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NEWS FROM THE WORLDWATCH INSTITUTE
BIOTECHNOLOGY
SPECIAL
NEW! Audio Files on the Worldwatch Web Site for the First Time!
Worldwatch is pleased to bring you the complete audio
recording of an important
briefing on agricultural biotechnology. This
event is the first briefing that
Worldwatch has made available in audio
form on our website. The quality of
debate among the panelists was very
high, and we hope that you enjoy being able
to share this special event
with us through these Real Audio files. Please let
us know if you would
like for us to make audio files of future briefings
available on the web
site.
Contents:
1. Worldwatch Briefing on Agricultural
Biotechnology
2. Worldwatch News Brief 2000-01, "Portrait of an Industry in
Trouble" by Brian
Halweil, an overview of the current state of the
agricultural biotechnology
industry.
3. Download a free copy of "The
Emperor's New Crops," an article on genetically
engineered crops, from
World Watch magazine.
1. The Worldwatch Briefing on Agricultural Biotechnology
On February 17, the Worldwatch Institute and the Consumer's
Choice Council
sponsored a briefing on agricultural biotechnology with a
distinguished group of
panelists. You can listen to this briefing by going
to our special Biotechnology
Forum page (www.worldwatch.org/biotech), where
the presentations and the
question-and-answer session are available as Real
Audio files.
The panelists presented a wide range of opinions on this
controversial subject.
Each panelist made a short presentation, followed by
a spirited hour-long Q&A
session during which panelists and audience
members explored some of the
critical issues in the development of this
technology.
Agricultural biotechnology faces an uncertain future. Public
resistance is
spreading from Europe around the world. And some 130 nations
just signed an
international biosafety agreement prescribing caution. World
area planted with
genetically engineered seeds is projected to drop by as
much as 25 percent in
2000. At the same time, share prices for agricultural
biotech companies are
falling, exports of transgenic crops are tumbling,
and uncertainty is mounting
for farmers. Many observers are concerned that
the rollout of transgenic crops
is proceeding too rapidly given the limited
scientific data and government
regulation.
The panelists were:
David Sandalow, Assistant Secretary of State for Oceans and
International
Environmental and Scientific Affairs, U.S. State Department
Robert Horsch, Co-President of Sustainable Development
Sector, Monsanto Company
Per Pinstrup-Andersen, Director General, International Food
Policy Research
Institute
Margaret Mellon, Director of Sustainable Agriculture and
Biotechnology Program,
Union of Concerned Scientists
Miguel Altieri, Professor of Agroecology, UC Berkeley
Robin Grove-White, Professor of Environment and Society,
Director, Centre for
Study of Environmental Change, University of Lancaster
Gary Goldberg, Chief Executive Officer, American Corn
Growers Association
Brian Halweil, Staff Researcher, Worldwatch Institute
2. Worldwatch New Brief 2000-01, "Portrait of an Industry in
Trouble" by Brian Halweil.
(NOTE: to view the figures, please go to the Worldwatch web
page
www.worldwatch.org/alerts/000217.html )
PORTRAIT OF AN INDUSTRY IN TROUBLE
by Brian Halweil
After four years of stupendous growth,
farmers are expected to reduce their
planting of genetically engineered
seeds by as much as 25 percent in 2000, as
spreading public resistance
staggers the once high-flying biotech industry. (See
Figure 1.) Stock
prices for agricultural biotech companies are falling, exports
of
transgenic crops are tumbling, and questions are mounting about the liability
for what is turning into a major debacle for farmers. At the same time,
some 130
nations just signed an international biosafety agreement
prescribing caution.
Worldwide, the area planted to transgenic crops jumped more
than twenty-fold in
the last four seasons, from 2 million hectares in 1996
to nearly 40 million
hectares in 1999. In the United States, Argentina, and
Canada, over half the
acreage for major commodities like soybeans, corn,
and canola are planted in
transgenics. (These three nations account for 99
percent of the global
transgenic acreage, pointing to the limited global
acceptance.)
But with a growing number of food manufacturers and grocery
chains in Europe
taking products containing transgenics off the shelves,
the market for these
crops has been shrinking. American exports of soybeans
to the European Union
plummeted from 11 million tons in 1998 to 6 million
tons last year, while
American corn shipped to Europe dropped from 2
million tons in 1998 to 137,000
tons last year: a combined loss of nearly
one billion dollars in sales for
American agriculture.
Investors have reacted harshly to the growing consumer
rejection of transgenics
and the resulting reduced sales of engineered seed
and complementary
agrochemicals. In May of 1999, Europe's largest bank,
Deutsche Bank, recommended
that investors sell all holdings in companies
involved in genetic engineering,
declaring that "GMO's [Genetically
Modified Organisms] Are Dead." The bank's
report envisioned the development
of a two-tiered commodity market in which
non-transgenic crops would
command price premiums over transgenic crops-a
prospect that threatens the
farmers planting engineered seeds and the companies
that sell these seeds.
In fact, top commodity handlers, such as Archer Daniels
Midland and A.E. Staley,
have already begun to discount transgenic crops
because of this greater
financial risk. Commodity traders have followed
suit fearing the loss of export
markets as Japan, South Korea, Australia,
Mexico, the members of the European
Union, and other nations draft laws
requiring mandatory labeling of food
products containing transgenic
ingredients.
