Brazil's Planting-Time Soy Quandary (13/10/2004)
TELL ALL YOUR FRIENDS - PLEASE CIRCULATE WIDELY
"Even if the law [to allow GM soy] is approved, other hurdles appear to lie ahead, thanks in part to Roberto Requiao, governor of the leading agricultural state of Parana, a major producer and shipper of soybeans. He has ordered that the port of Paranagua, in his state, be closed to genetically modified crops, and has also threatened to close highways to trucks hauling them."
Planting-Time Soy Quandary for Brazil
By LARRY ROHTER
New York Times, October 13, 2004
RASÃªLIA, Oct. 11 - With the spring planting season just beginning in the Southern Hemisphere, Brazil, the world's leading exporter of soybeans, is in a quandary. The government has been unable to secure congressional approval for the planting of genetically modified seed stock, but farmers are ignoring the ban and sowing the seeds, many obtained illegally, anyway.
The messy situation promises to create additional uncertainty in the trading of soybeans, one of the most important and widely consumed commodities in markets around the world. After hitting a high of $10.55 a bushel in March, soybean prices have tumbled nearly a third as China abruptly cut back on its purchases.
The Brazilian Senate approved a Biotechnology Law last week that covers areas from genetically modified organisms to stem-cell research, but the modified legislation is still subject to approval by the lower house of Congress, where it is likely to face delays and additional debate. As a result, President Luiz Inacio Lula da Silva may be forced to issue a temporary decree that would apply only to this year's harvest, as he also had to do in 2003.
"The government is looking at the practical side of this issue, and wants the matter to be resolved in the Congress," Roberto Rodrigues, the minister of agriculture, said in an interview here on Monday. But, he added, "the subject is controversial enough that it has remained in Congress for a year without a decision."
Brazil is one of the last of the world's main agricultural producers not to have granted blanket permanent approval to the planting of genetically modified crops like soybeans, corn and cotton. But agricultural experts estimate that genetically modified seeds accounted for up to 20 percent of last year's harvest of just over 50 million metric tons of soybeans, though the official government estimate was only 8 percent.
But despite the holdups and considerable opposition, the question seems to be when, not if, the seeds will become legal.
"What needs to be made clear is that the government is going to give judicial guarantees to the planting of genetically modified soybeans, no matter what," Mr. Rodrigues said. "This is a political decision that has already been taken."
Monsanto Company is watching intently from the sidelines since it stands to be the principal beneficiary of any change in Brazilian policy. The company's Roundup Ready soybeans are widely planted in neighboring Argentina, where the cultivation of genetically modified crops is permitted.
The Monsanto soybeans contain a protein making them resistant to Roundup, a herbicide that is also manufactured and sold by Monsanto. Monsanto says the modified beans are safe for human consumption. Environmentalists and others, however, have expressed concern that long-term effects are not yet known, that there is no way to halt the spread of pollen from modified crops, and that planting of the seed would encourage the use of Roundup, which contains a chemical believed to be toxic to fish.
But in recent years the seeds have also been smuggled across the border and sowed clandestinely in Brazil, mainly in the three southern states bordering Argentina.
As a result, Monsanto says it has been deprived of millions of dollars in royalties. In addition, the company says it has been unable to monitor sales of its seeds here, as it does in other countries, and some farmers have ended up producing both the traditional and genetically modified varieties, which are sometimes harvested and marketed with no distinction between them.
"We are awaiting a definitive solution to the biotechnology issue in Brazil, so that growers will have clarity and the ability to choose the technology they want," said Lucio Pedro Mocsanyi, a Monsanto spokesman in SÃo Paulo. The company is already collecting royalties in Brazil's southernmost state, he added, and "we are studying ways in which we can expand that charge to other areas of Brazil this year."
The confusion here has also led to tensions between Brazil and some of its main customers. Some European countries either forbid or severely restrict the importation of genetically modified food products, and while China does not follow a similar policy, it does insist that genetically modified soy be clearly labeled.
"The legislation foresees this clearly," Mr. Rodrigues said of the bill awaiting approval. "There has to be a separation of one thing from the other so that buyers in or outside Brazil can be certain the product they are buying is genetically modified or not."
With legislators preoccupied with midterm municipal elections until the end of the month and several other pieces of legislation having priority on the official agenda, it is not clear when Congress will get around to voting on the biotechnology bill. In addition, the environmentalist caucus, opposed to genetically modified crops, and the evangelical caucus, which opposes stem-cell research, are threatening to vote together to delay or defeat the bill.
Even if the law is approved, other hurdles appear to lie ahead, thanks in part to Roberto Requiao, governor of the leading agricultural state of Parana, a major producer and shipper of soybeans. He has ordered that the port of Paranagua, in his state, be closed to genetically modified crops, and has also threatened to close highways to trucks hauling them.
"The only thing missing is for them to legalize marijuana," Mr. Requiao complained recently in criticizing the federal government's position. His defiance, should it continue, would probably lead to a long and complicated court test with important constitutional implications.
"There is a discussion going on as to whether a state can have a law that contravenes a federal law," Mr. Rodrigues acknowledged during the interview here. "But that is a judicial issue with diverse interpretations, and I don't want to get into that."