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EU rules risk creating soybean shortage
September 29 , 2008
BRUSSELS, Belgium - Europe's unease about genetically modified crops is threatening to create continent-wide shortages of soybeans, a crucial source of protein in the diet of Europe's livestock.
The European Union's strict regulations on genetically modified crops could prevent the import of millions of metric tons of new biotech soybeans likely to be planted in the U.S., Argentina and Brazil, the world's main soybean growers.
EU livestock farmers might not be able to get enough soybean for feed in the coming years, because exporters won't ship to Europe for fear that their cargos could contain unapproved biotech soybeans in the normal course of production and shipping. A similar obstacle exists for many corn imports, but, unlike soybeans, the EU can grow plenty of corn within its borders.
Farmers across the world already have been hit hard by rising fuel and feed prices. In Europe, a shortage-driven rise in soybean prices would likely spill over into meat prices, particularly of pork and chicken, prompting steep declines in their consumption and production.
The European Commission, the EU's executive arm, is debating how to respond, with one possibility being permitting trace amounts of unapproved biotech crops in imports. "We need to make sure we can source sufficient quantities of soy and proteins from outside Europe," said Michael Mann, the commission's agriculture spokesman.
An analysis published in 2007 by the commission found that under a "worst-case scenario" -- an interruption of soybean imports from the U.S., Brazil and Argentina -- European pork production would fall 34.7% in 2010 and poultry production would fall 43.9%.
Argentina and Brazil have in the past been careful only to allow planting of biotech strains approved by the EU for import. But China's emergence as a major soybean importer may reduce the EU's sway over the growers, the commission's report said.
The commission's options are limited by Europeans' deep suspicion of genetically modified crops. Almost 60% of Europeans oppose allowing genetically modified, or GM, crops into the food supply, according to a poll released in March by Eurobarometer, the commission's polling office.
The EU is accordingly one of the world's hardest places to grow or import biotech crops. The approvals process usually takes three years or more, compared with average 16 to 18 months in the U.S., say officials from the biotech industry.
Those long approval times have already blocked U.S. corn growers from exporting to Europe, because the U.S. has approved biotech varieties that aren't approved in the EU. Europe has managed without U.S. corn because the continent can grow much of its own.
But it probably won't be able to do the same with soy. The EU imports nearly 40 million metric tons of soy annually, or three quarters of its total soy consumption. Soybeans account for 55% of Europe's protein-rich animal feed, according to GMO Compass, a Web site sponsored in part by the commission.
There is one variety of genetically modified soybean planted widely -- Roundup Ready 1 developed by Monsanto Co. -- which has been approved for import to the EU. But two new varieties, one each from Monsanto and Bayer AG, will be planted in the next year in the U.S. Brazil and Argentina are expected to begin planting later.
These crops appear likely to get import clearance into Europe, as the EU took several steps this month toward approval. But it's not clear whether the EU will approve Monsanto's Roundup Ready 2 for import by the fall of 2009, when the soybean crop will be harvested from 400,000-800,000 hectares in the U.S.
With 22 other genetically modified soybeans under development by the industry, according to the American Soybean Association, a trade group, uncertainty over whether a new soybean variety will get EU approval in time for the fall harvest could become an annual ritual.
One solution being considered by the commission would be to set a tolerance level for the presence of unapproved GM materials in food and feed imports. U.S. exporters could then ship approved soybeans to Europe without worrying that tiny amounts of unapproved GM soybeans in the shipment would block the entire cargo from being delivered. However, the proposal, which the commission said it wanted ready before its summer vacation that started this week, is still under discussion. It is also unclear if EU law allows the commission to set the tolerance high enough to make those imports practical.
If the issue isn't resolved, more farmers will go out of business, farm groups say, and the EU will increasingly be forced to import its meat -- where animals will be fed with GM crops anyway.
Copyright © 2008 Dow Jones & Company, Inc.
Source: The Wall Street Journal |
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