March 31, 1998

Monsanto Takes Terminator

Its Now or Never for Agricultural Biodiversity in Bratislava

After a week of silence on the subject, the USA (a country that is not a Party to the UN Convention on Biological Diversity) is lobbying hard to re-write the Friends of the Chair' report on the Terminator - a technology widely condemned by numerous CBD members. Why the sudden spurt of behind the scenes activity? On May 11th, the giant Monsanto Corporation - a company with close White House connections and major multinational muscle - bought control of the Terminator patent. For Governments fighting to protect agricultural biodiversity in the Convention, its now or never.

Monsanto, the world's second largest pesticides corporation, has vaulted from nowhere to become the world's fourth largest seed company. Between mid-1996 and the end of 1997, Monsanto spent roughly US $2 billion in seed-related acquisitions. Its May 11th announcement that the corporation will take over Dekalb and Delta and Pine Land seed companies adds a staggering US $4.3 billion to its merger bill. By way of comparison, if Monsanto's Monday splurge were spent on public sector research, it would fully fund the entire CGIAR system at 1998 levels for over 12 years. But it is not who Monsanto is buying - but what patents it is acquiring - that has observers alarmed. Monsanto now has the Terminator - and maybe much more.

Monsanto's Cotton is King: Less than 24 hours after the take over announcement, US anti-trust authorities were already admitting concern over Monsanto's control of the US cotton seed market. Sometime ago, Monsanto bought Stoneville Pedigree Seed with 12% of the American market. Monday's purchase of Delta and Pine Land (with 73% of the US cotton seed market) for approximately US $1.8 billion gives Monsanto an overwhelming 85% share in the United States and a dominant position in cotton seed markets ranging from Australia and Mexico to China. Monsanto is also negotiating to introduce its transgenic cotton varieties into Argentina and South Africa.

Maize Monopoly: There is no less unease over Monsanto's maize seed activity. The take-over of Dekalb - the second largest maize seed enterprise in the USA - for a stunning US $2.5 billion is hard on the heels of Monsanto's 1997 acquisition of Holden Seeds. About 25-35% of US maize acreage is based on Holden's germplasm. The two purchases make Monsanto the dominant player in the seed industry's most lucrative market. Monsanto's major domestic competitor is the DuPont - Pioneer Hi-Bred alliance that formed in 1997 when DuPont took a 20% position in Pioneer - the undisputed world leader in maize seed sales. Until the May 11th announcement, rumours were rife that DuPont and Monsanto would merge. Some observers still regard this as a possibility. The US firms have to face off the in the global marketplace against Novartis - the Swiss behemoth that ranks number one in pesticides, number two in seeds, number three in pharmaceuticals, and number nine in veterinary medicines. In related deliberations in Bratislava, the Swiss government is actively pushing a proposal elaborated in consultation with Novartis to establish a voluntary code of conduct for industry in access to genetic resources. Critics fear the proposal may be used to derail national legislation in developing countries seeking to implement the principal of equitable sharing of biodiversity benefits called for in the Convention.

Patent Power: The Monsanto patent monopolies are worrying delegations in Bratislava. While pundits and politicians are expressing concern about market share, they have overlooked Delta and Pine Land's major asset - the US patent issued to the company and to the US Department of Agriculture (USDA) just two months ago for the Terminator Technology. The patent on the seed-sterilising technology has been applied for throughout the world and is not confined to cotton. The patent inventors claim that the Terminator will work with any crop. Bratislava negotiators who comforted themselves that neither the USDA of Delta and Pine Land would exercise the clout necessary to impose the technology globally must have had a fearful night. Monsanto has a well-earned reputation of being an aggressive 'enforcer' when it comes to proprietary interests.

Monsanto may also have its eye on a Terminator technology of another sort. The maize market paradigm shifted perceptibly last January 20th when the USDA (again) won patent #5,710,367 covering 'apomictic maize'. Briefly put, the apomixis trait in maize creates reproducible plant 'clones' that speed and easy hybrid seed production - but also open up Third World markets for commercial maize sales. Until now, poor Third World farmers were not a viable market for maize companies since they couldn't afford to buy essentially sterile hybrid seed every year. Apomictic maize can be regrown but because it is a clone, its disease resistance is likely to break down more often - meaning that farmers will be forced to buy seed more frequently. Observers fear that Monsanto will pick up license rights from the USDA (as with the Terminator Technology) and target the South.

White House Connection: Concern about the Terminator Technology - and the security of agricultural biodiversity imperilled by the technology - surfaced early last week in the Bratislava Convention meeting. By the end of the week, countries took the microphone to attack the neutron bomb of agriculture arguing that it would destroy farmer-based plant breeding; jeopardise the food security of at least 1.4 billion people dependent on the food grown by farmers who save their own seeds; and wipe out the South's remaining in-situ agricultural biodiversity. Negotiations within the 'Friends of the Chair' group on agricultural biodiversity led to statements critical of the technology. To the surprise of many, the US delegation sat stoically through last week's debates without actively defending the USDA-supported technology. This lent credence to the rumours that many US government officials were privately horrified by the Terminator development. But following calls back to Washington accompanied by news late on Monday that Monsanto had bought Delta and Pine Land, the US delegation went into action. In the past two years, a number of high-ranking White House and USDA officials have left Washington for the allure of Monsanto's headquarters in St. Louis, Missouri. 'In the scheme of things, Delta Pine was a bit player who got lucky with its USDA research connection,' Pat Mooney of RAFI says, 'the company had little influence in Washington and no knowledge of what was developing in Bratislava.' When Monsanto got wind of the move to call for a ban on the Terminator in the Convention, Mooney adds, 'it made some phone calls. The result is a country that is an observer to the Convention is throwing its bilateral weight around trying to squelch concerns and amend the CBD's conclusions!'

Lord of the Life Industry: Monsanto's appetite for mergers quickened in January 1997 when Monsanto took a giant bite out of the hybrid maize seed market with the US $1.2 billion acquisition of Holdens Foundation Seeds. At that time, industry analyst Dain Bosworth advised that Monsanto's goal was to get its bioengineered seed products on at least half of the (then) 40 million maize acres that Monsanto had access to through acquiring seed companies. Then, last November, Monsanto acquired a major tropical germplasm base with the acquisition of Brazil's Sementes Agroceres - giving Monsanto an estimated 30% market share in the Brazilian maize seed business. Brazilian farmers are seen as a major target for Terminator and/or apomictic maize.

Monsanto has moved beyond transgenic maize and cotton research. In 1996 the company initiated a plant genomic partnership with a leading human genomic company, California-based Incyte 'to generate sequence and expression data from certain plant species, including [maize]'. In October 1997, Monsanto and Millenium Pharmaceuticals (another US-based genomics company) announced a 5 year collaborative agreement worth over US $118 million, including the creation of a new Monsanto subsidiary with about 100 scientists to work exclusively with Millenium to use genomic technologies. The exclusive agreement is not limited to a single crop or geographic location - it covers all crop plants in all countries. Monsanto considers the new subsidiary 'an integral part of its life sciences strategy' and hopes to gain a competitive edge in the search for patentable - and likely 'Terminator-able' crop genes.

Need for Action in Bratislava: 'Let's be absolutely clear,' says RAFI's Edward Hammond from Bratislava, 'This is a technology that deliberately sterilises farmers' fields, that offers zero agronomic benefit, that is openly aimed at the South, and that is now in the hands of a giant, aggressive multinational company with more than enough resources to follow through on the plan. If the CBD does not act and the Terminator is widely deployed, we will be facing a crisis for small farmers and in-situ conservation.'


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