GMO sales and economic risks (21/4/2003)

21 April 2003

GMO sales and economic risks

Good to know that Africa will have an industry-backed 'non-profit organization' to 'Promote GMO Sales'! (item 1)

*Africa: Group to Promote GMO Sales
*US: Groups Warn Kraft of Economic Risks of Biotech Foods
*US: Stubborn weeds a threat to Roundup's revolution
Africa: Group to Promote GMO Sales

A former director of the West Africa Rice Development Association will head a new organization later this year called the African Agricultural Technology Foundation (AATF). The goal of the AATF will be to work with governments, companies, non-governmental organizations, and research centers to negotiate the sales rights of genetically modified crops and bring new agricultural technologies to the African market.

The AATF will operate as a non-profit organization, and will receive support from the Rockefeller Foundation, the United States Agency for International Development and several major agricultural companies including Monsanto, Dupont, Dow Agro Sciences LLC and Syngenta.

April 18, 2003
New Zealand Herald

The Green Party says it is outraged by the Government's reaction to a report released yesterday on the economic impacts of releasing genetically engineered organisms in New Zealand.

"The report actually shows that there are more likely to be negative effects on the economy from GE release than positive effects, under realistic conditions," Green Party Co-Leader Jeanette Fitzsimons said.
"The Government has chosen to ignore the parts of the report that show that demand for New Zealand products will dramatically decrease if GE is released here.

"It is outrageous that Ms Hobbs is saying the report is great news for GE because, according to her, there won't be catastrophic effects on the economy.  But that's not good enough - if the Government can't show significant benefits for New Zealand from GE release, it should not be exposing us to the risk."

The report, by Business and Economic Research Ltd, Economic Risks and Opportunities from the Release of Genetically Modified Organisms in New Zealand, was originally due in February.  Ms Fitzsimons said the report shows that although the impact on the overall economy is most likely to be slightly negative or neutral, the impact on the agriculture sector is likely to be devastating.

"A 20 per cent decrease in demand for dairy, meat and fruit as a result of GE release in New Zealand could lead to a 40 per cent reduction in producer returns. This is extremely bad news for farmers and growers." She said the key finding of the report was that the negative effects of overseas markets buying less of New Zealand products because people don't want GE food, would have a much greater economic effect on New Zealand than any positive effects from increased productivity or lowered price.

April 17, 2003
Sustainability Council of New Zealand  Media Statement
A study undertaken for Government has failed to show any sure economic gains from releasing GMOs.  It shows no concrete benefits that would justify New Zealand giving up now its status as a GM Free Food Producer, said Sustainability Council chair Sir Peter Elworthy.  The report states that the overall outcome for the economy ten years from now could be positive or negative depending on the assumptions. All the positive assumptions are entirely hypothetical.  They relate to three GM products that are still under development and may never be commercialised.

Yet the main negative influence is verifiable today.  It is the negative impact on New Zealand's clean green image that results in consumers shying away from buying New Zealand goods.  It is the strong and widening rejection of all GM food products in the marketplace.  The study's market research reflects this.

The overall picture is one of demonstrable costs versus highly speculative benefits.

The study neither asks nor answers the real question: is there good reason for New Zealand to allow the release of GMOs now?  Instead, it asks what might be in ten years time. Why base a decision today on what may never be realised ten years from now?  New Zealand can decide to allow a GM release at any time in the future. So why make a decision before it's needed, especially if there is no going back?  Why pave the way for GM release now in the face of the market resistance recorded by the study.

New Zealand depends on primary production for half its export income. This is five times the OECD average and makes the stakes five times higher for New Zealand in taking on GM agriculture.

The study reports that 20% to 30% of overseas buyers would cease to buy New Zealand goods if GMOs were released.  This alone gives a clear indication of the huge economic risk New Zealand would take in giving up its status as a GM Free Food Producer.

Nothing to date has provided a sufficient economic justification for paving the way for GM release at this time. Conditions could change in the future but there is no point in committing early to an irreversible course.
Groups Warn Kraft of Economic Risks of Biotech Foods

SAN FRANCISCO, California, April 18, 2003 (ENS) - Environmentalists believe Kraft Food's use of genetically engineered, or biotech, foods is a financial risk to the company and its investors because of potential product recalls and liability lawsuits.

The report, "Risky Business: Financial Risks that Genetically Engineered Foods Pose to Kraft Foods, Inc. and Shareholders," was released yesterday by the As You Sow Foundation and the National Association of State Public Interest Research Groups (PIRGs).

 It details additional financial risks to Kraft from its use of biotech foods, including loss of competitive advantage, possible consumer backlash and potential damage to the company's image because of the biotech controversy.

And the report says that biotech foods do not provide Kraft any measurable financial benefits, nor do they provide any marketable benefits to consumers.  "Continued use of genetically engineered ingredients is a no-win situation for Kraft and shareholders," said Kate Madigan, advocate for the National Association of State PIRGs and author of the report. "Kraft is gambling with controversial ingredients when there is nothing to gain from doing so."  The environmental and health risks and benefits of biotechnology has sparked a worldwide debate over the safety and necessity of genetically modified foods, with the United States the leading advocate of widespread use of biotech crops. It is estimated that some 70 percent of processed foods produced in the United States have some trace of biotech crops, mostly corn or soybeans.

The report uses the StarLink contamination of the food supply in 2000, which the authors say cost the food industry billions of dollars, as evidence of the financial risk from biotech foods to Kraft. Starlink, a variety of biotech corn that was not approved for human consumption because of allergy concerns, was first discovered in Kraft's Taco Bell brand taco shells, according to the report.

"Kraft derives no financial or nutritional benefit from using genetically engineered foods, there is no consumer demand for these products and the massive recall of Kraft products has already proven them to be a liability," said Michael Passoff of As You Sow Foundation. "Kraft shareholders have a right to know about the risks their investments exposed to, especially if these risks can be avoided."

The report notes that many U.S. food manufacturers have shifted away from biotech ingredients without any apparent financial difficulties, and says that Kraft has already removed biotech ingredients from its products in Europe. Europeans are adamantly opposed to biotech foods, opposition that has created trade conflict with the United States.

"These financial risks can be avoided and Kraft knows how to avoid them," stated Rebecca O'Malley, program director for ecopledge.com, an organization that organizes students, consumers, and investors to influence corporate social and environmental responsibility. "The company needs to finish the job and remove these ingredients from the rest of its products."
Stubborn weeds a threat to Roundup's revolution
Arkansas Democrat-Gazette
Sunday, April 20, 2003 [more on glyphosate resistance]

excerpt: Farmers, Ramey [Ramey, the Blytheville farmer] said, tend to live year to year... and follow what's working around them. If one farmer's neighbors and friends all use glyphosate and plant seeds designed to live with it, he's likely to follow. "We probably are creating a monster, long term," he said.

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