In a rapidly consolidating sector already dominated by just a handful of players, Bayer AG’s $66 billion deal with U.S.-based Monsanto Co. has significant negative implications for farmers and the industry, experts say.
Bayer BAYN, -0.80% and Monsanto MON, -0.67% are major manufacturers of agrochemicals, seeds and genetically modified crops. There are concerns that such genetic engineering cuts down on natural biodiversity and exposes the food supply to risk from disease and unpredictable weather.
Bayer announced the agreement early Wednesday, months after the company made its first offer for Monsanto. It would raise its offer twice before Monsanto agreed to the final $66 billion, including debt.
The consolidation of two big industry players into one of the world’s largest agrochemical firms may also limit farmer choice and bargaining power, with increasing seed prices expected to be passed on to the grocery aisles.