Canada’s Competition Bureau (the Canadian version of the Fair Trade Commission), is reportedly investigating bad behavior from certain agricultural giants including Bayer, Corteva, and Cargill.
The allegations were originally raised by a company called Farmers Business Network, a disruptive force in the North American agricultural market. Farmers Business was founded six years ago by veterans of Google and venture capital to provide data and analytics to help farmers drive efficiencies in their operations. The company has raised over $300 million in venture funding and hasn’t been sheepish about their growth plans.
Lately, Farmers Business has been focused on breaking into the seed and pesticide e-commerce business. The company made its first foray into the Canadian market with the acquisition of a Saskatchewan-based distributor. And that’s when things allegedly started to get unpleasant.
Farmers Business claims that large seed and pesticide companies have effectively locked them out of the Canadian market and are refusing to do business on their platform.
What’s the Problem, eh?
The reality is no individual company can be told to sell their products through a specific channel. But when multiple companies act in concert to lock a new entrant out of the market, even the friendly Canadians will throw an anti-competitive challenge flag.
The agricultural companies in question have good reason to be skeptical of Farmers Business, which wants to build the Amazon of farming. Transparency, liquidity, and diversity of product offering are the enemy of fat profit margins for suppliers. Just ask publishing companies how they feel about Amazon’s entrance into the book market 25 years ago.