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A DuPont Pioneer sign is seen outside the companies' headquarters in Johnston, Iowa.(Photo: Charlie Neibergall/AP file photo) First Monsanto tried to buy Syngenta, only to be turned down.Then news circulated that the agricultural pesticide and seed divisions of Dow and DuPont were either for sale or in search of a new partner. The other two big seed-biotech-pesticide industry players — BASF and Bayer — also were actively exploring merger and/or acquisition opportunities. The ag-business news reported frequently that “everybody is talking to everybody” in search of strong new partners, once the music stops. Seasoned observers predicted that once one deal within the seed-pesticide industry happened, a series would follow in short order, and that sooner rather than later, there would be three or four global companies controlling most of the worldwide seed and pesticide industry. And now it has begun. The just-announced “merger of equals” between Dow and DuPont is stunning news on many levels, but one should be of special interest to Iowa farmers and citizens. While details are vague, the merged company will be broken into three parts: chemicals, agriculture (seeds and pesticides), and everything else (plastics, fabrics, polymers, etc). The agricultural company that emerges will include the Dow AgroSciences pesticide product line (mostly herbicides and insecticides,) and their seed and biotech assets. DuPont’s contribution will include the Iowa-bred and based seed company Pioneer, as well as DuPont’s portfolio of pesticides (important fungicides, several herbicides, and a handful of insecticides). If this deal unfolds as planned, Iowa farmers can look forward to even less choice when it comes time to order corn and soybean seed, higher seed prices, and a doubling-down on GMO technology that is working less and less well. The near-term financial performance of the new company will be determined by how fast the next generation of corn and soybean seeds can be brought to market, seeds that are genetically engineered to resist multiple herbicides. The farm-sector financial squeeze will tighten, as another chunk of net farm income is passed on to the technology developers and input suppliers. There will be, after all, new profit targets and lots of new debt that needs servicing. For Iowa’s environment and citizens, the decade long, steady increases will continue in the number and volume of chemicals and insect toxins needed to bring a crop to harvest. Ongoing public and private efforts to lighten row-crop agriculture’s environmental and public health footprint will struggle to slow the inevitable decline in biodiversity, and the health of Iowa’s soils and water resources will face new risks. Imagine instead another scenario that could emerge as a way to resolve anti-trust concerns. Suppose some insightful and cagey investors (e.g. Warren and Howard Buffet), step forward and make a play to extract Pioneer from this merger, and restore it as a free-standing company. Twenty years ago, the Pioneer seed company was the most respected major agribusiness company in America. Their commitment to farmers was rock solid, and included a pledge to assure farmers captured $3.00 in value, through higher yields, for every extra dollar spent on their corn hybrids. This was a corporate farmer-sustainability pledge that meant something, and which the company took pride in delivering on, year in and year out. Pioneer was a welcomed and respected voice in the halls of Congress and at the state level when critical agricultural policy issues were in play. They believed in and supported agricultural research and education, with an emphasis on the needs of farmers and the public good. There is a hunger across farm country for new hope, and help in dealing with a long list of problems and challenges. Not the government, the universities, nor the private sector are pursuing meaningful solutions. Maybe its time for a free-Pioneer movement, in the hope that an independent Pioneer can again demonstrate that serving the needs of farmers, and society as a whole, is good for business, for Iowa’s farmers, and maybe even the planet. CHUCK BENBROOK is an agricultural consultant and former research professor at Washington State University. Contact: charlesbenbrook@gmail.com
