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Saturday, August 2, 2014
GMOs REJECTED IN CHINA COSTING AMERICAN FARMERS BILLIONS
When China Spurns GMO Corn Imports, American Farmers Lose Billions
A corn purchaser writes on his account in
northwest China in 2012. In November 2013, officials began rejecting
imports of U.S. corn when they detected traces of a new gene not yet
approved in China.
For a while there, China was the American farmer's best friend.
The world's most populous nation had so many pigs and chickens to feed,
it became one of the of U.S. corn and soybeans almost overnight.
China also developed a big appetite for another corn-derived animal feed called "dried distillers grains with solubles," or ,
a byproduct of ethanol production. China's appetites for the stuff
drove up global grain prices and filled Midwestern pockets with cash.
This year, though, the lovely relationship has gone sour, all because of biotechnology. A couple of years ago, American farmers began planting a of genetically engineered corn invented by the seed company .
This GMO contains a new version of a gene that protects the corn plant
from certain insects. Problem is, this new gene isn't yet approved in
China, and Chinese officials didn't appreciate it when traces of the
new, as-yet-unapproved GMOs started showing up in boatloads of American
The crackdown began in November 2013. China began
rejecting shiploads of corn when officials detected traces of the new
gene. By February of this year, U.S. exports of corn to China had
At the time, some American grain exporters said that there was
little to worry about. The Chinese move, they said, probably was
intended to slow down imports temporarily in order to make sure that
China's farmers got a decent price for their own corn harvest. As
evidence, they pointed to the fact that China continued to accept
imports of DDGS, which also contain traces of the unapproved gene. The
U.S. sent $1.6 billion worth of DDGS to China last year.
Well, last week, China expanded the ban to DDGS, shocking many traders. The price of DDGS plunged.
According to the ,
the Chinese ban on corn and corn products may end up costing American
farmers, ethanol producers and traders a total of about $3 billion.
director of Economics for the NGFA, who came up with that estimate,
says the ban actually is hurting the Chinese, too. "They replaced [the
U.S. corn] with more expensive grains," he says, such as barley from
Australia. But one group of American farmers is benefiting: China is
importing lots more .
In an interesting twist, American farm
groups seem unsure whom to blame. Some are angry at China. Others point
their finger at Syngenta.
A few days ago, the wrote a to
Secretary of Agriculture Tom Vilsack, urging his "immediate, direct, and
personal intervention" with Chinese officials "to halt this current
regulatory sabotage of the DDGS trade with China."
The NGFA and the , on the other hand, have on Syngenta to stop selling the offending corn varieties until those varieties can be sold in major export markets.
being a bad actor here," says Max Fisher of NGFA, referring to
Syngenta. "They're making $40 million" selling the new corn varieties,
"but it's costing U.S. farmers $1 billion."
Syngenta, for its part,
any blame for the debacle. "We want to get technology into the hands of
farmers as soon as possible," said the company's CEO, David Morgan, in a
released on Syngenta's website. "We can't expect growers to wait
indefinitely for access to technologies, based on what foreign
governments decide to do." According to Morgan, China has failed to make
a timely decision on the new gene, which goes by the name MIR 162. Even
if China approved MIR 162, however, the ban might remain. That's
because Syngenta began selling yet another new new type of GMO corn this
year, which also is not yet approved in China.