World Grain - November 2006 - 68

FEATURE: MARKET FOR GM WHEAT STILL CLOUDED

wheat from those of two years ago,"
Wisner said in the report.
In May 2004, the Monsanto Co.
shelved plans to commercialize the
first biotech wheat - Roundup Ready
- which is genetically modified to resist applications of its broad-spectrum

The WTO report requires E.U. member
states to eliminate national bans on
products already approved by the E.U.
France, Germany, Luxembourg, Austria, Italy and Greece have each banned
E.U.-approved biotech products but
did not provide sufficient scientific

"We have not seen evidence, either from the WTO (World
Trade Organization) policies or other developments, that consumers in major foreign markets are significantly changing
their views toward GM Roundup Ready wheat from those of
two years ago,"
Robert Wisner, Iowa State University economics professor

herbicide. A statement released by the
company said the basis for its decision
was the lack of farmer and consumer
acceptance. The only variety of genetically modified wheat currently being
developed for possible commercial release is being modified to increase resistance to fusarium head blight.
U.S. wheat organizations have been
concerned that wheat acres are being
shifted to GM maize and soybeans
because they are cheaper to plant and
less susceptible to diseases than wheat
and thus more appealing to farmers.
These organizations and growers believe that commercializing a biotech
variety of wheat would gain back some
wheat acres lost to maize and soybean
production.
Wisner's report notes that wheat
acreage is declining in part because of
changing U.S. agricultural policy, increased production of crops suitable for
the rapidly expanding biofuels market
(maize and soybeans) and extremely
rapid growth in Chinese demand for
soybeans.
LATEST WTO REPORT
In October, the WTO released a report that said the E.U.'s failure to act
on biotechnology approvals was, in effect, a moratorium on biotech products.
70

evidence of risks to either people or
the environment, according to the
WTO report.
But Wisner said he doesn't expect the
WTO's report to have much immediate
effect on the GM wheat situation in the
E.U. He said the WTO decision "does
not appear to prevent the E.U. from
using its GM labeling and traceability
program." The labeling program allows
consumers to choose between GM and
non-GM foods, and Wisner noted that
"it is the consumer that determines how
the market will react as long as the consumer has a choice."
In the report, Wisner notes that no
technology has been developed that
would significantly reduce the costs of
segregating GM and non-GM wheat
supplies in marketing channels at tolerance levels currently specified in
Europe. If a low-cost acceptable segregation system is developed, it would
increase the likelihood of market acceptance of GM wheat. "With the low
tolerances required for GM food ingredients in some foreign markets, effective market segregation to meet those
low tolerances would be important if
negative impacts on export demand
from commercializing GM wheat are to
be avoided," Wisner said in the report.
Some supporters of GM wheat have

pinned their hopes on other GM crops
gaining acceptance in the E.U. and
opening the door for GM wheat varieties. In the past couple of years, new
varieties of soybeans were developed
through conventional breeding that offered potential health benefits, such as
a reduced risk of heart disease. Seed
companies inserted a GM herbicide-resistant gene in some of these varieties,
and there is speculation that they might
gain acceptance in foreign markets.
However, Wisner's report said that
so far these new low trans-fat soybean
varieties have not changed European
attitudes toward GM foods. For the
2005-06 soybean marketing year, U.S.
soybean exports to the E.U. dropped
by 54% from the previous year. U.S.
soybean meal exports to the E.U. have
fallen from once-large volumes to almost economically insignificant levels,
the equivalent of the meal from 0.03%
of last year's crop. Until the late 1990s,
the E.U. was a major importer of U.S.
maize, but its imports in the marketing
year ending Aug. 31, 2006 represented
0.06% of the 2005 U.S. crop.
POTENTIAL IN CHINA?
The report mentioned that based partly
on China's purchases of U.S. soybeans, a
number of market analysts believe China's wheat import market is potentially
less sensitive to GM wheat issues than
that of other countries. China consumes
more soybeans directly for human food
than western nations, although most of
its imported soybeans are processed into
soybean oil and meal.
China is the world's largest importer
of soybeans and purchases supplies
from both the U.S. and South America.
U.S. soybeans are mostly GM varieties,
as are those from Argentina.
Unlike wheat-based foods, much of
China's soybean imports are processed
so that GM soybean protein is removed
from the oil, and the meal is mainly
fed to livestock and poultry. Therefore,
Wisner said the Chinese consumer attitudes may not be a reliable indicator
of potential acceptance of GM wheat.
November 2006 / World Grain / www.World-Grain.com

http://www.World-Grain.com

World Grain - November 2006

Table of Contents for the Digital Edition of World Grain - November 2006