Most major food companies have already announced that they
will avoid transgenic
ingredients in their products for the European
market. But now recent surveys
indicate that consumer tastes are souring on
the other side of the Atlantic as
well. Several food manufacturers,
including Gerber, Frito-Lay, and natural food
retailers Wild Oats and Whole
Foods, have said that they will avoid transgenic
ingredients in their
products sold in the United States-the largest consumer
market for
transgenic crops. If more American manufacturers hop on the
bandwagon, the
drop in demand would be devastating for transgenic growers and
seed
producers.
Share prices for biotech seed companies that were Wall
Street's darlings a few
years ago are sinking towards all-time lows.
Investors in Monsanto Company, the
industry leader which has born the brunt
of public criticism, have watched the
corporation's share price lose nearly
one-third of its value in the last year,
falling from a high of $50 in
February of 1999 to a recent low of just $35. (See
Figure 2.)
Brokerage houses have been advising major players in the
biotech industry to
spin off their ailing agricultural divisions. Novartis
and AstraZeneca both
followed this advice in December of 1999. Dupont had
been considering issuing a
new stock that would track its much-celebrated
and nascent ag biotech division,
but decided in early 2000 to indefinitely
postpone the stock's release. And
struggling to recoup nearly $8 billion in
seed company and agricultural
biotechnology investments, Monsanto merged
with pharmaceutical and chemical
giant Pharmacia Upjohn at the end of 1999.
The new firm quickly decided to turn
Monsanto's agricultural unit into a
separate company.
Further complicating the financial picture are concerns
about uninsured
liabilities for farmers and agribusiness companies. In
November 1999, 30 farm
groups, including the National Family Farm Coalition
and the American Corn
Growers Association, warned American farmers that
"inadequate testing of
gene-altered seeds could make farmers vulnerable to
'massive liability' from
damage caused by genetic drift-the spreading of
biologically modified
pollens-and other environmental effects." In
December, a group of high-profile
lawyers filed a class-action lawsuit
against Monsanto, on behalf of American soy
farmers, charging that the
company has not conducted adequate safety testing of
engineered crops prior
to release and that the company has tried to monopolize
the American seed
industry.
To many observers, the rapid release of transgenic crops and
the ensuing
financial disarray is disturbingly reminiscent of the earlier
uncritical
bandwagons for nuclear energy and chemical pollutants like DDT.
A combination of
public opposition and financial liability eventually
forced retrenchment of
these earlier technologies, after their effects on
the environment and human
health proved to be far more complex, diffuse,
and lingering than the promises
that accompanied their rapid
commercialization.
In an effort to avoid this same dismal cycle with the
introduction of each new
"revolutionary" technology, public policy
advocates have called for the adoption
of the precautionary principle.
Under current policy, a technology is all too
often judged safe until it is
definitively proven harmful. The precautionary
principle holds that when a
new technology carries suspected harm, scientific
uncertainty of the scope
and scale of the harm should not necessarily prevent
precautionary action.
Instead of requiring critics to prove that the technology
poses potential
dangers, the producers of a technology shoulder the burden of
presenting
evidence that the technology is safe.
Industry has long labeled the precautionary approach as
reactionary, arguing
that it stifles research and prevents economic
progress. On the contrary,
advocates realize that all
stakeholders-including consumers, government, and
industry-benefit from an
open and democratic attempt to anticipate any
undesirable social and
financial surprises. The goal is to apply wisdom and
judgement about the
potential effects of a new technology before flooding the
marketplace with
the products of that technology.
The rapid rollout of genetically engineered crops over the
last four years
stands the precautionary principle on its head. Widespread
commercialization of
transgenic crops has come before-not after-any
thorough examination of the
benefits and risks associated with these crops.
The regulatory framework devoted
to transgenics is inadequate,
nontransparent, or completely absent. And there
has been essentially no
public discussion about the many potential consequences
of large-scale
planting of transgenic crops. For example, U.S. Secretary of
Agriculture
Dan Glickman only recently called for studies assessing the
long-term
ecological effects of these crops. But more than half of the U.S.
soybean
crop and nearly as much of the corn crop are already genetically
engineered.
Another recent illustration of our lack of precaution was
presented in a
December 1999 article in Nature reporting that the
insecticide produced by a
widely planted variety of transgenic corn can
accumulate-in its active form-in
the soil for extended periods of time. The
authors note that the effects on soil
organisms and soil fertility are
largely unknown, but potentially enormous. But,
like earlier laboratory
studies showing that pollen from this same corn could be
lethal to certain
beneficial insects, the fact that such effects had not been
considered
prior to planting tens of millions of hectares in this crop raises
concerns
about the adequacy of existing safeguards for ecological and human
health
risks.
-END-
Brian Halweil is a Staff Researcher with the Worldwatch
Institute, a Washington,
DC-based research organization.
3. For a longer article on genetically engineered crops, you
can download Brian
Halweil's "The Emperor's New Crops," from the
July/August 1999 issue of World
Watch magazine. This article is available
for free on the Worldwatch web site if
you register on the web site. (http://www.worldwatch.org/register/reg.html
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