WASHINGTON, Oct. 29, 2014-- In the wake of controversy surrounding China’s rejection of Syngenta’s genetically modified corn trait, Syngenta can strengthen grain supply management in North America “in a way it’s never been done before,” Chuck Lee, the head of corn for Syngenta, said at the company’s media summit in Washington on Tuesday.
When Syngenta launched a new corn trait this year called Duracade, which controls corn rootworm, one of the most prolific pests for corn growers, it also started a new program called Right to Grow to help reduce the risk of rejected exports. As part of the program, Syngenta is partnering with Gavilon, a supply chain manager to connect Duracade growers with grain traders that agree to connect with appropriate end-users.
Gavilon has 2,500 farmers growing Duracade and more than 1,200 locations in the U.S. accepting it, according to Greg Konsor, the company’s vice president of commercial management, who speculated that it could take two years before China will once again accept U.S. corn. “Are we willing to wait that long for new technology for our growers?”
China ignited the controversy last November when it began rejecting cargoes of U.S. corn after detecting an unapproved biotechnology trait developed by Syngenta, Agrisure Viptera (MIR 162), which resists several corn insect pests.
In September, Cargill filed a lawsuit seeking damages from Syngenta for commercializing its corn seed before the product obtained import approval from China. China’s actions virtually halted U.S. corn trade with the world’s most populous nation. A study by the National Grain and Feed Association (NGFA) estimated that U.S. exporters and farmers lost almost $3 billion because of the uncertain trade environment, Cargill noted. Several class action lawsuits from individual farmers followed the one filed by Cargill.
Syngenta says the lawsuits are without merit. “We did everything correctly in the launch of Viptera,” Lee said, noting that the trait was launched with full approval in the United States and gained import approvals from other key export markets. “Growers can be upset, but in most cases they can understand that.”
Referring to the Right to Grow program, Lee said Syngenta decided that the right to plant an approved product is vital for the company and for U.S. growers who want the latest technology. “This issue is bigger than Viptera and bigger than China,” he said. “We believe in the end that we have a safe technology and we should have the right to market it.”
He noted that China had accepted U.S. corn since 2011, when the Syngenta launched the Agrisure Viptera.
“We think Viptera was a trait in the wrong place at the wrong time,” Lee said. “[China] had a glut of corn and the trait was not approved for import. It was only in 2013--when China had a record production -- did we see China reject Agrisure Viptera. We think this is a trade issue.”
Lee further emphasized his belief that China’s action against the Viptera trait is arbitrary, noting that the country is likely accepting imports of the same trait from Latin America. Viptera is approved for cultivation in Brazil and Argentina. Lee said at least 3 percent of the corn crop in those countries includes the Viptera trait and “we know China is accepting exports from Argentina.”
The Right to Grow program has the support and endorsement of the National Corn Growers Association. Having the grower group’s support is very important for Syngenta, Lee said, adding that “in the face of some pretty severe pressure, [NCGA] said, ‘we need this technology; we understand without it we will be uncompetitive.’”
NCGA’s Ken Colombini noted in an email that any farmer plaintiffs in the lawsuit against Syngenta are acting on their own behalf “and are in no way representative of the position of state or national corn growers associations.”
Lee said Syngenta views the challenge posed by China as a key learning experience which ultimately will strengthen the company. “Supply chain management has never been done at this type of scale,” Lee said, but once the process through the Right to Grow program is perfected, end-users will have the product they want and U.S. grain traders and growers will know that it isn’t going to unapproved markets.
Gavilon has “a different attitude about what the future of the supply chain looks like,” Lee said, and end-users are increasingly seeking differentiated products, making the supply chain and trade more complicated.
During the U.S. Grains Council Export Exchange in Seattle last week, Howard Minigh, president and CEO of CropLife International, said no biotechnology events have been approved in China since June of last year, and the country has a backlog of about 23 products pending import approval dating back to 2010.
These delays are “largely driven by political concerns rather than science and safety,” he said.
He said coalitions in Canada, the United States, Argentina and Brazil are sending messages to China regarding grain trade approvals. “We’re encouraging President Obama to meet with his counterpart in China next month to see if we can get movement on liberalizing this regulatory policy,” he said.