Bayer's Roundup Woes Deepen as Germany Bans Key Chemical
September 04 2019 - 11:45AM
Dow Jones News
By Ruth Bender
BERLIN -- Bayer AG's efforts to fend off thousands of lawsuits
against its Roundup herbicide were dealt a symbolic blow Wednesday
when Germany, the company's home country, said it would ban the
product's key ingredient.
The move is unlikely to directly impact the chemicals and
pharmaceuticals group's bottom line, because Germany is a
negligibly small market for Roundup. While the decision was
motivated by environmental considerations rather than glyphosate's
alleged potential to cause cancer, which is at the center of the
lawsuits, the optics of Roundup being banned in Bayer's backyard
are jarring amid the company's insistence that it is safe to
use.
After Bayer acquired Roundup inventor Monsanto Co. in 2018, the
German company was hit by lawsuits from 18,400 farmers, hobby
gardeners and others who said Roundup made them ill. The company is
appealing the verdicts and has pointed to the scores of markets
where glyphosate is licensed as evidence of its safety.
Nonetheless, the government of Germany, where Bayer was founded
and is headquartered, has approved a plan to gradually restrict the
use of glyphosate, the main ingredient in Roundup, and ban it
outright from the end of 2023, shortly after a Europe-wide license
for the chemical expires.
The head of Bayer's crop science business, which now includes
Monsanto, said the company disagreed with the move to a unilateral
ban.
"The ruling ignores decades of scientific judgment from
independent regulatory agencies around the world that glyphosate is
safe when used properly," Liam Condon said.
The ban would have very little impact on Bayer's sales, analysts
say. Bayer says Europe accounts for less than 10% of its total
glyphosate sales, which the company doesn't break out. The bulk of
glyphosate sales are generated in the U.S. and South America.
Bayer said pro forma crop science sales reached EUR19.3 billion
($21.2 billion) in 2018, assuming Monsanto had been part of the
business for the entire year and not just since June 7, 2018, when
the acquisition closed.
The planned ban highlights the growing resistance to glyphosate
in Europe, which could lead to European Union countries blocking
another bloc-wide license in late 2022 when they are due to vote on
a renewal.
In July, Austria became the first European country to impose a
ban on glyphosate. In France, a court banned a Roundup brand
earlier this year, while some mayors this summer moved to ban
glyphosate in their municipalities.
The topic has split the EU for years. In 2017, a new five
year-license was almost voted down until a last-minute nod from
Germany tipped the balance. The surprise decision, made by the
agriculture minister against the advice of the rest of the
government, sparked an uproar in the country.
Other countries outside of Europe have adopted total and partial
glyphosate bans in the past, such as Colombia and El Salvador. Sri
Lanka in 2015 was the first country to issue a national ban, but
later revoked it.
Before glyphosate is banned outright, Germany will push to
gradually reduce its use, first banning it in gardens and parks and
imposing stricter rules for its use in agriculture.
Write to Ruth Bender at Ruth.Bender@wsj.com
(END) Dow Jones Newswires
September 04, 2019 11:30 ET (15:30 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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