Healthy soil and sustainable growing

["TradingPostPaul" <tradingpost@riseup.net>]

The Seminis news came out last year, but this article sheds more light on
it.  Getting and preserving diversity in traditional seeds is more urgent
than I had thought.

paul tradingpost@lobo.net
----------------

"And We Have the Seeds"
Monsanto Purchases World’s Largest Vegetable Seed Company

“Monsanto Company to Acquire Seminis, Inc., a Leading Vegetable and Fruit
Seed Company

Acquisition Expected to Add Near-term Income Growth and Diversity to
Monsanto's Seed Portfolio

ST. LOUIS (Jan. 24, 2005) - Monsanto Company (NYSE: MON) announced today
that it signed a definitive agreement to acquire Seminis, Inc., for $1.4
billion in cash and assumed debt… “

The news of Monsanto’s agreement to purchase Seminis has received little
attention from the media other than the financial pages and a few seed
industry and anti-globalization web sites. But then again, why should it?
How many consumers – of food or seed – have even heard of Seminis? And
yet, as Seminis spinmeister Gary Koppenjan said, “If you've had a salad,
you've had a Seminis product."

It is estimated that Seminis controls 40 percent of the U.S. vegetable seed
market and 20 percent of the world market—supplying the genetics for 55
percent of the lettuce on U.S. supermarket shelves, 75 percent of the
tomatoes, and 85 percent of the peppers, with strong holdings in beans,
cucumbers, squash, melons, broccoli, cabbage, spinach and peas. The
company’s biggest revenue source comes from tomato and peppers seeds,
followed by cucumbers and beans.

In large part, these numbers reflect usage of Seminis varieties within
large industrial production geared towards supermarkets, but Seminis seeds
are also widely used by regional conventional and organic farmers as well
as market and home gardeners. Johnny’s, Territorial, Fedco, Nichol’s,
Rupp, Osborne, Snow, and Stokes are among the dozens of commercial and
garden seed catalogs that carry the more than 3,500 varieties that comprise
Seminis’ offerings. This includes dozens of All-American Selections and
an increasing number of varieties licensed to third parties for certified
organic seed production.

The brand-name companies under Seminis (such as Petoseed) have developed,
released, produced and distributed varieties common to the market farmer
and even home gardener. These include Big Beef, Sweet Baby Girl and Early
Girl Tomatoes; Simpsons Elite and Red Sails Lettuces; Red Knight and King
Arthur Peppers; Gold Rush and Blackjack Zucchinis; Stars & Stripes Melon;
and Bush Delicata and Early Butternut squashes (see sidebar for other
popular varieties).

Many of the Seminis varieties are derived from their in-house breeding
programs, as well as industry alliances with DuPont, and university
partnerships with the likes of Cornell, Texas A & M and the University of
California. The company’s F1 hybrid genetics are considered excellent in
many areas, including overwintering brassicas, disease resistance in
cucurbits, packing qualities in green beans, and flavor in tomatoes.
“Organic farmers love our product,” Koppenjan told me, “We have the
disease resistance, and this is more important in organics than
conventional, where farmers have more disease-control options.”

The implications of Monsanto – often associated with the antithesis of
the organic movement – purchasing a company that serves the organic
community are complex. This has certainly been the catalyst for the emails
that some catalog companies are receiving. Both Johnny’s and Territorial
have received strikingly similar missives with nearly the same wording,
demanding that the firms reveal their Seminis’ varieties “so I can
avoid them at all costs. Otherwise I’ll toss your catalog.” Seed
catalogs may see more of this, as Monsanto is a large target amongst those
concerned with globalization.

While voting with ones dollars can be an effective tool of change, it is
also important to recognize that these are also seed catalogs that have
recognized the needs of smaller organic producers, offering strong lists of
regional varieties and expanding their certified organic selections. None
of these companies was overjoyed with news of the acquisition, and they all
seemed to be in different phases of analyzing its impact. It’s not an
easy task. Seminis’ varieties account for 11 percent of Fedco Seed’s
gross sales, and the numbers are much higher in categories like melons and
squash. While Fedco founder C.R. Lawn expressed his personal inclination to
have nothing to do with Monsanto, the volume of sales demands careful
consideration. Fedco is surveying its staff to decide how to respond, with
options ranging from phasing out all Monsanto-Seminis varieties to putting
a “tax” on these varieties and using this money to fund regional
grassroots seed development.

