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TheStreet Open House

Bayer Battles New Insecticide Research Affecting 20% of Sales

NEW YORK (TheStreet) -- The main ingredients in a wide array of agricultural and consumer insecticides produced by Bayer Group  (BAYRY) and Syngenta (SYT) have long been suspected of contributing to the collapse of honey bee populations. While the companies deny their products are the cause, new studies suggested widespread use of those insecticides could be having a much broader impact on untargeted insect and bird populations.

The debate is reshaping public policy around the world on insecticides to a degree not seen since DDT was banned and, as a result, threatens about 20% of Bayer's revenue. 

The most recent study, the results of which were published in the journal Nature, was based in the Netherlands and found that areas where the active ingredient imidacloprid was evident in higher concentrations in the surface water showed a correlating annual decline in the local population of bird species:

At imidacloprid concentrations of more than 20 nanograms per litre, bird populations tended to decline by 3.5 per cent on average annually. Additional analyses revealed that this spatial pattern of decline appeared only after the introduction of imidacloprid to the Netherlands, in the mid-1990s. . . .

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Imidacloprid is one of class of chemicals known as neonicotonoids and is used in a variety of products, including insecticides and herbicides.

Our results suggest that the impact of neonicotinoids on the natural environment is even more substantial than has recently been reported and is reminiscent of the effects of persistent insecticides in the past. Future legislation should take into account the potential cascading effects of neonicotinoids on ecosystems.

Bayer CropScience, a unit of Germany-based Bayer, originated the use of neonicotinoids, including imidacloprid, as insecticides, developing them in labs in the late 1980s and marketing them beginning in 1991. The technology began to take off in the 2000s. The unit's products now are almost entirely focused on crop protection based on neonicotinoid treatments and the unit's sales provided 8.8 billion euros ($11.9 billion) or 22% of Bayer Group's total revenue for fiscal 2013.

By Bayer's estimate, over 90% of corn seed used in the U.S. is treated with neonicotinoids. Most of that is distributed by Monsanto (MON).



Bayer CropScience took immediate issue with the Nature article in a rebuttal posted on its Web site. The company said the article "does not demonstrate that there is a causal link between the use of neonicotinoids and the development of bird populations in Europe. Neonicotinoids have gone through an extensive risk assessment which has shown that they are safe to the environment when used responsibly according to the label instructions."

In an interview with TheStreet, David Fischer, a scientist with Bayer CropSciences in North Carolina, dismissed the study.

"You can have a lot of correlations that don't necessarily imply a cause and effect relationship," he said. "You can correlate the number of babies in Europe with the number of storks on rooftops."

The Netherlands study noted that its scientists do not know the exact mechanism behind bird declines they associate with the concentrations of imidacloprid, but theorize that the toxins in insects are affecting the food supply of the birds. The study's lead author made that point in an email exchange with TheStreet.

"This could be food shortages (owing to high levels of imidacloprid in the surface water) possibly affecting breeding performance, possibly local recruitment, possibly mortality and so forth," Caspar Hallman, a Ph.D. candidate at Radboud University in the Netherlands, said. "Some bird species could be eating contaminated insects too, and for some of the species even coated seeds. We simply can't say at the moment."

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