Reader Comment: Monsanto-DPL Merger

From Samuel C. Wilson:

There are all kinds of athletic shoes: running shoes, cross-trainers and basketball sneakers to name a few. The three largest athletic shoe brands – Nike, Adidas, and Reebok – design models in various styles. Nike has its "Shox", Adidas its "Shelltoes" and Reebok markets its old-school "Pumps".

But regardless of style and design, one common component to all of these shoes is the shoelace.

Now, imagine if one of these brands was able to acquire - through merger - the company that produces all shoelaces.

The newly merged company could decide to only license laces that fit their brand. Athletic shoe consumers would then be limited in choice, only able to purchase one brand of shoes (those with laces) while the other brands would have lost any incentive to maintain production as their shoes would then be essentially unwearable (without laces).

This scenario is now analogous to a similar pending merger in an entirely different industry, cotton production. Monsanto, the agricultural biotech and seed giant based in St. Louis, is making a second attempt to acquire cotton seed giant Delta & Pine Land (the largest in the US at $417 mil in annual sales), based in Scott, Mississippi.

The antitrust and financial crowds have weighed in and are speculating in anticipation of the Department of Justice's decision, but it's likely that farmers are the most nervous. If the cotton seed market is allowed to be monopolized – seeing vertical integration from the biotechnology involved (the shoelaces) to the actual supply of the seed (the shoes) – it only follows that Monsanto's other two strongholds – corn and soybeans – could be streamlined as well. Eventually, the markets for the nation's most lucrative three cash crops could be under Monsanto's control from top to bottom.

Most of Monsanto's preventive biotech traits have been successful. It could be argued that they have allowed more people to eat because the farming process has become more efficient and cheaper – and farming has been made possible in more parts of the world. But the problem lies in the quality of the product. Farmers surely enjoy the choice of using seeds and seed traits that best suit their local conditions. Sometimes these products are developed and sold by independent retailers, so eliminating these competitors diminishes the farmer's choice and, ultimately, the choice of the consumer.

It seems that the interests of the farmer and consumer – a much larger community than the antitrust and financial commodities crowds – are the most closely aligned. If they can't get the laces, we can't wear the shoes.

- Samuel C. Wilson is a third year student at the George Washington University Law School in Washington, D.C.