The Outlook for the Big Six Becoming the Big Three

Syngenta-ChemChina; Dow-Dupont; Bayer-Monsanto. Three agribusiness mega-mergers are streaking for the goal line in 2017. The only obstacles for these combinations are U.S. and European Union regulators. Will any (or all) of them make it past these watch dogs? Farmers have been wary of these mergers, fearful of paying higher prices for seeds and chemicals. Supporters of the deals cite the staggering research, development and regulatory-approval costs of bringing products to the agricultural market. Only the biggest companies with the deepest pockets can compete, the supporters' argument goes. As they see it, the urge to merge may be regrettable but it's unavoidable. Two esteemed former agriculture secretaries, Republican Mike Johanns and Democrat Dan Glickman, offer an interesting wrinkle on the bigger-is-necessary theory. In an opinion piece. They make the case for one of the three mega-mergers -- the union of Dow and Dupont. Their logic? The resulting combination would be American-owned. It's easy for Americans to sympathize with the desire for a national champion ag company. It's harder to articulate why American ownership matters to American farmers. No nation has farmers that spend more on seed, chemicals and other supplies than the U.S. Will Monsanto really start ignoring the American ag market simply because it has a German corporate parent? Will Swiss-based Syngenta change its approach to the U.S. market as a result of being acquired by the Chinese? Chrysler is owned by Italy's Fiat but its Ram trucks are very much aimed at Americans. For that matter, DTN is currently owned by a French company, Schneider Electric. instead of being part of a big chemical conglomerate serving pharmaceutical, industrial and other markets, the Dow-DuPont combination will give birth to a company focused entirely on agriculture. When times are tough in ag land, a "pure agriculture company" won't be as tempted to redirect investment dollars to other product lines. It won't have other product lines.