Greenpeace Report Shows GE Industry in Trouble

Greenpeace Report Shows GE Industry in Trouble

FOR IMMEDIATE RELEASE
March 28, 2002

Report Shows Risky Prospects for Gene Altered Crops
genetically engineered food

Today's Agriculture Department release of this season's projected
acreage for genetically engine Biotech industry is struggling as consumers, food
industry and farmers are rejecting Genetically Engineered (GE) food.

These crops show slight increases in plantings of biotech soy and
corn, but consumer concerns about engineered food continue to plague the
struggling biotech crop industry. The biotech industry's prediction that nearly
all plant foods would soon be produced with engineered genes has met consumer
resistance and increasing concern among US food producers, farmers and retailers.
After more than five years of major marketing of biotech varieties, just two
crops still account for almost all of the genetically altered food sold in
US supermarkets.

As outlined in the Greenpeace report, GE Crops - Increasingly Isolated
as Awareness and Rejection Grow, though several biotech crops are at or
near commercial viability, industry has been forced to postpone marketing
genetically engineered sugar, beet, rice, wheat and other varieties.
Furthermore, consumer rejection of gene altered food has forced the
biotech industry to abandon engineered potatoes, tomatoes, and flax after
years of attempting to market these to farmers. Other biotech crops, including
squash and zucchini, are grown by so few farmers that it is difficult to
determine if they are sold in any US supermarkets.

"American shoppers are demanding safe, GE-Free food, and food
companies are responding," said Charles Margulis, Greenpeace Genetic Engineering
Specialist. "First it was Gerber saying no to GE food, now supermarkets like
Trader Joe's have responded to their consumers by promising to take GE food out of
its stores. These companies know that Americans don't want genetic
experiments in our food, and they're sending the biotech industry packing," added
Margulis.

The Greenpeace report shows that the general trend regarding the GE
crop industry is increasing rejection amongst farmers, consumers and the
food industry. Examples of this rejection include:

· Monsanto withdrew GE potatoes from the US market in 2001 after
a series of major market rejections, including by McDonald's, Burger King,
McCain's and Pringles.

· US farmers sought state bans on GE wheat planting, and concern
among growers and millers has forced Aventis to postpone introduction of GE
rice.

· US opinion polls consistently show consumer concern about gene
altered food. A recent Rutgers University Food Policy Institute poll showed
90% of Americans want labels on GE food. This confirmed an ABC National News
poll that also showed more than 90% support for such food labels, and found that
57% would be less likely to buy GE food if it were labeled.


GE crops - increasingly isolated as awareness and rejection grow

With the new planting season starting in North America, this briefing
examines current trends and future prospects for genetically engineered (GE)
crops[1]

· Two countries (the United States and Argentina) account for 90%
of genetically modified organisms (GMOs) in the world. Together with
Canada and China, they account for 99% of GMO acreage.

· Two countries account for most of the remaining 1% of GMO
acreage, South Africa (0.2m ha combined GE corn, soya and cotton) and Australia (0.2m
ha cotton).

· Two crops (soya and maize/corn) account for 82% of the GMO
acreage. Together with cotton and rapeseed/canola, they account for over 99% of
the GMO acreage.

· One trait, herbicide tolerance, has consistently been the
dominant trait during the six-year period 1996-2001, and accounts for 77% of
the GMO acreage. Other traits are insect resistance (15%) and stacked genes
for both herbicide tolerance and insect resistance (8%). These three traits
amount for virtually 100% of commercially grown GMOs.

· One company (Monsanto) almost exclusively dominates the
commercial GMO market. In 2000, Monsanto products alone accounted for 91% of the
total area sown to GMOs[2]. Only three companies account for virtually
all the GMOs currently commercially grown: Monsanto (now Pharmacia), Syngenta
(formerly Novartis/AstraZeneca) and Aventis CropScience (formerly AgrEvo,
recently acquired by Bayer).

1) Four countries account for 99% of GMO crop acreage. What about the
rest of the world?

Annual figures produced by the International Service for the
Acquisition of Agri-biotech Applications (ISAAA) are often quoted to support the
claim that GMOs are gaining worldwide acceptance. However ISAAA is an
industry-funded body sponsored by Monsanto, Syngenta and Aventis. While it is often cited
as if it were an independent body, as an industry mouthpiece, ISAAA routinely
renders its data to show worldwide support for GE crops regardless of any more
reasoned interpretations.

Even according to ISAAA figures, which are themselves difficult to
verify, only 7 other countries commercially grew any GE crops at all in 2001. Spain
grew less than 12,000 hectares (ha) and Germany less than 100 ha of GE
corn. Mexico grew ".a modest area of transgenic cotton and soybean." Indonesia grew
4,000 ha of GE cotton. Romania grew a small volume of GE soya and Bulgaria a
small volume of GE corn however no actual figures for these are given.
Uruguay grew 3,000 ha of GE soya in 2000, but no specific mention of any GE growing
in Uruguay is made in ISAAA's 2001 report let alone any figures. However,
the name stayed on the list as a country growing GE crops. Clearly it strains
credibility to include any of these countries in a list that claims to
show worldwide acceptance of GE crops.

