SEEDS STUDY

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Concentration of market power
in the EU seed market
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* “When used in the context of patents, a cross-licensing agreement is an agreement pursuant to which two or more license holders exchange licenses so that each party may
benefit from the other’s patent. Generally, the patents that each party owns cover different essential aspects of a given commercial product. Therefore, by cross licensing,
each party maintains their freedom to bring the commercial product to market. Pursuant to cross licensing, neither party pays monetary royalties to the other party”. Extract
from uslegal.com,
** “A business arrangement in which two or more parties agree to pool their resources for the purpose of accomplishing a specific task”
). For istance KWS and Limagrain have set up a joint venture, Genective, in order to develop GMO traits primarily intended for maize seeds
*** Extract from Monsanto’s Seed Company Subsidiaries, Food and water Watch, April 2013,
how consolidation works
in the seed sector
The seed giants rely on di erent
growth strategies:
Creating customer dependency (hybridisation)
Farmers are sold F1 hybrids that produce less productive seeds in the second generation, and so
farmers are then obliged to buy new seed each year to maintain high yields. In some farming
systems where farm-saved seed has been replaced by dependency on higher yielding (but sterile)
hybrid varieties demanding more inputs, production costs have increased signi cantly.
Protecting their plant reproductive material using intellectual
property rights
Plant breeders' rights (PBRs) or patents.
Horizontal Integration
acquisition of other breeding
companies. Vertical integration
acquisition of seed producing
companies and seed retailers
Building alliances
cross-licensing agreements*, joint ventures**, research partnerships and distribution partnerships.
The seed industry also develops supply agreements with the food processing industry (tomato sauce,
pasta, etc.).
Outsourcing
transferring portions of
work to outside suppliers.
This can be done in particular
with risky operations such as
multiplying.
In order to distribute their own products on the national and local market, a
large seed company can make a deal with smaller seed companies without
owning them. For example in order to distribute their own products.
In addition to the many seed companies that are partially or fully owned by
Monsanto and Seminis, some seed companies distribute Seminis products,
along with other companies' products. This does not mean that these
companies are owned by Seminis or Monsanto, nor do they necessarily supply
genetically engineered (GE) vegetables — Seminis has many products that
are conventionally bred hybrid varieties. But they do bring Seminis products
to the market. ***
HF1
distribution partnership:
the case of monsanto and its distributors