Monsanto, Brazilian Unions Reach Agreement
29 July 2013 After fighting over royalty fees since December 2010, Monsanto said it has reached an agreement with the various Brazilian rural unions affiliated with FAMATO (the Federation of Agriculture and Livestock of the State of Mato Grosso).
The recent agreement, reached July 23, aims to improve agriculture in Brazil through collaboration, states that Monsanto will work on improving its biotechnology for soybeans, sign a recognition of royalty rights for farmers regarding agricultural technology, draw up a seamless price model and provide a bonus for growers that sign the Intacta licensing agreement. In return, the Brazilian associations will drop the lawsuit.
FAMATO said, “These actions are part of a conscious effort of agricultural leaders and Monsanto to work together, aiming to bring innovation and a more positive direction for Brazilian agriculture.”
The associations filed the suit against Monsanto over the royalty fees it charged farmers for using their Roundup Ready products. They had found Monsanto’s soy seed prices to be too high and their demands for a second collection of royalties unreasonable. The explanation for this unfairness is that the second royalty is often collected when the seeds have been contaminated and are no longer of use to the grower. Monsanto subsequently appealed the lawsuit.
Roughly 5 million farmers have been a part of this lawsuit, claiming that they are owed an estimated $7.7 billion. Monsanto has drawn up contracts earlier in the lawsuit, but the associations refused to sign.
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