In an effort to claim that GE crops are being widely adopted by and
providing benefit to developing countries, the latest ISAAA report claims that,
".the percentage growth [of GE crops] was higher in the developing countries
of the South..". What they failed to stress was that over 98% of GMOs grown
in 'developing' countries are actually cultivated in just two countries :
Argentina (87%) and China (11%). Soya represents 95% of GMOs grown in
Argentina and is primarily exported to be used as animal feed in developed
countries, while virtually all the commercial GMO acreage in China is of cotton.

2) There is no market for `new` GE crops and the market for the
existing GE crops is rapidly diminishing

GE tomatoes and GE tobacco, the first two GE crops to be
commercialised, have failed to win market acceptance, and have been effectively abandoned,
as neither are currently grown in commercial quantities.

GE potatoes were withdrawn from the US market in 2001 by Monsanto
after a series of major market rejections, including by McDonald's, Burger
King, McCain's and Pringles.

GE flax seed was taken off the market in 2001 under pressure from the
Flax Council of Canada and the Saskatchewan Flax Development Commission
because European customers, who buy 60 percent of Canada's flax, said they did
not want GE.

GE rice has also faltered with Aventis backing off from
commercialising its herbicide resistant GE rice, largely because of warnings from millers
and large value-added domestic and foreign producers that they will reject it.

GE sugar beet has been rejected by US sugar refiners who told farmers
to avoid GE sugar beet because Japan, which accounts for 80% of the sugar beet
pulp market from the US, will not buy GE.

The `StarLink` fiasco: in the US last year, an unapproved GE corn
which was a potential allergen was detected in taco shells and a range of other
food products. This triggered a huge product recall, with related costs
estimated at up to $1 billion. Aventis subsequently decided to abandon US
production of GE `StarLink` corn and withdrew it from the market. Aventis is
currently selling its CropScience division to Bayer.

GE wheat:

GE wheat is already very controversial amongst US & Canadian farmers
who are sceptical of the promised agronomic benefits and very concerned about
the inevitable loss of their multibillion dollar export market.

In February 2001, farm representatives in North Dakota and Montana
sought legislation restricting genetically modified wheat production. Terry
Wanzek, chairman of North Dakota's Senate Agriculture Committee, was quoted as
saying, "These bills are surfacing in North Dakota because of a genuine,
sincere concern for the market. Our major wheat customers say they won't
accept any wheat that has genetically enhanced characteristics, and we're
listening to our customers."

More than 200 Canadian groups, including the National Farmers' Union
and the Canadian Wheat Board, have expressed in the strongest terms their
concerns that GE wheat will damage exports. Growers in Colorado and Oklahoma are
telling farmers to "stay away from it". David Payne, director of Louis Dreyfus
Negoce, was recently reported saying "[GE wheat has] definitely become an
issue in the Middle East. People just don't want it". He said US wheat officials
had heard similar fears from end-users during recent promotion drives in the Far
East.

Monsanto has now pushed back the proposed introduction of its GE wheat
from 2003 until 2004- 2005 and has publicly stated that it will only do so
if it can first gain pre-acceptance from buyers as well as environmental and
health clearance from regulatory authorities. Pharmacia, which bought
Monsanto's Ag Biotech division, is now looking to sell it again before the end of
this year.

GE Fish:

The US Food and Drug Administration (FDA) is currently considering the
first application for commercial use of GE fish. GE salmon will grow faster
than conventional salmon. But this GE fish has been widely condemned by
the fish farming industry, the food industry, and the scientific community. The
public rightly wants nothing to do with it and international political action
is underway to prevent any release of GE aquatic species to the
environment.

The seven member countries of NASCO (the North Atlantic Salmon
Conservation
Organisation) have agreed to, "take all possible actions to ensure
that the use
of transgenic salmon. is confined to secure, self-contained,
land-based
facilities". Member countries include the US & Canada, European Union,
Russia
and Norway. It will likely be impossible to raise commercial
quantities of GE
salmon in such land-based facilities.

At the North Sea Ministers Conference in Bergen, Norway earlier this
month (21st March), European governments took the opportunity to reinforce
their position, ". in order to prevent their release to the marine
environment [of genetically modified marine organisms]." In the US, the state of
Marylandintroduced in April 2001 the first law prohibiting the raising of GE
fish unless they are in ponds or lakes that do not connect to other state
waterways. The California state legislature is currently reviewing a similar
bill, as well as one that would require labeling of any GE fish sold to consumers.

