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7-Business: India sees record cotton output for second year

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

TITLE:  India sees record cotton output for second year
SOURCE: Reuters, Interview by Naveen Thukral
DATE:   5 Sep 2005

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INTERVIEW - India sees record cotton output for second year

NEW DELHI (Reuters) - India, the world's third largest cotton producer,
is expected to produce a record crop for the second straight year but
lack of rains in some growing areas could spoil the party, a top trade
official said on Monday.

The country's cotton production in the year to September 2006 is likely
to reach 23.5 million bales, up from 21.5 million bales a year ago
because of more area under cultivation, good weather and extensive use of
transgenic seeds.

"The crop looks excellent in most growing areas," Rakesh Rathi, president
of the Northern India Cotton Association, told Reuters in an interview.

"The central and western parts of the country need one last spell of
rains before harvesting next month."

Production could take a hit in Gujarat, Maharashtra and Madhya Pradesh
which have not received much rainfall for the past almost a month, said Rathi.

"But if we get one good spell by mid-September, then there will be no

The land under cotton has increased to around 8.3 million hectares from
8.2 million hectares lat year, according to the farm ministry.

India's cotton crop, prone to pest attacks like bollworm, has remained
largely free of pests this year because of more use of pest-resistant
genetically modified cotton.

In 2002, India allowed transgenic cotton that contains a gene from
Bacillus thuringiensis, a bacterium species. When infested by bollworm,
it causes lethal paralysis in the digestive tract.

Traders said the area under transgenic cotton has jumped three-fold to
1.5 million hectares this year.

"The use of pesticides has been less because of genetically modified
cotton and excellent weather conditions," Rathi said.

But forecasts of a higher cotton output and a big opening stock have
already depressed cotton prices in India. The long staple shankar variety
is selling at around 16,550 rupees a candy of 356 kg each compared with
20,500 rupees at this time last year.

In Punjab the medium staple J-34 is quoted around 15,700 rupees a candy,
lower than 16,700 rupees last year.

India this year has an opening stock of 5.7 million bales compared with
an average of 3.5 to 4 million bales.

"Cotton prices are near the government's support price level, now it will
depend on buying by the government's procurement agencies," said Rathi,
who is based in the northwestern cotton-growing region of Abohar.

He said prices could fall further if the government was not able to
handle the increased production.

Record cotton production has brightened the prospects of cotton exports
from India. Rathi said the country could sell around 2 million bales
during the crop year, up from around 1.2 million bales a year ago.

"Indian cotton prices are competitive and acceptability of our cotton is
increasing rapidly in the world markets," he said.

India mainly sells cotton to China, Bangladesh and the Middle East.

                                 PART II
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TITLE:  Sales of Monsanto's Genetically Modified Cotton Seeds Rise 131
        Percent in India
SOURCE: Associated Press, by S. Srinivasan
DATE:   7 Sep 2005

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Sales of Monsanto's Genetically Modified Cotton Seeds Rise 131 Percent in

BANGALORE, India (AP) -- U.S. agribusiness giant Monsanto Co. said
Wednesday that it had sold more than 3 million packets of its genetically
modified cotton seeds so far this year in India, a 131 percent jump over
last year's sales.

Monsanto touted the sales growth of its BT cotton seeds as a vindication
of its effort to market genetically altered crops in India, where it has
faced protests by environmental activists, delays in getting government
approval for some of its products and even bans on varieties of seeds.

"Our numbers show the willingness of Indian farmers to adopt modern
technology," Ranjana Smetacek, the Indian spokeswoman for Monsanto, based
in St. Louis, Missouri, told The Associated Press.

BT stands for bacillus thuringiensis, a bacterium whose gene is injected
into cotton seeds to give them resistance against boll worms, a major
concern in India. BT cotton is the only transgenic crop allowed in the

Each of the 3 million 450-gram (16-ounce) packets of seeds sold by
Monsanto and its Indian partners covers an acre (0.4 hectare) of
cultivation, meaning that some 3 million acres (1.2 million hectares)
should have been planted so far this year.

India's cotton industry plants all types of cotton seeds on more than 22
million acres (7.9 million hectares) a year. The country's cotton sowing
season runs from June to early September.

Monsanto sold 1.3 million packets in 2004, 230,000 packets in 2003, and
72,000 in 2002, the year India opened its doors to transgenic crops.

Critics say the adverse effects of genetically modified seeds have not
been studied adequately and that the seeds are environmentally hazardous
and could contaminate the genes of native varieties.

Environmental activists on Wednesday repeated oft-heard concerns that
farmers also do not benefit from genetically modified seeds.

"When we interview farmers, they say the costs of growing BT cotton far
outweighs any economic benefit," said M. Thangamma, a Greenpeace
activist. "So, one has to question the data coming out of Monsanto."

The price of each packet of BT cotton seeds is about US$40, or four times
that of conventional seeds, but she said yields increase by only about 3

Monsanto, on its part, claims BT cotton farmers get anywhere between 30
percent to 60 percent more profits compared to those sowing conventional

Monsanto has licensed the BT cotton technology to 19 Indian partners,
which have introduced 20 varieties and have submitted another 100 for
approval by regulators.

Rasi Seeds, one of Monsanto's Indian partners, said this year's sales
improved because Indian farmers were less resistant to using genetically
altered seeds.

"Our seeds are now highly accepted," said M. Ramaswamy, the company's
managing director. "All that protest is going away and nothing can stop
farmers from buying the seeds."

Monsanto's Indian subsidiary:


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