertilizer.”
With crop protection/seed suppliers receiving less money from growers for their products, added Polinsky, these companies have seen their costs to bring new products to the market steadily rise. On average, he said, it costs between $300 million and $500 million to develop a new active ingredient today — more than double what it had cost at the start of the 21st century.
“Given these facts, only the largest agrochemical companies have the adequate resources to spend money on research and development to try to stay ahead of the weeds and bugs that farmers need to control,” said Polinsky. “You have to have a lot of dollars on hand. And for many companies, merging was the only thing they could do to make their bottom lines look better and survive.”
The first major crop protection/seed company to jump onto this Syngenta Crop Protection. In 2016, the company announced it was being acquired by ChemChina. According to Alexandra Brand, then Chief Sustainability Officer, bringing together the resources and personnel of Syngenta and ChemChina represented a big plus for both companies, ranking it in second place among crop protection/seed suppliers with annual sales in the $16 billion range. “When we were just Syngenta, we felt that our company needed better seed varieties and new innovations to grow,” Brand told CropLife in a 2019 interview. “Now, with ChemChina behind us, we can develop this level of innovation as a company with a more developed long-term focus than ever before.”
Not long after, another major merger took place. Throughout late 2017, Dow and DuPont were in merger discussions. DowDuPont was formally formed in March 2018. Slightly more than one year later, in June 2019, Corteva Agriscience was spun off into its own publicly traded company devoted to agriculture.
“The Dow and DuPont teams have made incredible progress in six short months, and today’s announcement is another demonstration of the unprecedented value creation potential of this historic merge and spin transaction,” said Andrew Liveris, then Executive Chairman of DowDuPont in an interview with CropLife® Magazine in 2019. “We are squarely focused on unlocking enhanced cost and growth synergies, delivering on our growth investments and innovation pipeline, and separating into three industry-leading companies on the accelerated timelines we recently announced.”
Of course, the largest crop protection/seed merger was also taking place at the same time as Dow/DuPont. In mid-2016, Bayer announced plans to acquire Monsanto. The deal was finalized during the last half of 2018. Combined, the company had annual sales in the $22 billion range, easily ranking it as the No. 1 crop protection/seed supplier in the world.
According to Liam Condon, then President of the company’s Crop Science Division, the Monsanto acquisition gave Bayer a “strong starting position” within the agricultural marketplace. “But that’s not the reason we brought these two established companies together,” said Condon in a 2019 interview with CropLife. “We want to be able to set new standards in the market and be able to develop and bring new innovations to growers faster than anyone else can.”
Lawfare in Earnest
Of course, one of the unwanted side effects of all these mergers included not only physical assets but legal obligations as well. In particular, numerous lawsuits filed against glyphosate/Roundup/Monsanto over the years were now the problem of new owner Bayer.
If there’s a poster child for legal wranglings since the 2000s began, it’s glyphosate. For decades now, special interest groups and anti-biotech proponents have repeatedly questioned the popular herbicide and its use within the agricultural marketplace. In fact, in December 2023, the Center for Food Safety, Beyond Pesticides, and several farmworker advocacy groups petitioned the courts to cancel EPA’s glyphosate registration based upon a federal court’s decision that found fault with the agency’s human health assessment.
This was all made worse since the International Agency for Research on Cancer found that the herbicide is a “probable carcinogen” based upon its own data. Because of this finding, numerous individuals has successfully sued Bayer/glyphosate for health issues caused by using the product. According to most sources, judgements against Bayer have totaled in the multiple billion-dollar range.
Naturally, Bayer has fought back against these legal challenges. In 2020, the company agreed to pay between $10.1 billion and $10.9 billion to settle thousands of glyphosate lawsuits. Furthermore, the company is fighting to maintain glyphosate’s registration, with the support of industry trade groups, filing petitions for a review of some of the cases by the U.S. Supreme Court and lobbying states to pass legislation protecting glyphosate by recognizing federal warning labels superseding those that might have been mandated at the local level.
In addition, newer crop protection/seed systems have also come under legal scrutiny. For example, dicamba, which was part of a new cropping system launched in 2016. These new crops, resistant to dicamba, spent a few years being used in the agricultural market.
However, in mid-2020, EPA original authorization for the herbicide was vacated by the U.S. Court of Appeals for the Ninth Circuit. By the end of October 2020, the EPA was successful in re-authorizing dicamba for use. Still, this decision did lead to one manufacturer, Corteva, discontinuing the production of its dicamba brand, FeXapan.
But in February 2023, dicamba once again found itself on the wrong side of the law. A federal court in Arizona vacated EPA’s 2020 registrations for dicamba products to be used in over-the-top applications. This effectively meant that the agricultural community would be unable to apply XtendiMax (Bayer), Enginia (BASF), and Tavium (Syngenta) for the 2024 growing season.
In reviewing the case, the court found that EPA to be in violation of the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) when it re-authorized dicamba back in 2020. “Being aware of the practical effects’ of vacatur and difficulties these growers may have in finding effective and legal herbicides to protect dicamba-tolerant crops due to vacatur, the court nevertheless found the seriousness of the agency error, including in part its failure to assess risks and costs for non-users of over-the-top dicamba compelled vacatur,” said the court in its ruling.