Viptera corn being rejected by grain buyers

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China has thrown a huge problem at U.S. corn exports and farmer customers who planted Agrisure Viptera corn this year from Syngenta’s family of brands. At least two grain companies, Bunge and Consolidated (CGB), that have the expectation of shipping corn to China have announced they will not accept delivery of Viptera corn with the MIR162 insecticidal trait because China has not approved import of the grain.

Of course, the lack of China’s export approval has caught farmers in the middle of regulatory chaos, and caused Syngenta seed customers to lose confidence in the company. Most of the limited number of seed customers aware of the problem last week were definitely upset.   

The independent seed salesmen and ag retailers who sold Syngenta Viptera seed to their customers this spring are naturally upset, too, and those contacted said they were not forewarned of the grain companies’ planned rejection of the grain.

Independent seed salesmen reported finding out about Bunge and Consolidated’s plans to reject Viptera grain, and testing for the insecticidal trait upon delivery to grain terminals, from local grain elevators doing business with the grain buyers. Reports were that telephone calls to seed representatives of Syngenta brands were not being returned as of the end of last week.

Within the grain industry, the problem wasn’t completely unexpected as the topic had come up in previous industry meetings. Finally in July, Syngenta’s management met with National Grain and Feed Association (NGFA) and North American Export Grain Association (NAEGA) representatives to explain that the Chinese government’s regulatory review of the new biotech corn trait would most likely not occur until the end of the first quarter of 2012.

Syngenta received U.S. regulatory approval for selling Agrisure Viptera corn seed in April 2010 and proceeded to secure approvals for growing the corn in Canada, Argentina and Brazil. Import approval was received from Australia, Brazil, Canada, Japan, Mexico, New Zealand, the Philippines, South Korea and Taiwan. Confusion seemed to occur in whether import approval would be needed for China and the approval timeline after Syngenta submitted registration documents in March 2010. China reportedly requires a recognized second country’s regulatory approval before it will begin its approval process. China accepted Brazil’s approval in this case.

According to the NGFA, estimates are that approximately 250 million bushels of corn containing the Agrisure Viptera trait could be produced this year with a majority of the seed planted in Iowa, Illinois, Indiana and Nebraska. Some of the corn was planted in several other states, which are not the biggest corn production states, including Mid-South states. The insecticide trait has proven to be effective against a wide number of corn pests, outperforming competitive traits, which accounts for its quick adoption by growers who had seen company and third-party field plots.

Any loads of grain with even minimal contamination will be rejected. There is potential for pollen drift across property lines, which means even if a farmer did not plant Agrisure Viptera hybrids and a neighbor did, harvested corn could still test positive for the trait and the corn would be rejected. China is reportedly known to have a near zero tolerance for contamination from non-approved traits in imported grain.

No official statements from the management of Bunge or CGB was found in a search about the situation, but there was no doubt about the companies’ plans to reject the grain because signs have been posted at their grain facilities. But a NGFA spokesman, Randy Gordon, was quoted as saying he doesn’t think that the two grain marketing giants will be the only companies not accepting Viptera grain.

The lack of customer communication is expected to be resolved this week per a Syngenta spokesman. Paul Minehart, head of Syngenta corporate communications in the U.S., was quoted by Kurt Lawton with DTN/The Progressive Farmer as saying, “We’re in the process of developing customer communications to ensure that growers are kept apprised of what’s going on. The key thing right now is for growers to contact their usual grain handlers. Many of them are going to accept Viptera.”

Complicating delivery of Viptera corn to ethanol facilities is the possible export of dried distillers’ grains to China; these DDGs would also be rejected per early reports from grain industry officials.

Finding buyers for the Viptera grain is the main concern at this point. Storage of the grain until China gives approval might be a partial solution, but some of the best farmers have pre-sold grain for delivery per a forward contract. Without a grain buyer, corn growers won’t be able to fulfill contracts.

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