Bayer AG, a major agricultural science company, is contemplating a significant shift in its product line by considering an exit from the glyphosate business. Glyphosate, most famously known as the active ingredient in Monsanto’s Roundup, has been a cornerstone of modern farming for over five decades. However, the chemical is now facing a dual challenge: increasing weed resistance and substantial legal battles over its alleged health impacts.
Bayer inherited the glyphosate business through its massive $63 billion acquisition of agrochemical giant Monsanto. Since then, the company has faced over 60,000 outstanding legal claims in the US alone, with individuals alleging that glyphosate caused them to develop cancer, particularly non-Hodgkin lymphoma. These legal battles have already cost Bayer over $10 billion, with a recent Georgia jury awarding almost $2.1 billion in a case involving a former Roundup user.
This mounting legal pressure has significantly impacted Bayer’s stock, which has seen a decline of over 70% since the Monsanto acquisition. CEO Bill Anderson has stated that the company will either find a resolution to these issues or exit the glyphosate business. While acknowledging glyphosate’s importance for farmers in producing food globally, Anderson pointed out that the chemical lost its patent protection 25 years ago and is no longer highly profitable.
Despite the legal and weed resistance issues, exiting the glyphosate market would create a substantial gap in Bayer’s finances. Glyphosate accounted for approximately 12% of its crop division’s revenue last year. Furthermore, many of Bayer’s genetically modified seeds for crops like corn and soybeans are designed to be used with glyphosate, creating a complex interdependency.
The issue of weed resistance is also growing. For years, farmers have relied on glyphosate-tolerant “Roundup Ready” seeds, which allow them to spray glyphosate to kill weeds without harming their crops. This system has simplified weed management and promoted no-till farming practices, which reduce soil erosion. However, weeds have evolved, and glyphosate-resistant varieties are now a significant problem for farmers in the US and other parts of the world.
This evolving resistance has led some farmers to revert to older herbicides or employ manual weeding methods. Bayer has responded by developing seeds with resistance to multiple herbicides, such as its new “Vyconic” soybean, which is tolerant to five different herbicides. However, experts like Professor Emeritus David Mortensen question this approach, suggesting that weeds will eventually develop resistance to any heavily used chemical and advocating for more diverse weed management strategies, including crop rotation.
Concerns about human health risks associated with glyphosate have also intensified. Studies, including one by a World Health Organization unit in 2015, have classified glyphosate as “probably carcinogenic to humans.” While Bayer maintains that glyphosate is safe, citing numerous studies, opponents point to research that raises doubts. Bayer has removed glyphosate from its “lawn and garden” versions of Roundup in the US and is actively defending its position in court, often referencing the U.S. Environmental Protection Agency’s (EPA) stance that glyphosate is unlikely to be a human carcinogen when used as directed.
In response to the litigation, Bayer has set aside nearly $18 billion for legal costs. Representatives for Bayer have even reportedly considered placing the Monsanto division into bankruptcy protection as part of settlement talks. The company is exploring various strategies to manage and potentially end the litigation, including exploring alternative herbicides and restructuring options.
The potential discontinuation of glyphosate production by Bayer could lead to a significant reduction in global supply, potentially increasing reliance on manufacturers in China. This raises questions about long-term food security, especially as climate change poses increasing risks to crops.
Finding a suitable replacement for glyphosate is also a challenge. Developing new herbicides is a costly and time-consuming process, with regulatory requirements for safety evidence increasing significantly over the years. Bayer is researching new chemicals like Icafolin, but these are often intended to complement, rather than replace, glyphosate.
The agricultural industry is exploring a range of solutions, including integrated weed management, biological herbicides, advanced crop rotation, and precision agriculture technologies like drones and robots. The future of farming may involve a more diverse toolkit, moving away from a singular reliance on chemical solutions like glyphosate.