Farm groups are adopting a wait-and-see approach to the Justice Department-USDA announcement committing to work together to maintain competition in the inputs sector.
Ag Secretary Brooke Rollins, speaking at the annual Ag Outlook Forum sponsored by Agri-Pulse and the Agricultural Business Council of Kansas City, said farmers shouldn’t have to deal with “sky high” input prices in the midst of a multiyear downturn in the commodity market.
In announcing a memorandum of understanding with DOJ, Rollins listed significant price increases for fertilizer, seed, feed and other crop inputs in her talk at the forum, emphasizing that “this is a new, populist GOP.”
After the Rollins announcement but before the text of the MOU was released, American Seed Trade Association President Andy LaVigne said, "We remain committed to ensuring that U.S. farmers have reliable access to high-quality, professionally produced seed, every season, and especially during uncertain economic times.”
Meanwhile, Daren Coppock, president and CEO of the Agricultural Retailers Association, said in a statement, “ARA supports efforts to ensure fair and transparent market conditions for essential crop inputs, as well as polices that boost competitive domestic markets and trade policies that facilitate product access and export markets.”
Asked for comment, ChemChina-owned Syngenta kept it short, releasing a statement saying only, “‘Syngenta looks forward to working with USDA to better serve American farmers.”
Independent seed group wants action
Todd Martin, CEO of the Independent Professional Seed Association, said his organization welcomes the new effort, but said he had no quick answers to issues surrounding seed development and intellectual property.
Todd Martin (X photo)“I applaud that Secretary Rollins is looking into this,” he told Agri-Pulse. However, he noted that the Justice Department “has been looking in this area, literally since 2017. It’s been eight years. It’s time to get something done. I'd like to see some fortitude out of the Department of Justice to actually say we have the strength of character to go and address this issue for the betterment of the American farmer and for the betterment of all Americans.”
But the issues involved are “immensely complicated” and cross jurisdictional lines, involving the U.S. Patent and Trademark Office and the Federal Trade Commission, as well as USDA and DOJ, said University of Wisconsin emeritus professor of law Peter Carstensen.
“I am pleased that they are continuing to focus on these issues,” he said. “And they are complex issues.”
Martin says he has nothing against the large players in the market – Bayer, Syngenta, Corteva and BASF – but that patent protections can stifle innovation.
“They have brought forth great innovations,” he said. “They have really done great stuff. What I am saying is it's time … to see more innovations coming out of them that are going to be game-changing like it was in 1995” when Roundup Ready seeds were introduced.
Martin would like to see the rise of a generics market when many corn biotech patents expire in 2027, he said.
“If the DOJ is doing its job, and we're doing our job as an industry, we should see a flood of generic products, lowering input costs because of those patent expirations,” Martin said. But he quickly adds, “I do not believe that will happen.”
Part of the problem is the number of parts of a plant that can be patented.
Cut through the clutter! We deliver the news you need to stay informed about farm, food and rural issues. Sign up for a FREE month of Agri-Pulse here.
“I think we are far too generous in what we currently see recognized by the patent office as a true invention,” Carstensen said.
When a farmer buys SmartStax PRO, for example, “he's buying a product that probably has anywhere from five to 10 underlying patents on that product, just in that one seed. And all of those end up making that one seed have potentially an exceptionally long patent life.”
Some competition initiatives axed
The Biden administration had already put a lot of work into the issue of competition, especially in the seed industry, but it's not clear how much of that will continue. Ag Secretary Tom Vilsack, contacted about the MOU, pointed to a number of actions, including establishment of a Farmer Seed Liaison initiative in 2023.
Tom Vilsack (Agri-Pulse photo)“The goals of the initiative are to enhance transparency in the seed marketplace; amplify the voices of growers, seed producers, and others in the seed system; and promote broader access to seeds for research and plant breeding,” according to the initiative’s website. It also has helped farmers navigate the complex patent structure.
USDA under Vilsack also established a website for farmers – usda.gov/farmerfairness.gov – “who felt they were not being treated fairly to let us know of their concerns so DOJ could investigate,” Vilsack said in an email.
The contract for the Farm Seed Liaison initiative, however, was terminated in July, as were other cooperative agreements that had been set up to fulfill a Biden executive order on fair competition, said Julie Dawson, a plant science professor at the University of Wisconsin who worked on the seed liaison initiative.
She said she was disappointed the contract was terminated, but hopeful that with the MOU in place, USDA will continue working on competition issues for farmers.
"We're hoping that they take what we did and that would continue to inform their priorities, especially looking at reasons that prices are really high for farmers, reasons that farmers might not have the choices that they want in seed, and other aspects like contracts that might restrain competition or the ability for many different companies to offer choices to farmers in terms of varieties," she said.
Another initiative, the Agricultural Competition Partnership, was set up in 2022 to provide funding to state attorneys general offices working on fairness and competition in the food and agriculture markets.
That also was terminated in July. In a letter, Agricultural Marketing Service Administrator Erin Morris said AMS had, “in the course of conducting its review … determined that this cooperative agreement tied to competition issues no longer aligns with USDA’s policies/priorities, programming, and resources. Accordingly, it is necessary to terminate the agreement to refocus AMS’s limited competition resources, meet the department’s goals, and ensure financial assistance effectuates agency priorities.”
The program was run by The Center for State Enforcement of Antitrust and Consumer Protection Laws. Executive Director Emily Myers told Agri-Pulse she couldn’t say “what, if any, projects won't be undertaken because of the termination, in part because the projects are mostly confidential, and in part because the grant term was until May 2028, so we don't know what projects might have been proposed in the future.
“We hope to continue to work with USDA through the Agricultural Marketing Service on projects of mutual interest,” Myers said.
Carstensen said he’s “absolutely delighted that USDA and DOJ are cooperating and looking to take a serious interest in this set of problems.” However, he’d rather they not “reinvent the wheel” when a lot of work in the area of antitrust has already been done. He specifically cited the Farmer Seed Liaison initiative.
