GM mystery rattles wheat markets
How the altered crop made its way to the Oregon field remains a mystery. The strain was developed by Monsanto to make wheat resistant to the company's industry-leading weed killer. Monsanto tested the type of altered seed in more than a dozen states, including Oregon, between 1994 and 2005, but it was never approved for commercial use.
Yet the US Agriculture Department reported that recent tests identified the strain after an Oregon farmer trying to clear a field sprayed Monsanto's herbicide, Roundup, and found that the wheat could not be killed.
The report rattled US wheat markets. In addition to Japan's action, the European Union, which imports more than 1 million tons of US wheat a year, said it was following developments "to ensure EU zero-tolerance policy is implemented". It asked Monsanto to help detection efforts in Europe.
The developments focused attention on Monsanto, a $US56 billion ($58 billion) company with more than $US13.5 billion in sales of seeds, services, weed killer and biotechnology to the agriculture industry. In the face of mounting protests, including a series of public demonstrations in multiple cities last weekend, the company has stood behind its other genetically modified products.
Many food safety advocates and environmental groups say that more testing needs to be done to ensure genetically modified seeds don't harm human health. In addition, they say, the genetic engineering of crops has encouraged the more widespread use of herbicides and led to the development of weeds more resistant to those herbicides.
The US already relies heavily on genetically modified crops. Genetically engineered corn, cotton and soybeans have gone from 5 per cent to 17 per cent of the US market in 1997 to between two-thirds and more than 90 per cent last year. By some estimates, more than 70 per cent of processed foods sold in the US contain ingredients and oils from genetically engineered crops.
But Americans remain sceptical about some genetically modified foods, including current proposals to cultivate altered salmon. And big agriculture companies have avoided commercial development of genetically engineered wheat because about half of the US wheat crop is exported and governments in major markets such as the EU, Japan and China are opposed to genetically modified wheat seed.
Monsanto said in a statement that it ended commercial development of the strain of wheat found in Oregon nine years ago. The company said about 58 million acres of wheat is planted in the US every year and that while the Agriculture Department's test results in Oregon "are unexpected, there is considerable reason to believe that the presence of the Roundup Ready [herbicide-resistant] trait in wheat, if determined to be valid, is very limited".
But food safety groups drew the opposite conclusion.
"This was not from a recent trial, which means it's been sitting there in the environment," said Andrew Kimbrell, executive director of the Centre for Food Safety, a non-profit group. "It's highly doubtful that it's just on one farm."
The centre's science policy analyst, Bill Freese, said: "It's been 12 years since this wheat was grown officially in Oregon. It doesn't just disappear and magically appear 12 years later."
Mr Freese said Monsanto had 15 new permits, issued in 2011, to test herbicide-resistant wheat in Hawaii and North Dakota, including an unusually large 120-hectare field in North Dakota. He said the size of that field would make it difficult to prevent accidental spread.
Tom Helscher, a Monsanto spokesman, said the new field tests involve "different herbicide traits" than the genetically modified strain found in Oregon. He said they are "focused on preventing yield loss due to disease and other environmental stressors".
Mr Helscher said the company has a project in early development that would boost yields and provide crops with a "strong tolerance" to existing herbicides.
Mr Helscher said that "we talk to people in the wheat industry and they say they need tools to help deal with problems they face, whether weed or insect control".
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The disruption began when unapproved genetically modified (GM) wheat — a Roundup-resistant strain developed by Monsanto — was discovered in an 80-acre field in Oregon. After US Agriculture Department tests identified the trait, major buyers such as Japan suspended imports and cancelled a large purchase, rattling US wheat markets.
Japan, one of the largest markets for US wheat exports, suspended imports and cancelled a major white wheat purchase after the discovery of unapproved Roundup‑resistant wheat in Oregon. The move reflects concerns about genetically modified wheat entering supplies and Japan’s sensitivity to GM crops.
The strain was developed by Monsanto to resist its herbicide Roundup and was tested in more than a dozen US states between 1994 and 2005. It was never approved for commercial use; Monsanto says it ended commercial development of that particular strain nine years ago.
The US Agriculture Department reported the strain was identified after an Oregon farmer found wheat in a field wouldn’t die when treated with Monsanto’s Roundup herbicide. Subsequent tests by the department detected the Roundup‑Ready trait.
The European Union said it was monitoring developments to ensure its zero‑tolerance policy is implemented and asked Monsanto to assist detection efforts in Europe. Japan suspended imports, and other food‑safety groups and environmental advocates called for more testing and investigation.
The article notes that about half of US wheat is exported and many major export markets — including the EU, Japan and China — oppose genetically modified wheat. That export sensitivity has discouraged commercial development of GM wheat despite widespread use of GM traits in other crops.
Investors should note the discovery rattled US wheat markets and prompted import suspensions by major buyers, which can affect export volumes and prices. Companies tied to seed, herbicide and commodity markets — such as Monsanto, a large seed and agrochemical company mentioned in the article — may see reputational and regulatory scrutiny that could influence market sentiment.
Monsanto said the Oregon test results are unexpected but suggested any presence of the Roundup‑Ready trait in wheat is likely very limited. The company noted it ended commercial development of that strain years ago and said recent field tests in 2011 involve different herbicide traits. A Monsanto spokesman also described an early‑development project aimed at boosting yields and tolerance to herbicides, and said the company communicates with the wheat industry about tools to address weeds and yield threats.
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