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The Green Guide

Monsanto Fails Trying to Sell Europe on Bioengineered Food
May 11, 1999
By SCOTT KILMAN and HELENE COOPER
Staff Reporters of THE WALL STREET JOURNAL

LONDON -- Monsanto Co. has done something quite
remarkable for a U.S. company in
Europe. It has gone from obscurity to infamy in
just a few years.

In March, during a debate about the World Trade
Organization in the House of Commons, MP
Norman Baker called the U.S. crop-biotechnology
company "Public Enemy No. 1." Prince
Charles recently vowed that Monsanto's biotech
food would never pass his royal lips. Former
Beatle Paul McCartney publicly spurned the company
after it was reported that his late wife
Linda's line of vegetarian sausages contained
soybeans grown from Monsanto's seeds.

Activists have torn up Monsanto test plots in the
United Kingdom. British newspapers call
Monsanto the "Frankenstein food giant" and the
"biotech bully boy" so routinely that some
Monsanto employees jokingly refer to their
employer as "MonSatan."

"Many people here really hate Monsanto," says
Isabelle Gineste, a member of the
Townswomen's Guilds, a civic group. "The rest of
us are just scared."

Designer Beans

Monsanto's sin? It genetically modifies
agricultural seeds, including those that produce many of
the protein-rich soybeans Britain imports from
America to make a host of food products.

American farmers love Monsanto's seeds; the seeds
make soybean, corn and cotton crops easier
to grow. And American consumers have barely noticed.

But a public-relations campaign by Monsanto to win
over Europeans has backfired -- stoking
environmental opposition, riling media
commentators and leading many U.K. food retailers, in
response, to bar genetically modified food. The
British units of Unilever NV and Nestle SA
have pledged not to use any genetically modified
foods in their products in the future.
Politicians from Dublin to Duesseldorf are talking
about a moratorium on such crops, a bleak
prospect for American farmers who already face
depressed prices.

Indeed, the fallout is beginning to be felt in the
U.S. The European Union already requires
labels on food containing those genetically
modified crops whose import it has approved. And
it is so reluctant to approve the import of more
that U.S. farmers have begun avoiding several
new seeds. The U.S. grain industry has nearly
stopped shipping corn to Europe for fear that
European laboratory tests might detect kernels
from genetically modified crops not yet cleared
by the EU. What was a $200 million annual market
for U.S. corn farmers is now all but closed.

The B List

"This year, we've got the three B's with Europe,"
says U.S. Trade Representative Charlene
Barshefsky. "Bananas, beef and biotechnology."
Already this year, her office has levied or
threatened sanctions on the Europeans over bananas
and beef. But those markets are small
compared with agricultural biotechnology. The
European markets for genetically modified
crops and seed is potentially worth several
billion dollars a year. Says one official at the WTO
in Geneva, where a trade war over the issue would
be fought if one broke out: "Biotech will
make bananas look like peanuts."

U.S. farm groups are itching for a fight, but it's
one the Clinton administration dreads, despite
having the rules on its side. The European Union
doesn't have any scientific basis for singling
out food containing genetically modified crops;
regulators on both sides of the Atlantic say
such crops are safe to eat. But European public
attitudes are a different issue. "It's not going to
matter whether we win" at the WTO, says a Clinton
administration official. "These people aren't
going to touch anything that says Monsanto anyway."

One reason Monsanto feels so much heat is simply
that it is the furthest along in a science that
inevitably raises questions about man's control
over nature. "We are the bow of a technology
that is making a lot of waves," says Philip
Angell, director of corporate communications.

Soy Bomb

But another reason is Monsanto's brash and open
approach. It has ignored the go-slow advice
of European companies that work in agricultural
biotechnology, such as Britain's Zeneca Group
PLC and Switzerland's Novartis AG. "Monsanto has
just made things a lot worse," gripes
Michael P. Pragnell, head of the agrochemicals
division at Zeneca.

Skepticism about genetically modified food is
common not just in Europe, but also in Japan,
Australia and New Zealand, all of which are
considering requiring that labels identify such
food. In India, farm activists, upset about work
on a gene that would stop them from keeping
some of their harvest for seed, have destroyed
Monsanto cotton fields.

