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TITLE:  Japan's StarLink corn find could hurt US sales
SOURCE: Reuters
DATE:   Dec 31, 2002

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Japan's StarLink corn find could hurt US sales

TOKYO - U.S. corn sales to Japan, the world's biggest importer of the 
grain, could suffer after traces of the banned StarLink biotech variety 
were found in a cargo from the United States last week, a major Japanese 
grain importer said yesterday.

A previous discovery of StarLink about two years ago prompted Tokyo to cut 
purchases of U.S. corn sharply, sending importers scrambling to find other 
supply sources.

"We still can't know, but the possibility that things could become the same 
as two years ago is high," a senior source at the trading house told 
Reuters.

StarLink genetically modified corn was detected in a U.S. corn shipment 
bound for Tokyo's food supply in a vessel docked at Nagoya harbour last 
Thursday, renewing fears that major trading partners may once again turn 
their backs on U.S. crops.

The return of StarLink corn comes as the United States tries to convince 
reluctant trading partners that genetically modified crops are safe for 
consumers.

Japan's Agriculture Ministry said on Friday that trace amounts of StarLink 
had been detected.

It said the fate of the corn itself remained undecided but that Japan would 
take steps to beef up its monitoring of U.S. corn imports. The Health 
Ministry issued a similar statement.

Late in 2000, tests by a Japanese consumer group revealed traces of 
StarLink in domestic food and animal feed imports from the United States, 
leading to a big drop in Japanese buying of U.S. corn until a new testing 
protocol could be signed.

At that time, there were some increases in corn imports from China, 
Argentina, Brazil and South Africa in order to replace some of the U.S. 
corn imports.

The Japanese trade source said the worry could be finding an alternative 
source to Japan's massive U.S. corn imports, given that no one supplier can 
replace the 16 million tonnes a year Japan imports for both animal feed and 
human consumption.

The United States is the dominant supplier, representing more than 90 
percent of Japan's total corn imports.

Crops in South America will not be available until March or April next 
year, so some Japanese importers might seek corn from China to replace 
their needs from the United States.

"Whether we could locate an alternative source at this time is a concern," 
the source added.

Japanese commodities markets are closed until January 6 for the New Year's 
holiday.

U.S. exporters said the vessel on which the StarLink corn was found, The 
North King, was chartered by Japanese trading house Mitsui. Mitsui 
officials in Tokyo were unavailable for comment.

The United States is the world's largest producer of crops that are 
genetically modified to make them resistant to pests, or to withstand 
herbicides used to kill nearby weeds.

The return of StarLink corn could renew a widespread international backlash 
against U.S. grain exports as it did when it was first discovered in the 
United States two years ago.

U.S. corn purchases from Japan have only started to return to normal this 
year, while South Korean food processors have continued to shun U.S. corn 
for food use.



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