Special Feature newsletter article, April 2000
asked questions regarding the production of transgenic crops
The transgenic crop, also known as
genetically modified organism (GMO), debate has created many new issues for
production agriculture. Most are not unique to transgenic crops, they are
just the beginning of differentiated markets based on a wide range of new
Grain Quality Initiative has assembled this question/answer checklist to help
you with planting decisions. Look for more updates and information throughout
the 2000 season.
by Roger Ginder, retired extension economist,
email@example.com; and Robert Wisner,
heard that premiums are being offered for non-GMO grain, but no elevator in
my area offers one.
may not be offered in all areas. Premiums are most likely to be offered with
grain bound for export or processors who wish to certify non-GMO co-products
to foreign or domestic markets.
are getting premiums?
are not assured in any area, but currently areas near the river export terminals
and some processing plants are more likely to offer premiums.
Am I likely
to be able to market non-GMO crops directly from the field for a premium at
vary from buyer to buyer, but in most cases your best opportunity to find
markets for nonGMO crops is likely to be after harvest. Many elevators are
not currently set up to segregate crops by genetic origin at harvest.
be able to market GMO corn and soybeans without a discount?
At this time,
major grain exporters and processors have announced that they are currently
buying approved GMO hybrids and varieties in the cash market at no discount.
Most have announced that they will write forward contracts for future delivery
of biotech grain. These contracts are being offered for dates up to the end
of Calendar 2000. Some have stated that they will assist producers who deliver
unapproved GMO grain to move it into acceptable channels.
Since channeling programs for unapproved GMO hybrids may differ, it would
be helpful to ask how such assistance will occur.
mean that there will be no discount on 1999 or 2000 crop?
Grain can be sold for cash today or for future delivery if it is contracted.
Grain companies cannot guarantee that there will be no discounts in the future
unless a contract is written and risk management is possible.
grain companies and processors write contracts beyond 2000?
and hedging become very difficult beyond that point.
a marketing risk if I plant GMO corn and soybeans?
currently are not accessible with GMO grain-in particular, EC food markets
and food markets in some far-east markets. About 80 percent of corn utilization
and soy meal utilization are for feeding. These markets are currently accessible
to GMO grains in the U.S. and some export markets.
avoid risk by planting non-GMO seeds?
would carry reduced risk against market changes and new policies, however,
for nonGMO grain to be priced differently from GMO, it must usually be identity
preserved. This typically involves extra costs and management effort. Unless
a contract is written, there is no assurance that the producer will receive
a premium at all or (if he or she does receive a premium) that it will cover
any way to reduce the risk of planting nonGMO for a premium?
who think there is a possibility that premiums will be offered later in the
growing season can plant nonGMO seed, clean out the planter, and isolate the
field. These represent a small proportion of the costs associated with the
identity preservation of grain. If an opportunity presents itself over the
growing season, these producers will be in position to take advantage of it.
and testing may be required if I have a market for non-GMO crops?
may vary with the buyer. Be prepared for documentation of details on the seed
you planted, including variety, where obtained, where planted, and lot numbers,
and that you have taken at least normal care to clean bins and equipment.
Also, expect testing or sample retention for GMOs at the point of sale.
I handle the risk of cross-pollination from neighboring fields?
is mainly for corn, and is one that cannot be completely eliminated. You may
want to contact neighbors to find out what type of corn they will be planting
in fields bordering yours. Also, check with agronomists to determine how far
into your field there is a high risk of cross pollination, and plan to harvest
and feed or market this portion of the crop as GMO corn if it borders a GMO
If I have
a market for non-GMO corn or soybeans, will 1 have risks of getting a price
discount if one or more loads does not measure up to required standards?
vary from one buyer to another. In the Eastern Corn Belt last winter, some
buyers merely bought the disqualifying load at the GMO price, with no premium
and no penalty. At least one major buyer in that area reportedly had a sizable
penalty for each load that did not meet standards.
be important to let my grain buyer know if I have planted GMO corn varieties
that are not approved for export to the European Union?
become more important to do this in the year ahead. The EU is by far the largest
market for corn gluten products produced by the U.S. corn processing industry,
and processors will not want to risk losing that very important market. Prospects
for the EU to approve currently unapproved varieties look to be quite limited.
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