Select Committee on European Communities Minutes of Evidence

Examination of witness (Questions 400 - 419)



Lord Wade of Chorlton

  400.  The point is that that situation might well be reached in Europe. Certain consumers want that choice and if it means extra so be it. You say that these products can be segregated if there is a clear consumer decision to pay the extra cost involved. You and US farmers because of your confidence in the system see no difference in these products. They do not demonstrate any difference. That is not so in Europe. Our people think that they are different. In those circumstances, do you see that segregation can take place on the basis that they are different products and perhaps command a different price in the marketplace because of segregation?

  A.  It could develop that way. If it did develop that way it would be a natural development that we would support and endorse. I would view that situation as similar to the current differences between organic and conventionally produced commodities. In general, the public is willing to pay a premium for organic products because it feels that such product are better for whatever reason. But that is a natural development in the marketplace as a result of consumer preferences.

  401.  You are saying that the initiative to bring about segregation must come from a clear indication by consumers that they are willing to pay for it. Some importing organisation in Europe must then negotiate with specific growers and say, "Okay, you segregate these products and we will deal with it right the way through the chain to the consumer"?

  A.  Correct.

Lord Moran

  402.  Would it be practicable at reasonable cost for a supermarket chain in Europe to contract with a group of US farmers to be supplied with unmodified soya given what you say about the fact that US farmers put the product together and it all goes to the same elevator?

  A.  It depends on one's definition of "reasonable cost". I do not think that farmers would be willing to do it as a matter of routine. They would rather produce and market their commodities mixed together because they would view the soybean as a fungible commodity. Unless it had a different end-use characteristic they would tend to mix the genetically modified with the conventional. But where someone was willing to provide a premium—it would depend on how great it was—our farmers would be willing to undertake the necessary expense of responding to that specific demand.

Lord Rathcavan

  403.  The Sub-Committee has received evidence that some Brazilian soya producers are supplying non-GM soya products to certain outlets in this country and not at a premium price, so it can be done. Is it correct that the US Government has put pressure on Brazil not to segregate their soya products?

  A.  It is not correct that we have put any pressure on the Brazilian Government to segregate their products. We have not intervened in that issue in any way at all, as far as I know. To my understanding Brazil has offered soybeans that are not genetically modified, but that is simply because that country has not approved the commercial production of the genetically modified product. Therefore, all it has had to offer is the conventional product. There was no segregation required by any producer in Brazil. In that respect it was very easy for Brazil to say that it could offer only the conventional product. One issue that Brazil faces is whether it should authorise the planting of genetically modified soybeans for commercial use. From my observation, they will be making that decision over the next year or two, or possibly three. Argentina is another example. Argentina has already approved the commercial production of genetically modified products, so that country is embracing the new technology. Our assumption is that the new technology will continue to spread as long as the approving countries are confident that these products are safe for the consumer and environment.

Lord Moran

  404.  As I understand it, the US has not ratified the Convention on Biological Diversity but you are taking a role in the negotiations in Montreal now going on in relation to the protocol on the trans-boundary movement of living modified organisms (LMOs). How is that proceeding? What do you understand by the term "LMO"? Do you think that the regulatory structures should apply only to such organisms and not to the products derived from them?

  A.  You have accurately described the situation in terms of the US's involvement. Even though the US is not a member it is trying to stay engaged in the debate. We hope that the focus in the discussion is on those items that pose significant risks to biodiversity. Our concern, given the current debate, is that notification requirements may go beyond just those products that pose a risk to biodiversity. If such a broad procedure is put in place it may be very harmful and disruptive to trade. The focus of our efforts is to make sure that any agreed procedure would be imposed only in the case of products that posed a significant risk to biodiversity. One of our concerns about the definition of "living modified organism" is that it should not be applied to processed products. We believe that processed products do not constitute a living modified organism.

