The five company executives were literally elbow to elbow, but they all fit at the narrow table where they sat facing a stern semi-circle of U.S. senators.
They were in D.C. representing five of the "Big Six" agricultural companies and testifying in front of the Senate Judiciary Committee in defense of the two massive mergers and a key corporate purchase underway. Squeezed in next to them were four other representatives from the American Antitrust Institute, the American Farm Bureau, the National Corn Growers Association and the National Farmers Union.
A number of senators remarked on how tightly the Monsanto, Bayer, Syngenta, DuPont and Dow AgroSciences executives were squeezed in. "I don't think I've been at a hearing of the Judiciary committee where there have been this many witnesses at one table," marveled Senator Richard Blumenthal, D-Connecticut, at one point.
From my perch at the press table, he was incredulous about the wrong thing.
Together, those five men in one room represented the majority of the global seed and agro-chemical industry. If BASF (who, from the outside, must look like the only girl at the dance without a date these days) had been there, the picture would be pretty much complete. Soon -- if the Department of Justice gives Dow and DuPont the go-ahead to merge and approves Bayer's purchase of Monsanto -- just four executives (and their stockholders) will have great control of that industry.
That point wasn't lost on Senator Chuck Grassley, R-Iowa, who organized and oversaw the hearing that brought these executives to Washington.
"When does the size of companies and concentration in the market reach the tipping point, so much that a market becomes anti-competitive?" he asked them. He called attention to consolidation underway in other industries, as well, namely the proposal to merge Potash Corporation and Agrium into the largest fertilizer company in the world.
"I'm afraid that this consolidation wave may have become a tsunami," he said.
In fewer than four decades, more than 30 individual agricultural firms have merged, married and bought their way down to six behemoths (Monsanto, Bayer, BASF, Syngenta, Dow and DuPont). According to estimates from a 2015 Michigan State University study, those six represent 60% of the global seed market and 76% of the global agro-chemical market.
Just the top three -- Monsanto, DuPont and Syngenta -- account for more than half of the global seed available, as well as 85% of GMO corn patents and 70% of the patents on all other GMO crops (mostly cotton, soybeans and canola), according to another study from Penn State.
"Institutional economists suggest that when four firms control 40% to 50% of the market, it is no longer competitive," National Farmers Union president Roger Johnson said during his testimony in front of the committee.
In light of the big mergers underway, 40% to 50% sounds positively quaint.
According to the most recent industry analyses, Dow-DuPont, Bayer-Monsanto, and ChemChina-Syngenta would control 80% of U.S. corn seed sales and 70% of the global pesticide market, Johnson told the senators.
The company executives talked about the difficulty of getting products to market in a complex regulatory system, a waning ability to pour resources into research and development and the efficiencies and innovation that could come from easing their financial burden by teaming up with former rivals.
On the other (very small side) of the table, two lone voices rose up against this interpretation -- Roger Johnson of the NFU and Diana Moss of the American Antitrust Institute. They spoke of farmers trapped into single chemical and seed crop production systems as innovation stagnated without robust market competition.
Because senators had only a few minutes to ask questions and receive answers in the 2.5-hour hearing, it was very hard for the witnesses to delve deep into their claims and combat the other sides' message. That made it even harder for a journalist to weigh the value of each side, as well.
What did seem clear, however, was the closing of the ranks within commercial agriculture in favor of further consolidation. Out of the nine witnesses present, the only firmly stated concerns about what these mergers could mean for individual farmers came from Moss and Johnson -- neither of whom would be considered mainstream voices or forces in the current agricultural industry.
Some of the senators seemed to sense this unevenness, but many lacked the agricultural knowledge to adequately question and critique some of the claims put forth by the witnesses. At least one senator expressed frustration with the imbalance in front of him.
The American Farm Bureau, the country's largest farmer-led organization, sent their Chief Economist Bob Young to the hearing. During his answer to a question about whether Farm Bureau members had fears about the merger, Young launched into a defense of the companies' merger-driven mindset and had to be reminded that he was not there to testify on their behalf.
"I think we can understand the rationale of why companies want to merge -- it's more profitable," Senator Dick Durbin, D-Illinois, interrupted impatiently. "But we have to look at it from a consumer's point of view -- as to whether or not this is good policy. That's why the government is stepping in, as it should, for antitrust consequences."
From my corner of that crowded room, that perspective was never truly explored. Moss and Johnson's concerns lay out in the open, mostly unanswered by the company and commodity groups in the room. Both sides of the argument were voiced, yes, but only one side holds the power, the numbers and the political influence to make theirs stick.
At the end of the hearing, the five company executives filed out of the room, one at a time. I found myself wondering how many will be here when I come to another such hearing 10 years from now -- and how will farmers have fared in the aftermath?
You can watch the full proceedings of the Senate Judiciary hearing on ag consolidation here, as well as read the written statements of each witness: http://bit.ly/….
Emily Unglesbee can be reached at Emily.email@example.com.
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