For some growers and seed catalogs, this may seem a non-issue; what matters
to them is the quality of the variety, not the politics of who owns that
variety. And even if one does care and would like to take one’s business
elsewhere, there may not be immediate replacements for many of the Seminis
varieties. The economic impact of abandoning a variety that keeps the cash
flowing cannot be easily overlooked. For others, the Monsanto connection
may be a line that can’t be crossed. Regardless of one’s stance, the
acquisition offers a history worth tracing in the continuing trend of food
industry consolidation, a lesson that should give everyone pause to
consider the future of seeds.

In the early 1990s, billionaire Alfonso Romo, descendent of a Mexican
president, Olympian athlete in horse jumping, bakery and beverage mogul,
and owner of Ciagarrera La Modena – Mexico’s largest cigarette company
– set out to become the global king of vegetable seeds. Romo had watched
agrochemical companies gobble up seed businesses in the larger agronomic
crops like corn, and he noticed that there was little attention being paid
to the ‘minor crops’ of the vegetable seed industry. By 1994, he had
succeeded in building Seminis, purchasing longstanding seed companies such
as Asgrow, Petoseed (which had recently purchased the Dutch firm Royal
Sluis) and dozens of Asian seed companies. Seminis grew quickly, thrived
and went public (trading as Empresas La Moderna or ELM, the former parent
company of his cigarette firm—which Romo sold in 1997 for $1.5 billion).

According to seed industry insiders, one of the company’s strengths was
also its weakness. Early on, it benefited from internal competition,
retaining the brands such as Petoseed and Asgrow and allowing Seminis
breeders to vie for product development and placement. This may have led to
excessive inventory – the company’s list swelled to near 6,000
varieties at one point before cutting a whopping 2,500 varieties in 1998
(and leaving more than a few farmers looking for new varieties).

In 2003, Seminis was in a financial slump; shares slipped to around 50
cents each from previous highs of more than $7 a share. Fox Paine and Co.
– a firm specializing not in agriculture but in buyouts – stepped in to
purchase majority control of the company and stabilized the slide.
Financial analysts and the seed trade were waiting to see the fate of the
gene giant in the hands of this holding firm. With the Monsanto
announcement, the wait is over. The purchase catapulted Monsanto past rival
DuPont (Pioneer Seed), making them the world’s largest seed company –
first in vegetables and fruits, second in agronomic crops, and the
world’s third largest agrochemical company.

This is not the first time Seminis and Monsanto have done business. In
1997, Monsanto began to insert its Roundup resistant gene into one of
Seminis’ lettuces, with an agreement to split the premium fifty-fifty. A
1999 Wall Street Journal article also noted that Seminis had received U.S.
regulatory approval for selling disease-resistant genetically engineered
squash and tomatoes with longer shelf lives and that the firm was working
on using biotechnology to create sweeter peas and worm-proof cucumbers. In
the same Journal article, Romo envisioned a Seminis future with biotech
crops such as non-browning lettuce, broccoli with enhanced cancer-fighting
properties, and spoil-free produce. "Seeds are software," he was quoted as
saying, "and we have the seeds." Romo will stay on as Chairman and CEO of
Seminis under Monsanto, according to the company’s press release
announcing the deal.


Conjecture and Concern

While news of Monsanto’s acquisition of Seminis was less than a blip on
the general public’s radar, small groups of farmers, activists and seed
trade professionals immediately began to connect to discuss the
ramifications on a variety of list serves and web sites over the Internet.
The professionals I spoke with for this article – Mark Hutton (former
plant breeder for Peto now at University of Maine Extension), C.R. Lawn,
Rob Johnston (founder, owner and plant breeder of Johnny’s Selected
Seed), Frank Morton (Plant breeder and owner, Wild Garden Seed), and
Michael Sligh (Policy Director, RAFI) – were in concurrence with the
concerns expressed in the online group discussions, first, with regard to
the potential decrease in varietal selection for farmers, and second, in
the potential acceleration of biotech applications in the vegetable sector.