  405.  Are you reasonably optimistic that the negotiations will end in a situation that you regard as reasonable?

  A.  We are not optimistic given where the debate is currently. We are hopeful, not optimistic.


  406.  I am not sure I understand why the United States has not signed the convention. What is the reason for that?

  A.  I have not been involved in all the various reasons why we have not signed the protocol. I would be happy to provide that for the record, if I may.

  407.  Is it not a matter of considerable importance, even urgency, that there should be international agreement on many issues raised by genetically modified crops?

  A.  Legitimate issues have been raised, but the question is: How far do we go with regulation? We say that where there is risk to the importing country, then by all means notification should be required. But if there is no significant risk we do not believe that notification is warranted.

Lord Wade of Chorlton

  408.  That would be your decision, not that of the buyer or consumer, on the degree of risk?

  A.  In this case I do not think that it is just a matter of US determination of the risk. That sort of risk assessment would take place under codex and similar international standards.


  409.  Turning to the subject of trade disputes, is one imminent in relation to GMO? Are you playing a leading role in the pursuit of any trade disputes with the European Union in particular as far as genetically modified crops are concerned? You provided some details about the import of corn into France. There was another case in which imports of corn into Spain and Portugal were in jeopardy.

  A.  That is an issue that we are following very closely and are concerned about. France's failure to grant final approval on these two corn varieties has meant that we have not been able to ship any corn to Portugal or Spain this year. Because of that we estimate that we have lost about $200 million in corn sales to Europe in the first six months of this year. In our view this issue must be resolved in about the next two weeks if we are to have an opportunity to ship corn prior to Spain's grain harvest; otherwise, we shall lose all sales opportunity for the year. We will not have an opportunity to recover it.

  410.  You have not yet received any indication as to whether or not you will be able to move it in the next fortnight?

  A.  We have not received a final determination.

  411.  If not, will you be pursuing compensation claims and, if so, against whom would those claims be made? Who would be conducting them?

  A.  I cannot say here today that we are threatening to pursue a trade dispute. All I can say is that we view the matter very seriously. We are very concerned by the potential loss of $200 million in trade, but are hopeful that it will be resolved over the next few days.

Lord Moran

  412.  I want to ask about the general question of consumer confidence. You will know that we have had a hugely damaging and costly problem with BSE in this country and to a lesser extent a problem with E coli 0157. As a result, there has been a great diminution in consumer confidence in food products and a reluctance to accept official assurances. This applies not only in this country but throughout the EC. Do you have a view as to how that should be communicated to the consumer? Have consumers in the US been persuaded that GM technology benefits them and not just benefits producers and big companies? Do you think that acceptability would be affected by nutriceuticals and plants containing animal (including human) genes?

  A.  A number of things come to mind. We are aware that the BSE crisis has probably done a great deal to undermine the confidence of European consumers in the ability of government to protect consumer health. We are very sympathetic to your predicament in that respect. In the US we are fortunate that consumers tend to have a great deal of faith in the Food and Drug Administration, Environmental Protection Agency and the Department of Agriculture. Perhaps that is why our consumers do not express any apparent concern about biotechnology. It is interesting and ironic that if you asked our consumers what example of agricultural biotechnology they were most aware of it would probably be Dolly the sheep. It is ironic that Dolly was produced here where the concern about agricultural biotechnology is greater. I am not sure why it is that Dolly has received so much attention in the US. Perhaps because she is so cute and it makes for a good photograph. But that is an issue of which everyone is aware. In the US there is acceptance of that technology but it is viewed as more dramatic than genetic modification of plant species. Even though the technology is different, it is all agricultural biotechnology. I think that the average consumer would view cloning as a much bigger and more dramatic step than altering the specific genes of plants.

  413.  Particularly if it involves human genes?

  A.  Certainly, the concern in that regard is greater. But I question just how different the concern over genetic modification is here in Europe. As you may know, three or four weeks ago there was a referendum in Switzerland. Up until that time it was assumed that the Swiss public was opposed to that sort of technology. That referendum, which was anti-genetic modification, was defeated two to one. Clearly, in that case the public examined the issue and endorsed the technology. Perhaps there are real opportunities with further education and greater transparency in the whole process to increase public confidence and acceptance of the technology.

