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Monsanto Accused of Price-Fixing

JULIAN BORGER / The Guardian (UK) 7jan04

[More on Monsanto and its products]

 

Washington—Monsanto, the corporate driving force behind the development of genetically modified food, held frequent meetings with its chief competitors and persuaded them to raise the price of GM seeds, it was reported yesterday.

Monsanto has admitted that meetings with senior executives of another agri-industrial giant, Pioneer Hi-Bred International Inc, took place in the late 1990s, but insists they were legal discussions about seed licensing agreements, rather than illegal price-fixing.

However, legal experts said that distinction was murky and predicted that an investigation would be launched.

"The problem is that you have competitors talking to each other, which makes you uneasy," said Lawrence White, an economics professor and antitrust expert at New York University.

"There are lots of legitimate reasons for them to be meeting, but the fact they were talking about prices makes you even more uneasy. You certainly have to worry here and my guess is the [justice department's] antitrust division is going to be looking very closely at this."

The justice department would not say yesterday whether a formal inquiry had begun. It is already investigating Monsanto for anti-competitive practices in the herbicide market.

A New York Times investigation found that executives from Monsanto and Pioneer Hi-Bred - the two biggest seed companies in the world, who account for 60% of the US market in maize and soybean seeds - met repeatedly between 1995 and 1999 to discuss licences under which Pioneer sold genetically altered seeds that had originally been developed by Monsanto.

The report quotes former executives, court papers and other documents as saying those talks involved the prices at which the seeds should be sold and how to keep those prices high.

Executives from two other seed companies, Novartis and Mycogen, said they also came under pressure from Monsanto to coordinate their pricing policies but rejected the approaches as potentially illegal.

Monsanto did not return calls seeking comment yesterday, but a spokeswoman, Lori Fisher, told the New York Times: "Monsanto did offer to expand and revise existing licences with Pioneer. In the context of a potentially new licence for technology, it is absolutely within the law to discuss the price and the means of compensation to the licensing party."

Monsanto's critics have long accused the company of marketing policies aimed at making farmers around the world dependent on its GM technology and its seeds.

In 1999, a group of farmers in the national family farm coalition (NFFC) took the corporation to court, accusing it of forming a cartel aimed at monopolising the market in GM maize and soya seeds. A court rejected the antitrust charges but the NFFC is appealing against the decision.

Bill Christison, the former head of the farmers' coalition, said yesterday. "We are giving away the seeds of the world to a handful of corporations who are going to own all our food production."

source: http://www.guardian.co.uk/gmdebate/Story/0,2763,1117524,00.html 7jan04

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