'Over 1,000 trucks carrying soybeans from other states on their way to the port and the state's massive crushing industry have backed up at Parana's borders because the state is testing cargoes and turning back trucks that test positive for GM soy.'
---Brazil battle over biotech soy threatens top export
Reuters, 10.27.03, 12:50 PM ET
by Reese Ewinghttp://www.forbes.com/markets/newswire/2003/10/27/rtr1123905.html
SAO PAULO, Brazil, (Reuters) - Brazil's uncertainty on how to regulate genetically modified soy could put at risk a vibrant source of growth and trade revenues for the recession-beset economy, analysts said on Monday.
As the federal government bickers over a long-awaited draft bill on biotechnology, the populist anti-GM governor of No. 2 soybean growing state Parana, Roberto Requiao, has effectively shut off Brazil's main soy port by declaring Parana GM-free.
"The potential for loss under Parana's policy is enormous and the port may be greatly hurt," said grains analyst Flavio Franca Jr. of Safras e Mercado. "Most importantly though, this is going to be a problem for the entire country."
Soy is Brazil's leading farm export, expected to bring in over 10 percent of total trade revenues this year.
This is the second crop season that President Luiz Inacio Lula da Silva's government has legalized transgenic soybeans by decree without producing any legislation or appointing regulatory bodies on the controversial technology.
Although the federal government has legalized GM soy in Brazil, it has left open the possibility of states declaring GM-free zones giving rise to the dilemma in Parana.
While the government acknowledged the illegal GM soy trade that the previous administration had turned a blind eye to, cabinet infighting over how stringently to regulate GM foods has kept the government from proposing legislation.
In favor of GM in Lula's cabinet is Agriculture Minister Roberto Rodrigues, representing Brazil's increasingly powerful agribusiness lobby that includes U.S. biotech seed giant Monsanto Co. .
On the other side is the fiery Environment Minister Marina Silva, who carries the banner for many of Lula's supporters such as Greenpeace and consumer activists, who feel biotechnology is the Trojan Horse of multinationals.
Brazil is set to be the world's No. 1 soybean exporter this year for the first time, displacing the United States. But if Gov. Requiao succeeds in turning his state GM-free, which many doubt is possible, Brazil's title could be short lived.
"It will be exceedingly difficult to achieve," said grains analyst Carlos Cogo, of Agromercados in Rio Grande do Sul. "The soy that has been running through Brazil's silos, trucks, trains, processing plants -- GM and conventional soy has all been mixed together for years."
Brazil temporarily legalized GM soy by decree only this year, although producers in Rio Grande do Sul, Parana and Mato Grosso do Sul previously ignored the ban, smuggling GM seeds from Argentina where Monsanto's Roundup Ready soy is widely planted.
Parana legislators passed a bill, which Requiao should sign into law on Monday, that will turn it and Brazil's main grain port Paranagua into a GM-free zone until 2006. Recently, state agriculture agents began stopping soy trucks at the border.
Over 1,000 trucks carrying soybeans from other states on their way to the port and the state's massive crushing industry have backed up at Parana's borders because the state is testing cargoes and turning back trucks that test positive for GM soy.
And this is the interharvest period. During the March-May harvest and several months after, hundreds of thousands of soy trucks carrying the bulk of Brazil's estimated 60 million tonne crop will be headed for Parana and its port.
Gov. Requiao's populist discourse is bound to foment tensions over GM soy in Brazil. He has argued that Parana would receive a 20 percent premium for its soy if it were GM-free, although many in the soy sector disagree.
"This is a grave error," said Franca. "Time and money will be lost. The rest of the country's ports simply cannot handle the extra shipments if soy flows from Rio Grande do Sul and center-west are diverted from Paranagua."
Copyright 2003, Reuters News Service