The Department of Justice (DOJ) has filed suit against John Deere and Monsanto to stop Deere’s acquisition of Monsanto’s Precision Planting affiliated company. Much has been written in the ag press and non-ag media about this, but I thought it would be helpful to take a closer look at the DOJ’s allegations in its complaint, writes Todd Janzen in a recent post on his popular Ag Law Blog.
At the center of the DOJ’s complaint are two high-speed planting technologies: Precision Planting’s “SpeedTube” and John Deere’s “ExactEmerge.” Both technologies move seed from planter hoppers into the furrow in a fast, controlled manner. Traditional planters rely on gravity or air to move the seed, which works, but accuracy suffers as speed increases. SpeedTube and ExactEmerge allow farmers to plant at up to 10 mph, approximately double traditional planting speeds.
Deere has 44% of the high speed planting market; Precision Planting has 42%. Two other manufactures make up the rest of the market (Kinze 12%; Horsch 2%).
The DOJ argues that if Deere is allowed to acquire Precision Planting, it would have 86% of the market, an almost complete “monopoly.”
Head on over to Janzen’s Ag Law Blog for the full rundown on the Department of Justice lawsuit against the Deere-Precision Planting proposed merger.