Bayer AG, the owner of the disbanded Monsanto Corporation has bigger litigation to worry about thanks to thousands of Roundup cancer claims. But in the meantime, according to Washington, D.C.-based news website, WTOP, via an Associated Press story, a group of farmers has filed an antitrust case in Idaho against several big agricultural companies, including Bayer, as well as Corteva, Syngenta and BASF. The farmers claim that these ag giants collaborated in an effort to disallow e-commerce sales of their products in order to keep their prices artificially high.
The farmers, all based in Rupert, ID, are seeking class-action status. The case mirrors other federal suits filed by farmers around the country. The purpose of the suit is to force the companies to give up “unlawful profits” and pay compensation to those impacted by the high prices, reports WTOP.
The ag companies are accused by the farmers of conspiring with major wholesalers and retailers to “deprive farmers of a free and open market in order to artificially inflate the price of seeds, pesticides, herbicides, fertilizers and other agricultural products used in planting and raising crops.”
All products referenced in the antitrust lawsuit are what are “crop inputs,” which unlike harvesting farm products, are used in the growth cycle of food crops.
A request for a statement by the Associated Press went unanswered by Bayer and Corteva, while both BASF and Syngenta spokespersons denied the allegations.
Big Ag’s Secretive Supply Chain?
The defendants are accused of creating what’s essentially “a secretive supply-chain process.” And in creating this process, farmers are unable to comparison shop; retailers were pushed out of the competition. Consequently, because of the secretive supply chain, some farmers have been forced into bankruptcy as the costs of crop inputs have skyrocketed, vastly outpacing crop yields. For example, according to the suit, corn seed has risen by 300% over the last 20 years while corn yields increased less than 35%.
“These increases are proving increasingly devastating to farmers, who are now the least profitable level of the American food supply chain and are drowning in hundreds of billions of dollars of operating debt that is forcing them into bankruptcy at a record pace,” wrote the plaintiffs’ lead attorney, Vaughn Fisher of the Boise law firm, Fisher Hudson Shallat, in the suit.
According to the lawsuit, the Federal Trade Commission and the U.S. Department of Justice have launched investigations into the defendants’ actions.
Farmers who need to purchase crop-growing products normally have to go through an authorized wholesaler or a retailer selected by the product manufacturer. The wholesalers and retailers, according to the antitrust suit filed by the farmers, sign confidentiality agreements; are offered incentives to reach sales targets, and sometimes have to purchase seeds that are relabeled because they have been sitting on the shelf for a long time.
These rebranded seeds are often sold at higher prices, the suit contends. Furthermore, farmers may have a difficult time figuring out how much they’re being charged for individual products. That’s because seeds and herbicides and pesticides are sold in package bundles.To read the full report at WTOP, click here.