Foes argue that whatever regulators say, such food
hasn't been proved safe. They also worry
that a gene such as one that conveys resistance to
herbicide could escape into the wild and make
other species resistant, or that gene splicing
might transfer not just the desired trait but, for
instance, another that triggers allergies.

And some are concerned with broader, cultural
issues, from America's growing economic power
to the impact of technology on Britain's beloved
countryside. "There is a feeling that interfering
with nature on this scale is unethical and
immoral," says Sandra Bell, director of a group called
the Freeze Alliance.

In America, such concerns are much fainter. Foods
ranging from TV dinners to french fries
regularly contain genetically modified produce.
Some potatoes, for instance, contain a gene --
added by Monsanto -- that repels insects. U.S.
regulators haven't seen a need for such alteration
to be mentioned on food labels, since the
technology has a clean bill of health. Partly for that
reason, agricultural biotech hasn't caught on as a
hot issue in the U.S.

The biggest crop-biotech venture from St.
Louis-based Monsanto, which also produces drugs,
involves soybeans. The company has inserted a gene
into soybean seeds that enables the
resulting plants to tolerate a potent herbicide
called Roundup -- also sold by Monsanto. This
makes it cheaper and less labor-intensive for
soybean farmers to keep weeds out of their fields.
Roughly half of U.S. soybeans grown this year will
be from gene-modified seeds, sold by
Monsanto or by seed companies using its technology.

The EU cleared such soybeans -- indistinguishable
except by laboratory test from any other
soybeans -- for import in March 1996. The first
bushel hit the docks at Liverpool a few months
after.

Mad Cow

The timing was terrible. Britain was in full panic
mode over "mad-cow disease" after scientists
said beef from affected cattle was the likely
source of a fatal brain-wasting disease in some
Britons. The announcement crushed public
confidence in regulatory and scientific communities
that had long given assurances that the disease
ravaging British dairy herds wasn't a human
threat.

And, because mad-cow was thought to be spread by
the practice of using dead livestock as a
protein source for cattle, the whole issue caused
many to wonder about the sanity of modern
agricultural methods. "The mad-cow disease seems
to many people to be the result of not
observing the law of nature," says Daniel Vasella,
chairman of Novartis.

The credibility of environmental activists soared
in Britain because many had prophesied a
deadly link between mad-cow disease and people.
Now they took one look at genetically
modified food and went on a campaign. This time,
they had a ready audience: Britain's
freewheeling press. British newspapers had largely
ignored the environmentalists before; they
weren't going to do so again.

The fallout spread across the Continent, which had
dined on British beef. Antibiotech attitudes
hardened in Germany and France. Austria and
Luxembourg banned genetically modified crops,
flouting EU rules.

To counter mad-cow madness, Monsanto tapped Tom
McDermott from its public-relations
staff and a senior vice president, Steven
Engelberg. They decided Monsanto would nip the
antibiotech movement in the bud. Mr. McDermott,
feeling that "we weren't getting a fair shake
in the British media," lobbied his bosses for a
campaign aimed directly at consumers.

Chief Executive Robert Shapiro endorsed the idea
and invited his European counterparts to join
in campaigns in Britain and France. Zeneca and
Novartis wanted no part of it.
Corporate-backed issue campaigns aren't the
European way, and Europeans tend to be a lot
more mistrustful of big companies than Americans.
"In the States, P.R. works," says Julie
Shepherd, director of the Consumers Association, a
watchdog group. "Over here, it's seen as a
species of corporate lying."

Mr. Shapiro decided to go it alone. He had
successfully ignored conventional marketing
wisdom before. Early in his career, he figured out
how to brand what was thought to be
unbrandable, a food ingredient -- NutraSweet.

Number to Call

Monsanto picked ad agency Bartle Bogle Hegarty, a
London shop known for sexy ads for
Dockers pants. Bartle's plan: Show Monsanto wasn't
afraid of debate.

The ads had their debut in British Sunday
newspapers last June. "Food Biotechnology is a
matter of opinions," said one. "Monsanto believes
you should hear all of them." Included were
phone numbers of critics, including Greenpeace and
Friends of the Earth.