  414.  Concerns have been expressed here by quite serious people. For example, today, English Nature, which is the Government's own adviser on nature conservation, has called for a moratorium on the commercial planting of genetically modified crops until 2002 to allow research to take place. That reflects a degree of public anxiety.

  A.  I understand. Related to that, certainly the statement of Prince Charles three or four weeks ago also received a lot of attention in the US.


  415.  There are various environmental concerns apart from those mentioned by Lord Moran. Witnesses have referred to concerns about the creation of a super weed and the possibility of the escape of genes from genetically modified plants into their relatives in the wild. In that context, one witness drew attention to the fact that in the United States genetic modification would take place in native species and it posed a huge risk for the US. He did not understand why United States' consumers were not more concerned about it.

  A.  That is a legitimate issue to raise and examine, just like the issue of resistance, but in the end the question is: What steps are the regulatory agencies taking to guard against any adverse effect? I have to fall back on our confidence that the regulatory agencies are examining those very issues and concluding before they approve any product that the risks are minimal or non-existent. The issue of introducing non-native species is a very broad and important one. It goes beyond the whole question of genetic modification or traditional plant breeding. I recall seeing an article in the papers just a week ago about how a non-native species of fish—the northern pike - had been introduced into a lake in California and it killed all the native trout. The whole issue and risk posed by the introduction of non-native species is something that we face regardless of whether or not the non-native species is the result of genetic modification.

  416.  If I understood the witness correctly, he was more concerned with the modification of native species of crops in the United States and the greater likelihood that genes could cross with weeds and so on and produce problems in that area.

  A.  That may be a legitimate concern, but I hope it is one that is fully taken into account by our regulatory agencies before they approve a product.

  417.  In any event, it is not an issue that has been widely raised by environmental groups or consumers generally?

  A.  It is raised but, like the issue of resistance, it is one of the matters that is methodically examined as products are submitted for approval.

Lord Moran

  418.  One of our witnesses, Professor Beringer, who is an expert in this field, raised the question whether there is a hole in our regulatory system in that no Government advisory committee here is looking specifically at the impact of changing agricultural practice on wildlife populations. Is that a concern in the US? Which US regulatory organisation is responsible for that? Is it a real problem?

  A.  We have not found that to be a particular problem in the US with respect to genetically modified commodities. There is great interest in maintaining or increasing wildlife numbers. We have been quite successful in the US in increasing our bird and deer population—to the point where deer are much more of a nuisance in the US. If we look at black bears, bald eagles and other species, wild life numbers have increased dramatically over the past 20 years because we have a conservation reserve programme that has converted millions of marginal acres of farmland into conservation uses, permanent grassland and so on. All of that has helped wild life numbers to recover. There is an opportunity here with genetic modification because that could increase the diversity of crops. It provides an opportunity to support increased numbers of species. I have an article here which talks about the interest on the part of farmers to "break from the shackles of producing no.2 yellow corn". No.2 yellow corn is such a standard commodity that today farmers who want to maximise their income are very interested in trying new and different commodities. That is why they feel that genetic modification is exciting. It may offer opportunities to diversify their production. That is part of the reason they are embracing the technology.

Lord Redesdale

  419.  One of the problems with the technology is that if something goes wrong and, for example, a superweed is created, it may be unstoppable. Would that be the responsibility of the Department of Agriculture in the US? Who would foot the bill? Would the cost be met by the insurance companies of genetically modified crop producers?

  A.  I am not sure that if a problem developed it would necessarily be unstoppable. One might be able to control some of the problems that occurred. Generally, it is up to our Animal and Plant Health Inspection Service to try to go out and eradicate any particular weed species that may develop and cause problems. Typically, that agency co-operates with state governments on those kinds of eradication programmes. It may be that someone would have a basis for bringing suit against the manufacturers of a genetically modified product, but it is hard to say if that person would prevail in such a case.

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