GENET archive


2-Plants: Argentine GE crop tangle

                                  PART I
-------------------------------- GENET-news -------------------------------

TITLE:  Argentine soybean tangle
SOURCE: Barron's, by Taos Turner, via Syngenta Media Clipping
        posted by Checkbiotech, Switzerland
DATE:   22 Aug 2005

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Argentine soybean tangle

Monsanto, the leading producer of genetically modified plant seed, is
having trouble in tango territory.

The St. Louis-based company has spent the past decade watching Argentine
farmers embrace one of its premier products, Roundup Ready soybeans.

The seeds are herbicide-resistant, so by using them farmers can easily
kill weeds to boost yields and profit margins. Argentine soybean output
has tripled to 39 million metric tons since 1996, when Monsanto started
selling Roundup Ready in Argentina and the U.S. Argentina is now the
world's No. 3 soybean producer and exporter and the No. 2 modified-crop

Ironically, however, revenue from Roundup Ready has evaporated. Around
95% of Argentine soybeans are Roundup Ready, but each year fewer farmers
pay Monsanto royalties. The company says that it received royalties on
just 18% of the Roundup Ready crop planted this season in Argentina,
costing it millions of dollars in lost revenue.

In the U.S., where Roundup Ready accounts for about 91% of soybeans,
Monsanto gets paid via sales at more than 200 seed companies. "These
companies pay Monsanto a royalty when growers purchase their seed," says
Monsanto spokeswoman Lori Fisher. "Hundreds of thousands of farmers have
signed agreements since 1996 to use Monsanto's technology, and growers
understand that they may only benefit from the technology for the season
for which they are purchasing their seed."

Argentina lacks such accords. Moreover, because the seeds reproduce each
season, farmers can replant them without paying the royalties. U.S. law
prohibits this; Argentina's doesn't.

Meanwhile, Monsanto has been unable to patent Roundup Ready in Argentina,
as it has elsewhere. So, early last year, Monsanto stopped selling
Roundup Ready in Argentina. That spurred heated debate among farmers and
public officials and led to multiparty talks to solve the problem.

However, negotiations achieved little, so Monsanto began playing
hardball. This year, it told Argentine exporters it would seek a $15 per-
ton fee on soybean shipments to compensate for unpaid royalties. The fee
would be collected on exports to countries recognizing Monsanto's patent.

This infuriated farmers, who assumed they would end up paying the fee.
Farm groups called Monsanto a greedy monopoly, and Argentina's
Agriculture Secretary Miguel Campos, slammed the multinational for its
"thug-like attitude." He said Monsanto was betraying a nation that has
long been a "strategic ally of biotechnology."

Last month, Monsanto dropped a bombshell by confirming it had filed
lawsuits in Denmark and Holland over soybean shipments to those
countries. Campos reacted angrily and called Monsanto "a national
embarrassment. "Argentina exported $1.6 billion of soybean products to
the European Union in 2004.

The Economy Ministry, which oversees the Agriculture Secretariat, is also
concerned. It collects some $2 billion annually from soybean export taxes
and doesn't want trouble. And with congressional elections in October,
government officials don't want to alienate farmers, who are already
upset about high export taxes.

Campos says Argentina will participate as a third party in the lawsuits
and that it will prevail in court. However, another Argentine official
familiar with the issue says Monsanto has the upper hand. In the end,
E.U. buyers will ask Argentine exporters to bear additional import costs,
and these will be passed onto farmers. Monsanto, the official says, will
eventually get its royalties. It's unclear how much Monsanto might
collect. If recent agreements between Monsanto and farmers in Brazil and
Paraguay are any guide, Argentines could end up paying around $3-to-$5 a ton.

However, the problem could still be resolved without E.U. courts, which
could take years to settle the issue. "We expect to get an agreement,"
says Federico Ovejero, a spokesman for Monsanto Argentina. Meanwhile,
investors, other biotech firms, and farmers in neighbouring Brazil and
Paraguay, where Monsanto has been negotiating similar deals, are watching
to see what happens.

Crude oil prices rose Friday after a volatile week marked by Mideast
terror fears and a production outage in Andean producer Ecuador. New York
Mercantile Exchange September crude oil rallied $2.08, to $65.35 a barrel.

                                  PART II
-------------------------------- GENET-news -------------------------------

TITLE:  Argentina OKs new GMO corn developed by Syngenta
SOURCE: Reuters
DATE:   22 Aug 2005

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Argentina OKs new GMO corn developed by Syngenta

BUENOS AIRES, Argentina, Aug 22 (Reuters) - Argentina, the world's No.2
corn exporter, approved on Monday a new genetically modified (GMO) corn
made by Swiss firm Syngenta, in a move to promote more crop rotation.

The variety, known as GA21, is resistant to the herbicide glyphosate,
just like Roundup Ready corn developed by rival biotech giant Monsanto.

The government forecasts that farmers will seed between 3.0 million and
3.1 million hectares with corn this season, down from 3.32 million
hectares in the 2004/05 crop year, mainly because GMO soybeans are
cheaper and easier to grow.

But the government wants to encourage farmers to plant corn, which is
crucial for replenishing soil nutrients.

"If through biotechnology we can achieve costs that are similar to soy's
costs, this will generate sustainable crop rotations," Agriculture
Secretary Miguel Campos told a news conference.

Because Argentina already approved Roundup Ready corn last year, the
impact of this green light is not expected to be great.

But Campos said Argentine farmers choose among more than 148 variations
of Roundup Ready soybeans, which revolutionized the farm sector after
their introduction in 1996, indicating that there is a market for fine-
tuned crop options.

Still pending is approval of a Monsanto corn variety that combines Bt and
Roundup Ready genes to resist both insects and glyphosate, which analysts
expect to have greater impact since Bt corn is already seeded on about 60
percent of corn lands.

A conflict between the government and Monsanto over GMO soybean royalties
has cast doubt about when the government would approve this new variety.

Argentina is the world's No.2 producer of GMO crops behind the United
States, with ten biotech crop varieties approved for seeding: one for
soy, two for cotton and now seven for corn, according to biotech lobby

(Additional reporting by Karina Grazina)


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