One can only speculate on Monsanto’s motives for purchasing Seminis. We
can make educated projections, just as Wall Street financiers have done on
news of the acquisition. Financial and agricultural professionals
interviewed in the mainstream press, such as Don Basse of the commodity
advisory group Agresources, have surmised that the acquisition can be
profitable for Monsanto only with the application of biotechnology – as
Seminis conventional seed business was nearly half a million dollars in
debt and continuing to lose money.

Basse says that it would be logical for Monsanto to use biotech to increase
the nutritional value of fruit and vegetables as opposed to focusing on
shelf life or devising pest-resistant strains. Monsanto’s press release
noted that “Biotechnology applications could be an option, and will be
evaluated in the context of Monsanto's research-and-development priorities
and potential commercial business opportunities.” However the main tone
of the announcement focused on the trend of nutrition and healthy
lifestyles. Monsanto’s CEO put it this way, “The addition of Seminis
will be an excellent fit for our company as global production of vegetables
and fruits, and the trend toward healthier diets, has been growing steadily
over the past several years.”

“You have to ask yourself why they (Monsanto) would decide to buy this
seed company,” was the thought first shared by Rob Johnston of Johnny’s
Selected Seeds, “Their Roundup herbicide patent is expiring, so their
future profits are in the biotech traits…I think they’re going to push
and see if consumers will accept it.” C.R. Lawn of Fedco was less
certain, feeling that Monsanto would not be bold enough to try and sell
such technology to consumers and farmers, particularly after GMO wheat was
recently shelved because of the lack of perceived public acceptance. There
is also speculation that if Monsanto can slowly start building the GMO
vegetable-fruit market, then the debate over GMOs will become a moot point,
as they will have made their way onto the plate and thus gained acceptance
(or at least acquiescence).

Even if one does not believe that GMO vegetables will be in the Wendy’s
salad bar in short order, there is more pressing concern that Seminis will
drop many of the hybrid and open-pollinated varieties that regional farmers
currently depend upon. Prior to the buyout, the company’s main product
focus had continued to move towards supplying genetic for the larger
centers of production. “It’s not like they’re still breeding tomatoes
for the Northeast” Rob Johnston noted. Still, Johnston conceded that it
would be difficult for Johnny’s to replace some of the Seminis varieties
that their customers turn to year after year, such as Gold Rush Zucchini or
King Arthur Pepper. Yet he feels certain that cuts are coming. Johnston was
disappointed with the news, in part he said because he likes not only the
quality of product but the Seminis breeders themselves, “I worry about
the future of their breeding programs, that they (Monsanto) will curtail
creative directions and focus them on a Monsanto agenda.”

Organic Seed Alliance has received over a dozen emails and phone calls from
concerned farmers. Minnesota farmer Jim Fruth contacted us for assistance
in “dehybridizing” a Seminis hybrid pepper that has recently been
dropped. Like many farmers, Fruth has integrated particular varieties into
his production and marketing plans and he says he is now without a variety
that is “a vital part of my livelihood.” Nash Huber of Sequim,
Washington, said that, after vast trialing, he had found that Seminis
cabbage varieties have excellent post-harvest holding capacity, extending
his marketing season and farm profitability. He did not have high hopes of
finding replacements.

Mark Hutton worked as a squash and eggplant breeder for Petoseed before it
was purchased by Seminis. From his perspective, farmers like Fruth and
Huber should start trialing new varieties soon. “Monsanto is going to
look at this from a bean-counter perspective. Low margin varieties get
dropped, and this means anything that’s not for large commercial
production.”

One seed catalog owner I spoke with believes that farmers should not react
to the news by seeking non-Monsanto/Seminis seed sources. He said there is
no indication Monsanto will drop these varieties and that rushing to find
replacements isn’t an answer. “Where are you going to go? Some of these
varieties are irreplaceable. Are we really going to drop or boycott some of
the best material out there because we don’t like Monsanto?” He warned
that doing so might only accelerate the downsizing of the Monsanto product
list, leaving farmers in a real lurch. “The process of breeding
alternatives to these (varieties) is a long, longterm project. And what are
you going to plant in the meantime?”
Most of the people I spoke with agreed that there are few options; this is
what is making them react to the news so passionately. In a healthy
competitive market, a producer has more than one cog to choose from, giving
the producer freedom to switch suppliers if they have an issue with their
traditional supply chain. In a highly consolidated system, this choice is
not easily apparent and may simply not exist.

