Jacob Bunge reported in today’s Wall Street Journal that, “U.S. opposition to the largest acquisition by a Chinese company is growing, with a top farm-state senator saying the $43 billion takeover of seed giant Syngenta AG could pose risks to the security of America’s food supply.
“Sen. Charles Grassley (R., Iowa) launched a public broadside against China National Chemical Corp.’s planned deal, saying that the government must ensure that ‘we’re not permitting the sale of too much of our food industry, especially when government-controlled entities like ChemChina are the buyers.’
“He said in an interview Wednesday that a bipartisan group of senators would seek a formal role for the U.S. Department of Agriculture as the Treasury-led Committee on Foreign Investment in the U.S., or CFIUS, carries out a national security review of the proposed ChemChina-Syngenta deal. Lawmakers want food security and safety implications analyzed, said Sen. Grassley said.”
Mr. Bunge explained that, “The lawmaker’s comments raise a new threat to a deal that investors don’t yet regard as a sure thing. The USDA has already expressed concerns over the deal’s potential impact on the sector.
“ChemChina struck a deal to buy Syngenta in February, extending a string of deal making among global giants in the $100 billion market for crop seeds and sprays. Agricultural companies are pursuing deals as they grapple with a three-year slide in major crop prices that has hit farmers’ pocketbooks and forced seed makers to cut thousands of jobs.”
The Journal article added that, “U.S. farm groups and agricultural companies also have complained that China’s process for reviewing and approving agricultural products like genetically modified seeds is out of step with other major countries, leading to sometimes lengthy delays for high-tech seeds and trade disruptions.
“U.S. Agriculture Secretary Thomas Vilsack said in February that the U.S. agricultural industry has grappled with ‘inconsistency’ and ‘lack of synchronization’ when it comes to securing China’s approval to import new biotech crops in China, one of the world’s top buyers of agricultural commodities.”
