Not As It Appears

We applaud the Justice Department's investigation of seed industry competition. It has already prompted Monsanto to announce that it will not prohibit farmers from replanting Roundup Ready 1 soybeans when their patent expires in 2014.
However, that announcement may be less significant than it appears. Monsanto has already started selling Roundup Ready 2 Yield, which has a higher price, many years left on patent and somewhat better yields.  

The "Roundup Ready" gene provides resistance to the herbicide Roundup. It enabled Monsanto to introduce "technology fees" and contracts prohibiting buyers from planting the soybeans produced.  Roundup Ready varieties account for 90 percent of US soybeans and over half of corn.

Several factors may discourage continued use of Roundup Ready 1 seed after Monsanto drops the prohibition on replanting.  

"Some nations require licenses for the import of genetically engineered crops to be periodically renewed," according to the New York Times. "Monsanto will maintain those licenses through 2017."  But after they expire,  soybeans produced from Roundup Ready 1 seed could not be exported to certain countries.  That would likely prevent their sale in the general market.

But perhaps the biggest factor that may discourage continued use of Roundup Ready 1 is growing weed resistance to Roundup herbicide. Monsanto is responding with a new gene licensed from the University of Nebraska, for resistance to the herbicide Dicamba.

It appears weed resistance and a new gene to address it arrived just in time to protect Monsanto's dominant position in the seed market as the patent expires on Roundup Ready 1.

Next's week's column will discuss policy implications of growing seed industry concentration.

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