Consolidations in the seed world are nothing new. The impact is
predictable: A few breeders lose their jobs, farmers scramble to find
another variety to fit their production system but something eventually
comes along, stockholders either make or lose money, and, in the end, food
still winds up on the plate of most American households at 7a.m., noon and
6 p.m. We’ve been here before in recent times, and we’ve seen even
bigger control of seed ownership and distribution (although not in any of
our lifetimes).

A-century-and-a-half ago there was only one mega-distributor of seeds in
this country. Lobbying and activism brought about its demise. That
distributor was the United States government, and the rabble rousers who
broke that monopoly were none other than the American Seed Trade
Association – whose largest modern financial benefactor is none other
than Monsanto.


A Brief History of the Development of the Seed Industry –
The Shift from Public to Private Seed Systems

One hundred fifty years ago the United States did not have a commercial
seed industry; today we have the world’s largest.* Some view this as real
progress, a form of genetic Manifest Destiny. A nation once a ‘debtor’
in plant genetics now supplies the world. In 1854, seeds were sourced in
the U.S. by way of a small number of horticultural seed catalogs, farmer
(or gardener) exchange, on-farm seed saving, and through the beneficence of
the United States government. Specifically, beginning in the 1850s, the
U.S. Patent and Trade Office (PTO) and congressional representatives saw to
the collection, propagation and distribution of varieties to their
constituents throughout the states and territories. The program grew
quickly so that, by 1861, the PTO had annual distribution of more than 2.4
million packages of seed (containing five packets of different varieties).
The flow of seed reached its highest volume in 1897 (under USDA management)
– with more than 1.1 billion packets of seed distributed.

The government’s objectives in funding such a massive movement of seed
stemmed from the recognition that feeding an expanding continent would
require a diversification of foods. To the early colonies, the introduction
of wheat, rye, oats, peas, cabbage and many other vegetable crops was as
critical to food security as was the adoption of the corn, beans and
squash. Immigrants were encourage to bring seed from the old country,
founding fathers such as Thomas Jefferson engaged in seed-exchange
societies, and by 1819 the U.S. Treasury Department issued a directive to
its overseas consultants and Navy officers to systematically collect plant
materials.

The first commercial seed crop was not produced until 1866—cabbage seed
produced on Long Island for the U.S. wholesale market. The industry
flourished to some degree, but early seed trade professionals felt their
growth was stymied by the U.S. government programs as well as the
self-replicating nature of their product (that is, the factory contained
within that product). In 1883, the American Seed Trade Association (ASTA)
formed and immediately lobbied for the cessation of the government
programs. The organization developed powerful allies, such as Grover
Cleveland’s Secretary of Agriculture, J. Sterling Morton, who wrote that
the government giveaway was “antagonistic to seed as a commodity-form and
in direct competition with the private seed trade.” But the program was
very popular with constituents, and the USDA’s seed budget was kept
intact – at one point counting for a full 10 percent of the agency’s
overall annual expenditures.

In the early part of the 20th century, the first wave of hybrids began to
provide seed companies with a potential increase in product profitability
(as farmers would now need to return to the seed distributor for materials
each year). However, most of the hybrid development was occurring at Land
Grant Universities, and these universities refused to give the companies
exclusive rights to the seed. Once again, the industry felt its growth
hindered by federal programs and complained of unfair trade practices.
Mounting data also indicated a slowing in yield increases from seed
developed in government programs. The industry used this last point to
strengthen its argument for the privatization of seed development in order
to foster greater food security.

In 1924, after more than 40 years of lobbying, ASTA succeeded in convincing
Congress to cut the USDA seed distribution programs. The USDA still
supported breeding at the state agricultural schools, and for a time these
programs continued to compete with seed companies by developing
‘finished’ commercial varieties. Associations such as the American
Society of Agronomy and American Society of Horticulture Science eventually
convinced the public programs that their appropriate role was in training
plant breeders, performing fundamental research, and creating raw materials
and technologies for private industry to capitalize on. The LGUs began to
increasingly serve in this capacity, developing inbred parental lines and
breeding stock that the seed trade would use to create proprietary
varieties.

