By Tom Polansek and Karl Plume
May 6 (Reuters) - Across the U.S. Farm Belt, top grain
handlers have banned genetically modified crops that are not
approved in all major overseas markets, shaking up a decades-old
system that used the world's biggest exporting country as a
launchpad for new seeds from companies like Monsanto (NYSE:MON) Co MON.N .
Bold yellow signs from global trader Bunge Ltd BG.N are
posted at U.S. grain elevators barring 19 varieties of GMO corn
and soybeans that lack approval in important markets.
CHS Inc CHSCP.O , the country's largest farm cooperative,
wants companies to keep seeds with new biotech traits off the
market until they have full approval from major foreign buyers,
Gary Anderson, a senior vice president for CHS, told Reuters.
"I think that would be the safest thing for the supply
chain," he said. CHS implemented a policy last year under which
it will not sell seeds or buy grain that contains traits lacking
approvals needed for export.
The U.S. farm sector is trying to avoid a repeat of the
turmoil that occurred in 2013 and 2014, when China turned away
boatloads of U.S. corn containing a Syngenta AG SYNN.S trait
called Viptera that it had not approved. Viptera corn was
engineered to control insects.
Cargill Inc CARG.UL and Archer Daniels Midland Co ADM.N
each said the rejections cost them millions of dollars, and both
companies have sued Syngenta for damages. ADM is refusing GMO
crops that lack global approval. Cargill did not respond to
requests for comment.
The United States is the biggest producer of GMO crops and
has long been at the forefront of technology aiming to protect
crops against insects or allow them to resist herbicides.
That innovation is now seen as a risk to trade because it is
hard to segregate crops containing unapproved traits from the
billions of identical-looking bushels exported every year.
Soren Schroder, chief executive officer for Bunge, said the
practice of launching GMO seeds without full approval is "very
risky."
"It's an uncomfortable position for the industry when there
are traits out there that haven't had major market approval," he
said in an interview.
The latest crop being banned is Monsanto's Roundup Ready 2
Xtend soybean, whose seeds are genetically engineered to resist
the herbicides glyphosate and dicamba. It is being sold for the
first time in the United States and Canada this year despite
lacking clearance from the European Union, an important export
market for North American soybeans.
Monsanto said it expects EU approval soon. It initially
projected farmers would plant the seed on 3 million acres in the
United States, roughly 4 percent of overall plantings, and
420,000 acres in Canada.
Plantings have already begun in North America, and Monsanto
spokeswoman Trish Jordan said that each passing week without EU
authorization lowers the forecast for acreage in Canada.
The company is allowing growers to switch to another variety
and has not yet shipped Xtend seeds to farmers who have ordered
it in Canada. Monsanto has not publicly lowered its U.S.
forecast.
ADM, Bunge and CHS have said they will not accept Xtend
soybeans until the trait is fully approved by major markets.
Bunge also declined to accept Viptera corn before China cleared
it in December 2014.
The company's list of banned traits on its yellow posters
contains products from Monsanto, Syngenta, Dow AgroSciences,
Stine Seeds, DuPont (NYSE:DD) Pioneer and Bayer, many of which are not
commercially available to farmers yet.
CHS has its own list of restricted traits that includes
products from Monsanto, Syngenta and DuPont Pioneer.
Seed companies, including Syngenta and Dow, are addressing
industry concerns by selling biotech products under programs
that restrict where growers can deliver their harvests to keep
crops out of unapproved markets.
Farmers also produce crops containing biotech traits from
Monsanto and DuPont Pioneer under contracts with end users that
designate approved locations where they can be delivered.
However, such approaches are not fool-proof methods of
protecting the supply chain, Anderson said.
Stine Seed and Bayer said they have policies against selling
seed traits that lack approvals in major export markets.
Bayer this week seized on concerns about Monsanto's launch
of Xtend soybeans to promote its own brand, LibertyLink.
"Soybeans, once considered such a simple crop to grow and
market, is becoming more complicated," Bayer said. It called the
situation faced by growers "downright confusing."
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