Doing Your Part to Keep U.S. Corn Export Competitive
You’ve read the headlines again and again over the past six months… China continues to reject all corn and DDGs containing Syngenta’s unlicensed trait MIR 162, contained in its popular line of traited corn hybrids, Viptera. Furthermore, it has not yet approved the Duracade corn lines. It was estimated (NGFA: April 2014) that Chinese rejections had already cost US producers and grain companies $3 billion in losses. The losses continue to mount, as each month goes on, currently estimated at the $4 billion mark.
The true reasons for the Chinese rejection don’t really matter (those being financial and political rather than health concerns.) It doesn’t matter that China imports only 1% of the US corn crop. It doesn’t matter that painstaking, repetitious, independent research has proven these hybrids safe and highly effective in combatting certain corn pests and the subsequent diseases that develop in the damaged areas of the plant, even in the ultra-critical EU.
What DOES matter is the disruption to the US export trade, the smooth running of which is invaluable to YOUR corn price, even if you don’t deliver to ethanol plants or export markets. Unless you know for certain that corn deliveries containing any of the Viptera (or Duracade) traits are being consumed by livestock domestically, then that corn that YOU have delivered has the potential to taint thousands of otherwise acceptable corn bushels, rendering them unsuitable for export to key destinations.
Where do U.S. Grain Companies Fall in All of This?
US grain companies are caught in the middle. While they don’t want to restrict the American producer’s access and choice of high performance corn hybrids, they cannot put themselves at risk of having unmarketable product when their blended corn arrives at export terminals. All they can do is ask US farmers who may deliver to markets at all tributary to exports or ethanol channels to keep Viptera and Duracade traited corn completely out of those deliveries, necessarily segregating this corn on farm, until this is resolved. Outright rejections are likely, or, soon, discounts assessed from elevators who can ship to a variety of markets, for restricted hybrids being discovered in delivered bushels.
On the other hand, one enterprising grain company (Gavilon) has stepped forward with an offer to be the buyer of last resort for corn containing the Duracade trait, under the joint “Right to Grow” program with Syngenta.
Syngenta has instituted a stewardship agreement that buyers of Viptera and Duracade seed must sign, acknowledging delivery restrictions and need to segregate grain from these hybrids until the regulatory problems are resolved.
Here are some direct cautions from some larger grain companies:
ADM: Help us keep US Ag Exports Competitive – We strongly recommend farmers verify that their seed varieties are approved for major export markets. We plan to selectively test loads delivered to our grain handling facilities. We reserve the right to reject crops with unapproved traits. If you have seed that is not approved for major export markets, we encourage you to check with your seed sales representative to see if you order can be exchanged for seeds that are approved for global uses.
Bunge: We must reject all grain containing the following germplasm (the following is a picture of signs posted at all Bunge grain elevators.)
We are not saying not to plant Viptera or Duracade hybrids in 2015, which are apparently high performance hybrids, developed from years of research. It’s just that in the current regulatory environment, having even small amounts of finished grain from these seed varieties in your grain deliveries to markets tributary to exports or ethanol production, has the potential to create incredibly expensive losses for your buyer and you.
What Can Farmers Do: To help eliminate trade disruptions such as the issue with MIR 162 in China, farmers must know what markets they intend to sell to BEFORE choosing seed varieties. As planting decisions for 2015 are made, please keep in mind what your buyer wants, and what your buyer cannot accept.
Links to articles of interest:
Manager of Strategic Marketing, FamilyFarms Group