The scientific consensus appears to be that GE fish will not pass an
examination of the potential human health and environmental dangers.
However, even if they did, there would still be no market for them,
domestically or internationally.

GE soya:

Soya buyers in the European Union, Asia & Australasia are purchasing
non-GE soya from Brazil, India and US & Argentinean exporters who have
recently set-up segregation systems to meet that demand. China with its new GMO
legislation, and its roughly 12% share of the world soya import market, has started
this year to create pressure for soya exporters to supply non-GE soya.

Despite a massive political and financial battle by Monsanto, Brazil
has until now maintained a ban both on the growing and import of GE crops. Even
if Monsanto overcomes that legal ban they are expected to meet stiff
resistance from Brazilian soya exporters who have made huge gains by exporting
guaranteed non-GE soya. Brazilian consumers and food industry are also likely to
reject any use of GE foods and if commercialisation does go ahead at the
national level, growing may be banned or severely curtailed by several state
governments.

The US Department of Agriculture in May 2001 stated that, "Over the
last 12 months, demand for certified biotech-free soybean meal has grown from
near zero to 20-25 percent of the EU market according to officials in the
compound feed industry". Since then there have been a further series of commitments
by major companies across Europe to use only non-GE feed.

Since the main market for GE soya is as animal feed, the volume of GE
soya being grown in the US and Argentina would be expected to reduce
significantly once demand for non-GE animal feed on international markets and within
the US significantly increases. That process has started and is gaining pace,
but Monsanto has worked over time with major grain buyers to maintain a
continued market despite the increasingly hostile climate for its GE crop.

3) International law is catching up with GE crops and labelling of GE
food is becoming standard practise throughout the world.

More than 35 countries have laws either in place or announced which
require the labelling of food containing GE ingredients, or which restrict the
import of some GMOs. These countries combined include more than half the world's
population.

Japan, which takes 20% of all US food exports, worth $ 11bn a year,
recently announced a revised biotechnology labelling regime that adds potato
products to the labelling scheme which imposed tough rules on an initial list of
24 product categories. In South Korea, the government requires mandatory
labelling of GE foods and a recent amendment now means that advertisements in
newspapers, magazines and TV commercials also have to indicate the presence of GE
ingredients in food products.

China abandoned commercial growing of GE tobacco in 1998 and has
recently introduced GE labelling laws and requirements for safety certification
for allGE foods. Since China is the world largest single importer of
soyabeans, this is already causing serious disruption of US soya exports. China's
Dalian Commodity Exchange recently introduced new contracts for
non-transgenic soybeans to conform to the country's rules on GMOs. Trading of non-GE
soya futures in Japan's Tokyo Grain Exchange started already in June 2000,
and has exceeded trading in GE soya.

The European Commission proposed in July 2001 new regulations on
traceability and labelling of GE food and animal feed. The tightened labelling
regime would include products derived from GMOs such as oil and starch as well as
animal feed. Traceability of GMOs is included in the proposed regulation for
the first time. Although some GMOs such as Monsanto Roundup Ready Soya, Aventis
rapeseed oil and Syngenta Bt maize have clearance for use in food products in
the EU, a de-facto moratorium on any new GE product approvals has been in place
since 1998. Luxembourg, Austria and Germany have further banned Syngenta Bt
maize, while France and Greece have banned Aventis rapeseed.

Thailand, the world's largest rice exporter, is expected to introduce
labelling legislation this year.

Australia and New Zealand have adopted a mandatory labelling regime
for GE food, which came into force on December 7, 2001.

In Bolivia a Ministerial Resolution was passed in January 2001
prohibiting the import and use of any GMOs for a period of one year. In September
2001, Croatia drafted a law proposing to impose a ban on the import, placing on the
market, use and production of GMOs and GE products. In the Czech Republic,
since January 1, 2002 all GE food products have to be labelled. The 13
countries applying to join the EU will eventually be covered by EU legislation
of GE crops including strict labelling and safety testing requirements.

In Paraguay, the use of GE soybeans in the agricultural sector was
banned in 2000/2001. In the Philippines there are a number of bills before the
Senate and Congress concerning the labelling of GE crops. Labelling legislation
is also in preparation in Hong-Kong, Israel, Mexico and Brazil. GE food
labelling is already mandatory in Indonesia, Latvia, Saudi Arabia, Switzerland and
Norway. Bills to restrict GMO planting or for labelling of GMOs currently
being discussed in many US states, the Canadian Parliament and in Mexico.

4) International markets are rejecting GE crops in food and in animal
feed Virtually the entire European food industry has already taken action
to ensure that no GE ingredients are directly used in any of their food
products. Such policies are being actively pursued by major retail groups and food
manufacturers, including Carrefour, Tesco, ASDA (Wal Mart), Nestle,
Unilever, Heinz and many many more. A significant number of these have already
extended their policy to cover animal feed.

