Trade Barriers: Low Level Presence (LLP) and Asynchrony of GMO Approvals. Andrew Conner, US Grains Council - MAIZALL

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2 Trade Barriers: Low Level Presence (LLP) and Asynchrony of GMO Approvals Andrew Conner, US Grains Council - MAIZALL

3 Agenda 1.Global Adoption and Trade of GMO Commodities 2.Biotechnology Research Pipeline & Regulatory Approvals 3.Low-Level Presence (LLP) 4.Fungibility 5.Conclusions



6 GM Traits Improve Performance Under Stress Biotechnology offers protection against Corn Root Worm (CRW) Damage root systems increases the impact of abiotic stress, such as drought and high winds. Healthy root systems protect yields and mitigate the impacts of Corn Plant Roots: healthy root system on left, damage from CRW larvae feeding on right. Photo Credit: Jim Kalisch, Department of Entymology, University of Nebraska-Lincoln

7 Photo: University of Florida Corn Borer Entry Point on Ear

8 Mold Growth Caused by Insect Damage


10 Global Maize Exports by Origin, 2014/2015 Major Exporters 1. USA 2. Brazil 3. Ukraine 4. Argentina 27% 73% Sources: USDA PSD; ISAAA GM Cultivating Country Non-GM Cultivating Country

11 Global Maize Exports by Origin, 2014/ % Major Exporters 1. USA 2. Brazil 3. Ukraine 4. Argentina 12% 73% GM Cultivating Country Ukraine Sources: USDA PSD; ISAAA Non-GM Cultivating Country

12 Sources: USDA PSD; ISAAA Global Soybean Exports by Origin, 2014/2015 3% Major Exporters 1. Brazil 2. USA 3. Argentina 97% GM Cultivating Country Non-GM Cultivating Country

13 Industry Corn Biotechnology Portfolio* A Steady Pipeline of Events Providing innovative solutions to improve total factor productivity Agronomic Trait Quality Trait Seed Production Trait Lep/Coleop Protection DP 4114 (DuPont Pioneer) Roundup Hybridization System (RHS) Pre-Commercial Herbicide Tol. 2,4-D & FOP (Dow) Insect Protection (DuPont Pioneer) 3 rd Generation Below Ground Insect Control SmartStax PR O Late Development Drought Tolerance (Syngenta) Glyphosate Tolerance (Genective) Insect Protection (DuPont Pioneer) Nitrogen utilization (Dow) 2 nd Gen CRW (Syngenta) 3 rd Generation Above Ground Insect Control Lepidopteran Protection III (DuPont Pioneer) Drought Tol. (Dow) 3 rd Generation Herbicide Tolerance High Yield Corn (MON/BASF) 4 th Generation Below Ground Insect Control Multiple Mode Herbicide Tolerance (DuPont Pioneer) Roundup Hybridization System 2 Fungal Resistance (BASF) Early Development NXT Insect (Dow) Yield &Stress 3 (MON/BASF) Nitrogen Use Efficiency (DuPont Pioneer) Yield & Stress 2 (MON/BASF) Herbicide tolerance (Genective) Nitrogen Utilization (Genective) Drought Tolerance II (DuPont Pioneer) 4 th Generation Above Ground Insect Control Coleopteran Protection III (DuPont Pioneer) Novel Insect Traits (Syngenta) Increased Ethanol (Syngenta) 4 th Generation Herbicide Tolerance Novel Insect Traits (Genective) *Estimated commercialization pipeline of corn biotech events prepared by the U.S. Grains Council Commercialization dependent on many factors, including successful conclusion of regulatory process.

14 Soybean Industry Portfolio Quality/Food Agronomic Pipeline of biotech events and novel trait releases High Oleic / Low-Sat (Vistive Gold) High-Oleic (Plenish) (Du Pont Pioneer) Omega-3 Stearidonic Acid Enlist 2,4-D Tolerant (Dow) Low Raff- Stach (Virginia Tech) Enlist/RR2Y (Dow) Insect resistant (2 nd generation) Commercialized Commercializ ed Vistive Gold Xtend Increased oil & improved meal (Du Pont Herbicide Pioneer) Tolerant (3 rd generation) Asian rust control (Du Pont Pioneer) RR2Y LibertyLin k (LL) (Bayer) LibertyLink (LL) (Bayer) Bt/RR2Y Imidazolinon e tolerant Brazil only. (BASF/Embrapa Brazil) FG72 Glytol/HPPD (Bayer/MS Technologies) Dicamba tolerant IND00410 (stress tolerant) (INDEAR (Argentina) MGI tolerant (Syngenta/ Bayer) Glytol / HPPD / LL (Bayer/MS Technologies) Higher Yield II Drought resistant (Embrapa/ COODETEC) Insect resistant (sucking insects/stink bugs) Cyst nematod e resistanc e (BASF; Bayer; Monsanto; Disease Syngenta) resistanc e (Syngenta) Lepidopter a resistance (Du Pont Pioneer) Source: Pipeline information from industry & published sources: November

15 Regulatory Systems Are Not Keeping Pace With Innovation Source: CropLife International

16 Low Level Presence (LLP) LLP is defined as the unintentional, low level presence of an agricultural biotech product approved in one or more countries, but not yet approved in the importing country. GMO has undergone full safety assessment consistent with CODEX by a competent authority in one or more countries.

17 Insufficient LLP Policies Impacts Failure to proactively develop a transparent LLP policy could lead to: cancellation of contracts risk premiums and supply shortages for the country of import significant issues across the value chain from farmers to Recent consumers. Examples: China, the European Union, South Africa

18 Fungibility What is Fungibility: A good or asset's interchangeability with other individual goods/assets of the same type. Simplifies the exchange/trade process, as interchangeability assumes that everyone values all goods of that class as the same In the international movement of grain, fungibility refers to all grain in the system being basically the same. Example: No.2 yellow corn, it does not matter where the corn was grown - all corn designated as No.2 yellow is worth the same amount.

19 Fungibility Farmers have widely embraced growing a generic product, with clear specifications. For those who originate and handle grain fungibility has been a key attribute to enable efficient supply chains For both domestic and international customers these generic grains have enabled access to a safe, low cost and predictable food supply chain Goal of LLP solutions should be to ENABLE Fungibility; by removing zero tolerance requirement and not having to channel/test for LLP in grain shipments.

20 International Marketing Thresholds: ISO wheat standard: maximum tolerance for other cereals: 3% shriveled grain: 8% Codex Maize standard: Broken grains 6%; foreign matter 2%; disease kernels 0.5% NAFTA Trilateral arrangement for identification compliance with Biosafety Protocol article 18.2(a) 5% for GMOs (overall) contents in a non GMO cargo Canadian, U.S. and EU organic product regulations require 95% organic ingredients for organic certification.

21 Conclusion: The Role of Argentina and Brazil Biotechnology is a critical tool for farmers to sustainably intensify agricultural production. Preserving fungibility is critical to ensuring commodities can move from areas of surplus to areas of deficit efficiently. If status quo persists, we will see increasing cases of trade disruptions and greater production volatility as the climate changes. More synchronous approval systems and LLP policies would facilitate trade and allow farmers greater access to beneficial technologies. Argentina and Brazil are early adopters, developers, and exporters of GMO crops; we will continue to need their leadership on issues of trade and technology.