Modified crops' market impact not clear yet

Updated: 2014-12-24 12:08

By Jack Freifelder in New York(China Daily USA)

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Experts take wait-and-see view to China's OK of 3 new GM strains

China's recent approval of three genetically modified (GM) strains of crops should liven up the crop export market.

But the impact on the country's bilateral agricultural trade with the United States is not expected to be great in the short term, said a director with the US Soybean Export Council.

"The soybean industry in the United States is very reliant on export markets, and this past year, the US exported about 60 percent of its total soybean production," Paul Burke, regional director of North Asia for the soybean council, told China Daily on Tuesday.

"China is a very large market within that demand structure, but certainly not the only export market," Burke said. "So the industry in the US is very cautious about commercializing new soybean events before they're approved in major export markets. That's why so much attention was being paid to these approvals."

On Dec 18, the US Commerce Department announced that Chinese officials made commitments to promote the increased imports of one variety of GM corn and two strains of modified soybeans.

The varieties of biotech soybeans were developed by Bayer AG and DuPont Co, US Agriculture Secretary Tom Vilsack said on Dec 17, while the corn strain, MIR 162, is a product from Syngenta AG.

Kent Beadle, a manager with the Russell Consulting Group, an Iowa-based agricultural consulting firm, said soybean trade between the US and China "remains very robust".

"There have been few, if any, issues regarding the GMO varieties of soybeans that we sell to China," Beadle wrote in a Tuesday email to China Daily. "The volume of soybeans taken by China has been larger this year than many in the trade anticipated.

"This further indicates the soybean trade between the two countries remains solid and poised for continued growth," he said, so "soybean trade continues to be 'business as usual.'"

The US is the world's largest exporter of soybeans, according to data from the US Department of Agriculture, and Brazil is second. Other significant global players in the soybean production market include Argentina and China.

China, the main destination for US-produced soybeans, is the largest international market for US food and agricultural products.

The country imports nearly 20 percent of all US farm exports, a total that reached a record $26.7 billion in fiscal 2013. Soybean exports from the US to China reached $13.8 billion last year.

Burke said having access to the same technology allows farmers to increase their production and the fertility of their soil, all while minimizing the use of agricultural chemicals.

"The US only supplies China with about 37 percent of all the soybeans that it imports, so China actually buys more soybeans from South America than it does from North America," he said.

On Monday, Chinese lawmakers began considering a proposed revision to the country's Food Safety Law that includes mandatory labeling of all goods containing GMOs.

Late last year, China began rejecting corn shipments from the US after it found traces of the MIR162 biotech variety. Bloomberg News reported on Dec 18 that China has turned away more than 1.2 million tons of US corn and corn products, according to estimates from Sylvia Shi, an analyst at Shanghai JC Intelligence.

Beadle said the latest series of approvals from Chinese officials, including GMO corn traits, is helpful for the overall dialogue around the topic of GMO varieties in China.

Burke said: "The farmers in South America are very similar to the farmers in North America, and they have the same objectives. They're not going to commercialize an event when it's not approved in a major export market."

Burke also said farmers in North and South America want a biotech approval process in China that is "open, transparent and operates on a regular basis".

"US soybean farmers and Chinese consumers are going to be the long-term beneficiaries of these kinds of developments," he said. "China is not going to be importing a lot more soybeans just because of these two types, but what it allows is for the US soybean farmers to continue to be very competitive."