Monsanto Company (MON), Syngenta AG (ADR) (SYT): The Two Sides of the GMO Debate

Therefore, chemical companies believe that they are providing invaluable products to the world. To protect their products’ profitability, they are taking all necessary measures to ensure that their technologies are not copied – a stance that has been supported by software companies, who often face the same copyright problems as Monsanto. Although Monsanto’s cases against individual farmers over the past decade have been widely publicized due to the “David vs. Goliath” nature of the conflicts, a vast majority of farmers have profited from their deals with Monsanto.

Protecting the product

Moreover, the majority of Monsanto Company (NYSE:MON)’s litigation has been focused on its industry peers, such as E I Du Pont De Nemours And Co (NYSE:DD) and Syngenta AG (ADR) (NYSE:SYT), and not individuals. In 2009, DuPont created the Optimum GAP soybean seed, which was engineered to withstand glyphosate – the key ingredient in Monsanto’s Roundup herbicide. Although DuPont never commercially sold these seeds, Monsanto sued DuPont for patent violations. DuPont and Monsanto eventually came to a licensing agreement, in which the former would pay the latter $1.75 billion over the next decade to sell its glyphosate-resistant soybeans.

Back in 2008, E I Du Pont De Nemours And Co (NYSE:DD) reached a similar agreement with Syngenta AG (ADR) (NYSE:SYT), in which the two companies cross-licensed their herbicide-resistant technologies. Other companies, such as The Dow Chemical Company (NYSE:DOW) and Novartis AG (ADR) (NYSE:NVS), also pay licensing fees to sell Monsanto’s genetically modified seeds.

Lastly, GMO crops are not all designed for maximum profitability and efficiency. Monsanto’sgolden rice was engineered to be loaded with Vitamin A to address malnourishment and vitamin A deficiency in developing countries, which can cause blindness. Proponents claim that golden rice is proof that GMO products can have lasting positive impacts on a growing global population.

The Foolish Bottom Line

Like any controversial topic, the GMO debate is not a simple black-and-white matter. Rather, the whole issue is steeped in gray. Here are some questions to ponder before making a snap judgment about the industry.

If we really didn’t have companies such as Monsanto Company (NYSE:MON), how much would we be willing to pay for corn, soybean and cotton products as their prices skyrocket? How many farmers would be wiped out when another drought hits and our government discovers that it has run out of funds to subsidize the farming industry? How will we address the problem of unsustainable population growth?

Leo Sun has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

The article The Two Sides of the GMO Debate originally appeared on Fool.com.

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