These changes in the public role, along with improvements in hybrid
techniques, led to the growth of the seed trade following World War II. The
trade was well represented during this period by regional companies. The
conversion to monocropping and large-scale corporate agriculture had not
yet moved into full swing. The Santa Clara Valley grew vegetables and fruit
and not internet startups, and Americans still planted their Victory
Gardens. The seed trade reflected this diversity in food production.

In the 1960s, a few larger seed firms began to purchase smaller companies
(mostly to acquire strong hybrid holdings). But the consolidations of this
period were minor compared to the frenzy that would come with a Supreme
Court ruling on June 16, 1980, in the case of Diamond v. Chakrabarty. Prior
to the Chakrabarty decision, a plant (or animal) could be owned, but the
genetics could not. This case cleared the patenting of life forms on the
bases of their genetic coding. The PTO granted more than 1,800 such patents
following the ruling. Companies that had no historical seed
interests—primarily chemical and pharmaceutical firms—began purchasing
seed companies. In a few short years, there were billions of dollars in
mergers and acquisitions—with little to no regulatory
oversight—creating for the first time a majority ownership of plant
genetics by a few multinational companies. No other natural resource
(marine, timber, minerals) has ever shifted from public to private hands
with such rapidity, such intensity of concentration, and so little
oversight.


The Immediate and the Future

“There is a direct threat to our food system when we have a preponderance
of genetic resources controlled by institutions whose only goal is
profit,” plant breeder Frank Morton expressed emphatically when asked for
his perspective on the Monsanto acquisition. He went on to compare the
present with the past, “When these services [breeding and production]
were diffused amongst many individuals and groups with diverse motives, we
had a much more diverse and healthy food system.”

Diversity and competition have historically made for healthier economies as
well as ecologies. Ecological and economic systems have another thing in
common; as one group abandons a niche, it leaves room for others to move in
and utilize it. Many of the seed company representatives and breeders I
spoke with felt that the organic community can and should develop a less
centralized seed system. Steve Peters, seed procurement manager for Seeds
of Change, shared his firm’s vision: “Part of our strategy is to go
into neglected markets and respond to these needs. We want to offer true
organic alternatives; this means we not only pay attention to the regional
needs but also have a different approach to breeding – building new
alliances in crop development. We’re not chasing single-gene resistance
but looking at horizontal resistance in traits like Downy mildew in
spinach.”

Adaptability has historically been an integral part of the organic
movement– responding to customer inquiry and opinion, personal service (a
face on the food), localized and decentralized – all traits that help
make the organic sector healthy and promote its vigorous growth. “The
organic seed world is where the organic produce market was twenty years
ago,” said veteran organic grower and seed producer Nash Huber.
“Produce quality wasn’t always so great then, but we worked it out and
now are better than the conventional systems. The potential in seed is that
the customers – we farmers – will see that, in the long run, an organic
seed trade will serve us.” Farmers like Huber are investing in the
organic seed trade. He works as an educator in the Organic Seed
Alliance’s WSARE organic seed production trainings, is leading a
participatory plant breeding project with the Alliance, and produces seed
for the organic seed trade as well as his own on-farm use. Carrots are the
main cash crop on Huber’s 400-acre farm, and he produces 80 percent of
his own seed to insure quality and availability. “I can’t afford to
have a company drop my source,” he explained.

Seed companies and farmers are not alone in their rising to meet the need
for changes in the seed world. In 2003, more than 70 university breeders,
representatives from farmer-based NGOs, and policy specialists met at the
“Summit for Seeds and Breeds for the 21st Century” in Washington, D.C.
The breeders who represented a diverse set of crops, from schools that have
traditionally served clients of large-scale Green Revolution style
agriculture, called on each other to “reinvigorate public breeding” to
meet the needs of organic and sustainable agriculture. The group will host
a full-blown conference in Ames, Iowa, in September 2005.

While the seed consolidation trend seems to have reached a particularly
dark moment in the Monsanto-Seminis acquisition, it may also serve to fuel
a momentum in the developing organic seed community. The issues are
immediate and fraught with complexity; the answers are long-term and
require commitment. Said C.R. Lawn of Fedco, “We need to keep working on
creating a farmer breeding community. But this is long, slow work. You find
and replace varieties one by one. You work slowly in the direction you want
to go. Seed work is slow work.”

- Matthew Dillon