Monsanto Company is a multinational seed corporation that has become one of the largest and most powerful companies in the world— completely unrecognizable from its humble beginnings in 1901.  Monsanto was founded by John F. Queeny in order to produce saccharin, an artificial sweetener that is used to replace sugar.  As the years progressed, Monsanto started becoming larger and having larger customers such as Coca-Cola.  Twenty-seven years after starting the company, Queeny passed it on to his son Edgar and it began to become the huge corporation it is known as now.  Under Edgar’s control the company was renamed to Monsanto Chemical Company and started focusing on producing products that became crucial to the US military.  During the Vietnam War, Monsanto became a government contractor and manufactured Agent Orange as an herbicide to be used on Vietnamese jungles.  This role later hurt Monsanto when in the ‘80s, American veterans sued the company for exposing the troops to a chemical that was known to have harmful effects. The company ultimately settled the suit for $180 million (Bravo).  Monsanto introduced Roundup in the mid-1970s and the product is still the most widely used herbicide in the world.  Genetically modified seeds, or GM seeds, were first discovered by Monsanto scientists in 1982 and are now the company’s largest selling product (Bravo).  They used this technology to introduce their Roundup Ready seeds. These seeds produce crops which can be sprayed with herbicide and survive. This meant that agriculturists could spray Roundup in order to kill weeds in the fields without risking their crops.  Just before the turn of the century, the company came under the leadership of Robert Shapiro.  During this transition, the company sectioned off its chemical activity research into another company to focus on biotechnology.  Throughout the twenty-first century, Monsanto became known for using scare tactics and large corporate lawsuits to protect its patents while forcing farmers to pay more for seeds. A well-known example of Monsanto scaring smaller businesses is one against the Pilot Grove Cooperative in Missouri. Monsanto began the court case in 2006 after they received information that the Cooperative was saving seeds to reuse in the next year, which is against Monsanto’s seed patent.  Eventually the case ended with Pilot Grove, a company with seven employees and four computers, giving $275,000 to local agricultural scholarships and agreed to buy $1.1 million of Monsanto products for the next six years (Bravo).  As the opposition to genetically modified organisms has grown in popularity, particularly amongst sub-cultures like adolescents and the health conscientious, many have grown weary of the Monsanto brand. Although this is more than a valid reason for people to dislike Monsanto, the American people should consider another threat Monsanto poses to the nation. They are also taking away the freedom of business that the United States is known for.  These unorthodox business methods and their buying out of other seed companies has many to believe that they are a modern-day monopoly, and should be downsized or separated into completely different companies.

The Federal Trade Commission defines a monopoly as “a firm with significant and durable market power,” and monopolies are restricted by the government underneath the Sherman Anti-Trust Act.  This act was first established in 1890 to break up the monopoly of John D. Rockefeller’s Standard Oil Company.  Standard Oil is seen to be the first monopoly of modern day.  They implemented all three types of monopolization, vertical, horizontal, and creation of trusts.  Vertical integration is when a company buys all the levels of production.  In Standard Oil’s case, they bought the companies who mined, transported, and refined the oil.  By doing this, a company can keep their prices lower because they control all the aspects of production.  Horizontal integration is when a company buys out all their competition so if another company tries to start, they can easily overpower them and forcing them to either shut down or sell out.  Standard Oil would lower their prices to a point where newer, smaller companies could not. This forced the smaller companies to go out of business or settle.  A trust is a business tactic used by large corporations to help each other out.  A trust is formed by two or more companies coming together to allocate their assets and trade stocks.  This integrates the businesses together so that their costs of production are reduced.  In and of itself, lowering production costs is not a bad thing. However, in extreme cases, this can be a problem because the companies can lower their costs so much that opposing businesses cannot afford to compete.  By implementing these different methods of monopolization, Standard Oil controlled ninety one percent of production and eighty five percent of final sales, similar to Monsanto’s control over the seed industry.  The Federal Trade Commission also does not consider a company a monopoly unless they control at least fifty percent of the market, a point Monsanto passed years ago. 

The seed market has become monopolized by Monsanto’s genetically modified seeds.  They control over three fourths of the market sales in the top three major seed markets. The main three seed types produced by Monsanto and purchased by farmers are soy, corn, and cotton.  Soy is mainly used for its oils and proteins to produce feed for animals, but some soy is used for human consumption.  Ninety three percent of soy grown in the US are GMO seeds produced by Monsanto. Corn is used in everything from food to ethanol in gasoline.  Eighty percent of corn grown in the US are also grown with GMO seeds produced by Monsanto and ninety five percent of corn seeds contain Monsanto’s herbicide resistant genes.  Cotton is mainly used for clothing, but can also be turned into cottonseed oil for cooking and other products such as soap, cosmetics, and plastics.  Around eighty nine percent of cotton seeds grown in the US contain Monsanto’s herbicide resistant genes (Kaldveer).  These numbers show how much of the crops grown in the US and the food we consume is controlled by Monsanto.  On Monsanto’s website, they claim that farmers have the option to buy seeds with their herbicide resistant genes from around two hundred other companies that they have loaned their patent to.  The reason that Monsanto has given their patent to these companies is because they own them, not because Monsanto voluntarily gave them the rights to produce their seeds (Seed Companies).  