The first mainstream US retailer, Trader Joe's, recently followed the
major healthfood retail chains Whole Foods and Wild Oats in rejecting GMOs
saying that the policy is the result of "talking with our customers," and
finding that "it is clear ... that if given the opportunity, the majority of our
customers would prefer to have products made without genetically engineered
ingredients".

In 2001, the value of US corn exports to the European Union was a mere
0.6% of what it was before the introduction of GE corn : $305 million in 1996
down to $1.8 million in 2001, according to USDA statistics.

97% of the world's GE canola is grown in Canada. It was introduced in
1996 and now accounts for about 66% of Canadian Canola. By 1998 Canada had
entirely lost its $300-400 million annual sales of canola to Europe.

5) Public opinion continues to reject GE foods

Consumer rejection of GMOs in Europe is well known. These latest polls
from Asia, Canada and the US show GE rejection growing internationally.
Surveys in these regions appear to be following the same trend as in the EU, i.e.
increasing knowledge equalling increasing rejection.

On November 16, 2001, the Rutgers University Food Policy Institute in
the U.S. released a study confirming that the vast majority of Americans
surveyed want GE foods labelled. This study is the second major poll recently
conducted of U.S. attitudes toward GE foods to determine that upwards of 90 percent
want labelling legislation. ABC News conducted the other poll in July of
the same year. Furthermore, the study finds that Americans are highly sceptical
of GE foods and the motivations of the producers of such foods, believing
that most are in it for the money and not because consumers want it. 48 percent
say that they would not buy fresh vegetables if they were labelled as produced
through genetic engineering. The study also reveals that most Americans know
little about genetic engineering or which of their foods are genetically
engineered, yet 75 percent of those surveyed knew enough to agree that, "The
potential danger from genetic modification [of foods] is so great that strict
regulations are necessary." Nearly 60 percent also feel that, "The government does
not have the tools to properly regulate [genetically modified] foods."

6) Farmers are also waking up to the problems and false promises of
GMOs:

"Farmers are really starting to question the profit-enhancing ability
of products that seem to be shutting them out of markets world-wide"

- Cory Ollikka, Canada's National Farmers Union president calling for
a moratorium on GE crops, December 2000.

In the USA and Argentina, soya farmers have been won over by the
industry's promises of better yields and lower costs. A number of studies in the
last four years have found these promises to be false - some found that GE
agriculture had no net effect on farmer profitability; some that it had a negative
effect.

For example:

(1) Charles Benbrook, Northwest Science and Environmental Policy
Center, Sandpoint Idaho, May 2001 report, 'Troubled Times Amid Commercial
Success for Roundup Ready Soybean' - found that Roundup ready soyabeans require
more herbicides than conventional soyabeans and yield up to 10% less;

(2) Institute of Agriculture and Natural Resources, University of
Nebraska, study of 1998 and 1999 Nebraska soya crop - found lower yields for GE
varieties;

(3) Leopold Centre for Sustainable Agriculture, Iowa State
University, survey of Iowa soya and maize crops, 2000 - found that total extra costs
(e.g. for seeds) were roughly equal to total savings plus yield gain - i.e. no
net economic advantage to farmers;

(4) OECD annual report, 2000 - indicated confusion about whether
there is benefit to farmers from GE crops; found that no conclusion on overall
profitability can be drawn.

7) Future prospects for GE crops

After five years of commercial growing on GE crops in the Americas,
predicted environmental problems such as triple herbicide resistant canola crops
in Canada are already a reality which farmers end up using a cocktail of
chemicals to get rid off. The false promises of increased yields from GE crops
have also been exposed. For example, an average 5 percent yield loss has now
been regularly recorded with GE soya.

With increasing worldwide legislation of GE crops, increasing
international market rejection of GE crops, increasing demands for labelling and
safety testing of GE crops on one hand and growing awareness and rejection of
GE food by consumers, farmers and the food industry on the other, the
increasing acreage of GE soya appears as an anachronism created more by political
and monopoly influence than by market demand.

[1] Statistics in this section are from ISAAA, Global
Review of Commercialized Transgenic Crops 2001.

[2] Monsanto claims that the number of acres planted with
its biotechnology traits amounted to 118 million acres in 2001 (Monsanto's
Fourth- Quarter 2001 Earnings Per Share, 5 February 2002, www.monsanto.com),
which makes 91% of the 130 million acres planted with GMOs according to
ISAAA (ISAAA, Global Review of Commercialized Transgenic Crops 2001).


CONTACT: Charles Margulis, Greenpeace (202) 413-8512 (mobile); Alisa
Arnett, Greenpeace Media, 415-255-9221 x330.

Greenpeace is committed to protecting the planet from genetic
pollution by preventing the release of genetically engineered organisms into the
environment

.


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