One ad, invoking hungry Third World children,
said: "While we'd never claim to have solved
world hunger at a stroke, biotechnology provides
one means to feed the world more
effectively."

The ads irked some commentators, who slammed
Monsanto for exploiting the plight of starving
children. And they angered environmentalists, who
said publishing their phone numbers was a
cynical attempt to stage-manage debate.

They did raise Monsanto's profile; polls showed
that twice as many Britons knew its name as
Novartis's. But the surveys also showed that
people were mainly identifying Monsanto, not
Novartis or Zeneca, with genetically engineered food.

That wasn't good. Before the U.K. ad campaign, 44%
of British consumers surveyed for
Monsanto said they had negative feelings about
genetically modified food. By the time the
campaign was over last September, that number had
swelled to 51%. Says Neal Verlander, a
Friends of the Earth activist: "Monsanto has
helped us enormously with their blundering."

The ad agency didn't return calls seeking comment.
Monsanto denies its initiative made things
worse in Britain but concedes it achieved less
than hoped. "There hadn't been much controversy
in the United States. Our problem is we looked at
it too much through a U.S. lens," says Mr.
Engelberg, the vice president. Communications
Director Mr. Angell says: "Maybe we weren't
aggressive enough... . When you fight a forest
fire, sometimes you have to light another fire."

Monsanto is happier with the results of a
simultaneous ad campaign in France, where the press
wasn't as hostile or the public as suspicious. Its
surveys show the French campaign resonated
with high-income readers and opinion leaders;
those who saw the ads were almost twice as
likely to say genetically engineered food was
acceptable as those who didn't see them. But
among all the French, the number who said they
wouldn't buy food containing genetically
modified ingredients rose to 55% after the
campaign from 51% before.

Meet the Press

Monsanto executives also decided to take on the
news media directly. They met with reporters
and editors from London's Guardian, which had run
a map of Monsanto test plots. Whether as
a result or not, three plots later were destroyed.

The meeting went badly. "They came in here
thumping the table and accusing us of being bad
journalists," says John Vidal, the Guardian's
environmental editor. "We just coalesced against
them." Making things worse, Monsanto filed a
complaint against the Guardian with Britain's
Press Complaints Board, and lost.

Some in the media seemed ready to pounce. A
biochemist at Scotland's prestigious Rowett
Research Institute told a TV show that his lab
rats had their immune systems damaged by
eating genetically modified potatoes, which some
reporters seized on as evidence that genetic
engineering might make a plant toxic. But the
institute repudiated his conclusions after
reviewing his work. The potatoes, which were used
for research purposes only, weren't cleared
for human consumption. The government-supported
institute dropped the scientist, Arpad
Pusztai.

He promptly became a martyr in part of the British
press. "I Would Blow Whistle Again Says
Professor," said a headline in the Express.

Dr. Pusztai defends his research but says he
doesn't know what in the potatoes harmed his rats
or whether it had anything to do with gene
splicing. "What I'm saying is we need to look at it
more," he says.

Wrongful Mowing

Monsanto couldn't seem to get a break. In
February, it was fined $28,000 in a magistrate's court
in the tiny village of Caistor for what the media
called "safety lapses" at a test plot. The reality
was slightly more benign: A subcontractor
mistakenly mowed down plants that were part of a
barrier separating the plot.

That was enough to engender a carnival scene
outside Caistor's court. About 100 activists and
reporters descended on the hamlet. Among them was
"Frankenstein," a costumed
environmentalist also seen outside groceries
warning that "Frankenstein Food" was sold inside.

His warnings worked. Over the past two months,
many of Britain's major food retailers have
pledged to stay free of genetically modified
foods. One, J. Sainsbury, says it got 12,000 phone
calls in a single month from worried shoppers.

Surprisingly, one Monsanto foe does find something
to appreciate about the American
company: its candor. "Zeneca and Novartis have
just kept quiet -- that's the European way,"
says Mr. Vidal, the Guardian environmental editor.

"I far prefer the Monsanto way," he says. "Their
up-frontness is a rather wonderful thing. The
fact that their vision might be warped is another
thing, but it creates a public debate, which we
need."