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Ag News

Ag Chem mergers drive up prices

  • By: Farm Tender "Prime"
  • Jul 11, 2017

There seems to be an ongoing appetite for consolidation amongst World Ag Chemical companies as low commodity prices stem growth. Becuase of tighter margins these companies cannot grow as quickly as they like so they acquire or merge so they can show growth to there shareholders.

Who loses out when the big get bigger, through acquisitions or mergers?

You guessed it, the Farmer....

Farmer Business Network (FBN), the US independent Ag data company, has proven over a period that the consolidation from many, to a few companies, hurts competition, which then drives input prices up. Think the Woolworths/Coles scenario in food here.

The Bayer Monsanto deal expected to take place in mid-2018 will see these guy become bigger that Syngenta, which is already the worlds biggest crop protection company. But ChemChina has just inked a deal to take over Syngenta for $56 billion.

Dow Chemical and DuPont will finalise their merger in August

These created monopolies are becoming more powerful and competition is reduced. Not good for Farmers