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Biotech Seed Makers Try to Defuse Trade Uncertainties
From the Wall Street Journal of Mon, 15 Dec 2014 19:16:59 EST
Some seed companies have placed strict limitations on new products since China started rejecting U.S. corn. A corn farm in Washington, Ill.
Some seed companies have placed strict limitations on new products since China started rejecting U.S. corn. A corn farm in Washington, Ill. Fred Zwicky/Journal Star/Associated Press

CHICAGO—The U.S. agricultural industry is crafting a framework for launching new biotech seeds in an attempt to avoid the types of trade disruptions blamed for hundreds of millions of dollars in losses over the past year.

Groups representing seed companies, grain traders and farmers aim to agree next year on a set of practices that could help U.S. farmers plant new genetically modified crop varieties while steering those harvests away from countries that have yet to approve the crops for imports, officials said.

The discussions are progressing as U.S. corn exports to China dropped sharply this year, after Chinese regulators in late 2013 began turning away U.S. corn shipments found to contain a biotech corn strain not yet approved in China.

Grain companies including Cargill Inc. and Archer Daniels Midland Co. have sued Syngenta AG , the Swiss seed company that developed that corn, over what the companies say are tens of millions of dollars in lost sales. U.S. farmers also have filed about 180 separate lawsuits blaming Syngenta for lower corn prices stemming from the rejected shipments. Syngenta officials have said the cases have no merit, and that the company has been transparent about the approval process for the corn strain.

“This is a global trading world,” said Frank Terhorst, global head of seeds for Bayer AG ’s agricultural division, which sells genetically engineered seeds. “The more aligned we are as an industry, the better it is.”

The industry discussions, convened under a group called the U.S. Biotech Crops Alliance, aim to produce voluntary guidelines about how seed companies could communicate plans to sell new products, determining which export markets may need to be avoided, and how to manage grain as it moves through elevators, trains and ports. Syngenta has participated in the discussions through its seed trade group membership, according to a spokesman for the company.

“Our goal is to maintain market access to exports and technology,” said Nathan Fields, director of biotechnology at the National Corn Growers Association, which represents farmers and is involved in the discussions. He said the group’s goal is to complete guidelines by April for companies and farm groups to review.

China’s rapidly expanding poultry and livestock operations helped make the country the fastest-growing customer for U.S. corn in recent years, purchasing $976 million worth of the grain in 2013. But following the rejected exports, sales of U.S. corn to China have dropped 87% by weight for the year through October, according to the U.S. Department of Agriculture.

Syngenta said Friday it expects China to approve the company’s Viptera corn strain, which has spurred the rejections, in “the near future.”

The episode has stirred debate within the agricultural industry over how to manage new seeds as scrutiny deepens around biotech crops, which are genetically modified to make plants resistant to weed-killing sprays and destructive bugs.

For seed makers, waiting for China’s blessing can extend the period of eight to 10 years it typically takes to develop and win approval for new products, even after other markets like the U.S. have approved them.

Some seed companies have placed strict limitations around the launch of new products since China started rejecting U.S. corn, while others have opted not to release new seeds at all before securing approval from Chinese regulators.

Dow Chemical Co. in November said it would offer a new line of genetically engineered corn for sale to U.S. farmers next year, but only if they agreed to feed corn grown from the seeds to animals housed on the same farm, and sell none to grain companies.

After some grain traders placed restrictions on purchases of another new biotech corn strain launched by Syngenta this year, Syngenta announced in February that grain company Gavilon LLC had agreed to buy that corn from farmers.

“We looked at a lot of different options,” said Joe Vertin, who oversees the new corn products at Dow. He said Dow’s plan would stand for 2015 but the company had yet to decide on any further restrictions around marketing the corn after that.

Bayer, which has had one biotech soybean awaiting China’s approval for seven years, won't release such products before the country gives its approval, said Mr. Terhorst, due to the country’s stature as a major buyer of U.S. soybeans.

U.S. agricultural companies remain hopeful that China will more quickly approve biotech crops submitted for review there. In November, President Barack Obama raised the issue during a visit to Beijing, during which he met with China President Xi Jinping .

“We look to China to approve biotechnology advances that are critical to feeding a growing planet on the same timeline as other countries,” Mr. Obama said.

Write to Jacob Bunge at

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