The Role of GE Seeds and Patent Systems

GE seed patents are now a central mechanism by which to gain control and ownership of genetic material of seeds writ large.  IPR rules, particularly following the 1985 Diamond v. Chakrabarty decision, have expedited the adoption of GE seeds and simultaneously, GE seed technology broadens the scope of seed patenting.  These schemes codify a weak and misleading definition of “invention,” allowing companies to “isolate” a part of nature, or slightly modify an existing process or “product,” and then patent it, as if it were novel.  Yet the purported innovation is based on centuries of collective community knowledge and traditional seed breeding.

Seed Industry Consolidation and Control

The current patent and intellectual property (IP) regime for seeds has been a major factor in seed industry consolidation, as evidenced below:

  • Ten multinational corporations hold approximately two-thirds – 65 percent – of global commercial seed for major crops.[1]
  • Monsanto controls 60 percent of the global corn and soybean seed markets.[2]
  • More than 90 percent of U.S. soybean acreage and 80 percent of corn acreage is planted with Monsanto’s patented traits.[3]
  • At present, four agrichemical companies own a full 43 percent of the world’s commercial seed supply.[4]
  • The number of small, independent seed companies has rapidly declined: In 1996, there were 300 independent seed companies in the U.S.; by 2009, there were fewer than 100.[5]

Rising Cost of Seeds

Such intensive corporate concentration of seed ownership has resulted in increasing market power and a corresponding substantial increase in seed prices:

  • From 1995-2011, years covering the introduction of GM soy, soybean seed costs per acre have risen a dramatic 325 percent – from $13.32 to $55.55;[6] by 2011, GE soybean seed was approximately 47 percent costlier than non-GE soy.[7]
  • The cost of GE cotton seed rose approximately $100/acre since the introduction of GE cotton, cutting farmers’ profits per acre by about $200.[8]
  • Both conventional and GE corn seed prices have also risen dramatically.  From 1996-2010, conventional seed prices rose from $26.65 to $58.13 per acre.  In 2010, the cost of GE corn seed per acre was roughly double that of conventional seed, averaging $108.50 and reaching as high as $120 per acre.[9]
  • In addition to the cost of seeds, a “trait fee” is charged—this fee has also precipitously risen from $4.5 per bag of soybean seed in 1996 to an estimated $17.50 by 2008.[10]

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[1] Kristina Hubbard, Farmer to Farmer Campaign on Genetic Eng’g, Nat’l Family Farm Coal., Out of Hand: Farmers Face the Consequences of a Consolidated Seed Industry 13, 16 (2009),  available at http://farmertofarmercampaign.com/Out%20of%20Hand.FullReport.pdf.

[2] Monsanto Co.,  Supplemental Toolkit for Investors 3 (Feb. 2010) (see line item: “Cash Used for Acquisitions”), http://www.monsanto.com/investors/documents/supplemental_toolkit.pdf;  Kerry Preete, Monsanto Co.,  Goldman Sachs Agricultural Biotech Forum 2011 14 (Feb. 9, 2011) (showing $7

billion in cumulative R&D from 2001 to 2010, which is $700 million/year), http://www.monsanto.com/investors/Documents/2011/Goldman_Sachs_Presentation.pdf.  

[3] Kristina Hubbard, Farmer to Farmer Campaign on Genetic Eng’g, Nat’l Family Farm Coal., Out of Hand: Farmers Face the Consequences of a Consolidated Seed Industry p17-18 (2009), available at http://farmertofarmercampaign.com/Out%20of%20Hand.FullReport.pdf.

[4] Kristina Hubbard, Farmer to Farmer Campaign on Genetic Eng’g, Nat’l Family Farm Coal., Out of Hand: Farmers Face the Consequences of a Consolidated Seed Industry p4 (2009), available at http://farmertofarmercampaign.com/Out%20of%20Hand.FullReport.pdf.

[5] Matthew Wilde, “Independent seed companies a dying breed,” WCF Courier, August 22, 2012, http://wcfcourier.com/business/local/article_7cef1ffc-b0bb-56a8-8d83-faf894bf76ad.html

[6] Econ. Research Serv., U.S. Dep’t of Agric., Commodity Costs and Returns, (last updated Nov. 15, 2012), http://www.ers.usda.gov/data-products/commodity-costs-andreturns.aspx (under “Data Set” scroll down to “Historical Costs and Returns: Soybeans”; select “”U.S.: 1975-96” (reporting that seed costs per acre were $13.32 in 1995)) (under “Data Set” scroll down to “Recent Costs and Returns: Soybeans”’; select “U.S.: 1997-2001, 2002-05, 2006-11”; select “US 2006-2011” tab (reporting that seed costs per acre were $55.55 in 2011)).

[7] Benbrook: Impacts of genetically engineered crops on pesticide use in the U.S. – the first sixteen years. Environmental Sciences Europe 2012 24:24 p5.

[8] Charles Benbrook, The Organic Ctr.,  The Magnitude and Impacts of the Biotech and Organic Seed Price Premium p3 (Dec. 2009), http://www.organic-center.org/reportfiles/Seeds_Final_11-30-09.pdf

[9] Benbrook: Impacts of genetically engineered crops on pesticide use in the U.S. – the first sixteen years. Environmental Sciences Europe 2012 24:24, p5.

[10] Kristina Hubbard, Farmer to Farmer Campaign on Genetic Eng’g, Nat’l Family Farm Coal., Out of Hand: Farmers Face the Consequences of a Consolidated Seed Industry 13, 16 (2009),  available at http://farmertofarmercampaign.com/Out%20of%20Hand.FullReport.pdf.

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