Farmers Face the Consequences of a Consolidated Seed Industry
The seed industry has quickly consolidated. The U.S. Department of Justice announced in August 2009 that it would investigate alleged anticompetitive conduct in the seed industry largely because a few dominant firms now control much of the seed supply.
Ten companies account for about two-thirds (65 percent) of the world’s proprietary seed – that is, branded varieties subject to intellectual property protections – for major crops. Economists say that an industry has lost its competitive character when the concentration ratio of the top four firms is 40 percent or higher. In seeds, the top four firms account for 50 percent of the proprietary market alone and 43 percent of the commercial market , which includes both proprietary and public varieties. This level of concentration has proven problematic, reducing choice and increasing prices for the average American farmer. Several factors have contributed to concentration in the seed industry…