Monsanto has mainly implemented horizontal integration, buying out smaller companies to increase market share, in their business practices because they will buy out smaller seed companies to decrease their competition. We can see this lowered competition by the percentage of each market that Monsanto controls.  When a company controls a higher percentage of the market, that company can more easily manipulate the market by raising prices without competition.  In 2005, Monsanto acquired a company by the name is Seminis, they are known for their control over the less major seed markets, like fruits and vegetables (PlanetInfowars). This purchased increased their control over not only the major seed markets, but the lesser known ones. Another example of Monsanto’s recent acquisitions is their purchases of heirloom seed companies and heirloom seed trademarks.  Monsanto has always been known as a genetically modified seed producer, which is why people could easily buy heirloom seeds if they did not want to buy Monsanto products.  Now that they are trying to infiltrate the heirloom market, even though the seeds are still organic, people have to take more caution when trying to purchase non-Monsanto products.  This is becoming more difficult because right now there are over sixty heirloom companies that are either owned by Monsanto or are affiliated with them in another way.  This number is becoming larger due to Monsanto’s constant acquisitions of smaller companies to build their empire.  

 Recently Monsanto has been using a special type of vertical integration, control of every step of production in their product, in their corporate model.  They have been buying companies that have a direct connection with the production of their products, but they have also bought companies that could possibly help their products in the future, like their recent purchase of the Climate Company.  This company compiles hundreds of terabytes of weather data every day to help farmers predict storms and other natural disasters, and since Monsanto now owns them, they can easily use this information to take more advantage of their customers.  If Monsanto continues to make purchases like this it will strengthen their control on not only the seed industry, but on agriculture as a whole.    

Monsanto also monopolizes the seed distribution industry by having a strict patent on their genetically modified seeds.  The patent states that farmers who initially buy the seeds are not allowed to save and reuse seeds for the next year, instead they are required to buy new seeds every year.  This comes at a great cost to farmers because they used to be able to harvest the seeds from the current year and save them to plant next year without having to buy new seeds every year.  If Monsanto finds out that a farmer has violated this patent, they will go to extreme lengths and use whatever scare tactics they need to prevent it from happening again.  

Monsanto’s scare tactics used against farmers that range from using private investigators to using their copious amounts of lawyers to make farmers cave into their demands.  These private investigators will go around and collect different types of intel like photos or documents on who Monsanto believes has violated their patent.  In some cases, the private investigators come to farmers and threaten them to stop or Monsanto will put them through a lawsuit that the farmers cannot afford (Barlett).  This makes the farmer either go against Monsanto in court or settle to their demands, unfortunately most farmers have to choose the latter because they either do not have the time or money to go through with a lawsuit.  Due to Monsanto’s enormous size and the number of lawyers they have, it is rare that a lawsuit does not end in their favor, so even if a farmer goes to court against Monsanto, they will most likely lose and are forced to pay.  Some of these fines are very large and can easily bankrupt the farmers resulting in them shutting down their farms.  

Small, local farmers are the people most effected by the control of Monsanto.  If farmers want to use organic seeds they must pay more for the seeds themselves while having to pay for herbicide that will not harm the crop.  If farmers decide to purchase genetically modified seeds from another company, they are usually more expensive.  This is because the seeds are produced by a company that is smaller than Monsanto and does not have the resources to make seeds at a lower price.  This is most prevalent in Mexico where small, local farmers are trying to grow local corn, also known as maize.  It is a large part of their culture and cuisine, but as Monsanto has moved in, it has become much harder for these local farmers not to give into the GM seeds since local maize is much more expensive to grow than Monsanto seeds.   

The main problems with monopolies is that they can raise their price as much as they like because they own the whole market, and this becomes a problem for consumers because they must buy the product since there is nobody to compete against the monopoly.  Another main problem stems from the monopolies eventually being broken up.  Whenever a monopoly is broken up into different companies, it takes time and a great deal of resources to figure out how the company should be separated.  Therefore, the monopoly should be stopped before it becomes too large.  Although these are some major points against monopolies, some people believe that the government should not interfere and let businesses do whatever they would like.  

The United States economy is based on the idea of a free market, which means that the government as little to no control over businesses and what they do.  Some people believe that if the government restricts monopolies from buying out smaller companies and becoming larger, some of our freedoms are being taken away from us.  Another argument is that if only one company produced a product, they could spend less on marketing and advertisement.  This extra profit could be used on research and development to make their product better.  Finally, if only a single company produced all of one product, not as many resources would be used up and they could be allocated somewhere else.  

The arguments that are for monopolies are very theoretical, and have not been seen to occur with companies that are the size of a monopoly.  As seen with Standard Oil Company, the profits that they made did not go into research, otherwise they went into buying out smaller companies or into Rockefeller’s pockets.  If the United States has a completely free market, every different sector of the market would have its own monopoly, and consumers would not have a choice on who they bought products from.  If companies had extra revenue that they did not need to use on advertising and marketing, it would most likely not go to research.  Otherwise, it would be allocated towards higher salaries and other unnecessary things.

Monsanto fits into the majority of characteristics that defines a corporation as a monopoly.  If they continue their unorthodox business practices of buying out smaller companies and using scare tactics against farmers to maximize profits, then there has to be a point where the government steps in and breaks up the company into smaller sectors or businesses. The first step to this would be for the government to see them as a larger company than they see today. It is important not only to look at Monsanto itself but also the companies they own and have control over. If the government does not eventually see their mistake, Monsanto might become the largest monopoly in the world, maybe even larger than Standard Oil ever was.  
