Consumer Pressure for GE Food Labels Threatens US Exports to Asia & Pacific Region

Headline: Transgenic food rules spark market upheaval in Asia
Wire Service: RTna (Reuters North America)
Date: Wed, Sep 1, 1999

By Michael Byrnes
SYDNEY, Sept 1 (Reuters) - New rules to govern genetically modified
organisms (GMO) in Asia's US$1,000 billion a year food market have begun to
threaten exports worth billions of dollars from the United States and
The spread of a now-global battle over the use of GMOs to Asia, the
biggest market in the world food chain, has been triggered by Japan, South
Korea, Australia and New Zealand all deciding to enact laws requiring
labelling of transgenic foods.
"The United States is concerned. It was concerned about Australian
labelling which recently went through," one insider close to negotiations
over the Australian code told Reuters.
With the United States alone exporting more than US$15 billion a year
worth of unprocessed agricultural products to Asia -- and much more in
processed food and beverage products -- blows are already being landed as
an Asian round of the global GMO prizefight gets underway.
U.S. authorities and officials have publicly protested recent
decisions by Japan and Korea to introduce labelling laws.
The U.S. Administration has also mounted a quiet but effective
lobbying campaign to curb labelling decisions by the Australia New Zealand
Food Authority (ANZFA), the insider said.
The Australian and New Zealand governments eventually decided on
August 4 to order mandatory labelling of food containing GMOs. But the U.S.
effort still paid off, he said.
"It (the code) could have gone a lot further."
With one-third of its corn and half of its soybeans and cotton
genetically modified, the United States' US$51.7 billion worth of
agricultural food exports each year is the biggest potential loser in the
global GMO fight.
All on the producer side of the GMO revolution say strict labelling
laws and transgenic crop controls may make it so difficult for exporters to
comply or penetrate markets that they may tip multi-billion dollar trade
balances against GMO foods.
"It could start to alter the trade picture," said Wendy Craik,
executive director of Australia's top farm lobby group, the National
Farmers' Federation.
But another scenario is also emerging.
This view sees a more practical, less combative Asia eventually
standing in quieter contrast with mayhem in the European GMO battle, where
militant purists have destroyed crops and threatened sabotage of
"Frankenstein food."
Even Australia's active consumer movement is not storming barricades
over GM foods, although it raises concerns about the right to know and
about untested effects of modified food.
"The public does not dismiss it out of hand but needs to feel it is
truly being consulted," said Carole Renouf, senior policy officer for the
Australian Consumer Association.
"I get the feeling that Japan is not as concerned about it (GMO foods)
as Europe," one Australian government official told Reuters.
It was quite probable that while Japanese consumers were pushing for
labelling laws, the country would not cut its own throat by restricting
imports of food products, he said. The eventual answer would be in the
implementation of labelling laws.
"I think they will come to some arrangements," he said.
So does Craik. "In about five years time the heat will have gone out
of this debate, then countries like Japan will just gradually start to take
it (GM food)," she said.
U.S. chemical giant Monsanto Co (MTC.N), one of the main producers of
genetically modified crops, has a similar view.
"We're pretty optimistic that given good labelling and good consumer
knowledge this whole thing will settle down pretty well," said Monsanto
Australia spokesman.
In widely-divergent patterns of regulation, non-regulation and
murkiness in Asian regulations on GMOs, North Asia's trail blazers Japan
and Korea are also the region's biggest customers for U.S. foods, the
world's most highly genetically engineered.
Between them the two Asian neighbours took US$11.3 billion worth of
U.S. agricultural products in calendar 1998, including US$3.6 billion of
corn, soy and cotton, the key GMO crops.
But China, Hong Kong and Southeast Asia as a whole, which together buy
US$3.6 billion worth of U.S. agricultural products, including US$1.1
billion worth of coarse grains, soy and cotton, are not rushing to label
and strictly control GM foods.
"In time to come, consumers may probably push the government to
implement some enforcement on labelling of the products," a Malaysian
official said. "The level of awareness of GM food by consumers is not as
high as (in) Europe."
"We don't have a long-term solution for the labelling issue yet. But
for a stop-gap measure, we will issue a certificate for producers of
GM-free products," said Ananta Dalodon, head of the Department of
Agriculture at Thailand's Ministry of Agriculture.
"We prefer not to discuss the issue," a Chinese Foreign Ministry
official told Reuters. Another said China's attitude to GM food was a
"state secret."
Fledgling regulations are also full of holes.
In Japan, food products in which DNA or protein resulting from gene
alteration cannot be detected using current technologies are still exempt
from the labelling requirement.
South Korea has not decided which products will be labelled.
And Australia is yet to decide on thresholds of GM content which
require labelling, as well as on enforcement procedures.
"I don't see us having the extreme emotional debate here (in
Australia) that is in the UK," Monsanto's Brian Arnst said.
The U.S. was treating Japan's response to the GMO debate very
seriously. But Japan could not replace imports of food from the U.S. and
elsewhere with domestic supplies, he said.
"U.S. farmers are pondering whether they should continue to expand
planting of GM soybeans, as they understand they cannot ignore the needs of
food companies in importing countries," said a soybean trader at a major
Japanese trading house.
"I don't expect the ratio of GM soybeans to total soybeans in the U.S.
to rise significantly from the current level," he said.
Australian analysts favour GMO's longer-term chances in Asia.
"Rules are sometimes meant to be broken," one said.