StarLinkTm : 3/6/01

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StarLinkTm 3/6/01
Source Kan Ham, ISU Agronomy Dept.

• By Dr. Robert Wisner
• University Professor of Economics
• Iowa State University

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StarLinktm--Crisis in the CornMarket?

• U.S. Corn Exports outstanding export Sales,
  3/01/01
• Japan -17
• South Korea -43
• Taiwan 1
• Africa -4
• W. Hemisphere 5
• All destinations -10
• Pre-StarLink Proj. 13 to 17

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Normal Shares of U.S. Corn Exports

• Japan 31
• S. Korea 13
• Taiwan 9
• 3-mkt. Total 53

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Starlink, Cont.

• EPA in October approved Starlink exports for
  feed, if segregated from other corn
• Not approved for export for food anywhere, or for
  feed in Japan
• Nov. EPA outside panel reviewed new Aventis
  data for possible acceptance as food
• Cry9C protein was found in blood stream of Norway
  rats, with immunologic response
• Medical panelists some persons may have
  experienced allergenic reactions from Cry9C

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Industry/USDA Efforts to Deal With the Problem

• Food feed export certification programs
• Sampling problem Japan Korea finding StarLink
• Avg. contamination fraction of a
• The future Problem for at least another year
  problem (co-mingled stocks)
• Possible 400-700 (000) units of contaminated
  non-StarLink seed for 2001 (USDA to buy this
  from small companies)

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StarLinktm or Cry9C Cont.

• Was Grown in 1999 2000
• Center for Disease Control testing alergenic
  reactions from StarLink
• Japan testing StarLink for possible feed approval
• Farmers Important to control volunteer StarLink
  in StarLink neighboring fields
• Need to clean planters

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Corn Refiners Assoc. Release 10/9/00

• Ethanol is produced by CRA members in same
  facilities with food production
• StarLinktm in their facilities violates U.S.
  govt. registration for the product
• Also, gluten goes to export markets
• Limited number of dry-milling plants may use
  StarLinktm for ethanol, where by-products are
  only for feed

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EPA Announcement 3/7/01

• Wet Milling Eliminates (or nearly eliminates)
  Starlink Protein
• Immediate change in processor acceptance of
  Starlink of food approval not expected

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Elevator Price Impacts (Varies over Time)

• Jan. 12, 01 example, N. Iowa if rejected _at_ ADM,
  next market is feed exports
• Non-Starlink bid to elevator -0.36 March
• StarLink bid-0.50 March if open river could be
  found
• Earlier, poultry mkt in Arkansas was ok, but
  saturated in January
• Local feed mill best outlet if enough demand
• Source Dr. Marty McVey, Agri-Industries, Des
  Moines, IA 1/12/01

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0.5 of U.S. crop, 1.1 in Ia (Highest co. 9.1)
20,000 to 99,999
0.6 in Minn., 0.5 in Nebr., 0.6 in KS.
100,000 to 1,000,000
None reported
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The Future?

• EU-unapproved varieties another StarLinktm
  waiting to happen?
• ADM and Staley caution farmers plant only
  varieties approved world/wide
• At stake the EU gluten mkt. (About 60 of
  output)
• Some companies plan to target sales to livestock
  areas (Similar strategy to StarLink)

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Illinois Dept. of Agriculture Land Stewardship

• For 2001, requests that seed companies sell only
  varieties approved for all markets world-wide
• So far, no similar response from other states

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Future Implications, Cont.

• StarLink acres, of U.S. 2000 corn crop
  Approximately 0.5
• of U.S. corn acres with varieties not approved
  world-wide in 2000 7.0
• Channels at Risk Wet-millers, Exports to EU
• Can we channel it keep it separate?
  Co-mingling, cross pollination, marketing?

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EU Unapproved Corn Varieties

• Markets at risk
• Wet millers Approximately 18 of total demand
  for U.S. corn (StarLink affected 30-38 of
  demand)
• European Union 1-2 million bushels (starting to
  recover a little)
• Asian market acceptance, so far not a problem
• S. Korea began GMO labeling March 1, 2001
• Japan starts labeling April 1, 2001

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EU Super Markets Going 100 Non-GMO Livestock
Products

• Tesco (Late 2001)
• Asda (Late 2001)
• Iceland (Already doing it)
• Marks Spencer (Already doing it)
• Safeway (No date)
• Sainsbury (No date)
• Summerfield (No Commitment on GMO -free meat)
• Fast food Mc Donalds, Burger King

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Source National Corn Growers Assn.
Products Not Approved for EU

Pioneer YieldGuard/LibertyLink no sales for 2001
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New Foreign GMO Regulations

• EU could bring expanded GMO approvals, but will
  take time, requires major testing
• EU is expected to provide for traceability
  (Consumer Demand)
• UN panel Encourages labeling

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Future GMO Developments

• Countries adding GMO labeling
• Japan April 2001
• S. Korea March 2001
• Those without specific dates
• Philippines
• Australia
• New Zealand
• Thailand
• Malaysia
• 2000 Global Biosafety Protocol Treaty to
  encourage labeling