GE - paying more for less

Genetically engineered food: it has to be one of the most confounding issues in contemporary Australian politics. While there are plenty of reasons to package and brand GE concerns as an environmental or moral issue, independent evidence also shows that GE foods fail to deliver financially. That's the main reason it is so difficult to grasp why economic conservatives on both sides of federal politics continue to push GE foods. 
 
Federal Agriculture Minister, Tony Burke, has offered his unqualified support for GE foods, telling Australians that they better get used to eating it, because it is the solution to world hunger. "I don't see how anyone can mount a moral argument against genetically modified food when we're facing these sorts of projections on global hunger," said Burke in October this year.
 
I would agree with the Minister, the strongest arguments against GE foods isn't a moral argument, it's a financial one. Australia's domestic and export markets have rejected GE food. This has led to major grain handlers refusing to transport it and leading food corporations refusing to buy it.  Add to this the losses that farmers face when they fail to see guaranteed yield increases they have relied on to cover the increased input costs associated with GE, and it becomes clear that GE food is far from a sound financial investment.
 
Greenpeace has just launched its Truefood Guide for 2010. The guide lists which foods in Australia do and don't contain GE ingredients, making up for the fact that our lax food labelling laws leave consumers completely in the dark on GE.
 
Executive Chef of award-winning Sydney restaurant Longrain, Martin Boetz and food industry icon Margaret Fulton launched the 2010 Guide. They were able to announce that for the first time corporate giants Nestle, Fosters, Schweppes and Lindt have agreed not to use GE-ingredients in any of their Australian brands.
 
These food and beverage multinationals join the majority of Australian food industry companies, with Coles, Goodman Fielder, Sanitarium, Heinz, Arnotts, Coca-Cola and IGA all signed to the Green column of Greenpeace's Truefood Guide.
 
The success of the Truefood Guide highlights one of the main reasons why GE is a bad investment for Australia – there is no demand. Opinion polls show that the majority of consumers don't want to eat GE food and 90% want it properly labeled so they have a choice whether to eat it or not. And there are overwhelmingly good reasons not to eat GE food. Peer-reviewed animal feeding studies show that rats fed GE canola displayed side-affects including a 16% increase in liver size, stomach lesions and immune deficiencies. Hungry anyone?
 
In countries where people do know they could be eating GE food, because of better labeling, they tend to avoid it, which brings us to the second key reason why GE food is a bad investment for Australia.
 
The EU has a ban on growing GE crops and stringent food labelling laws that have lead to widespread, ongoing consumer rejection of GE food. Japan already has mandatory labelling of some GE food and its new government has pledged to introduce a food traceability system, with new labelling laws expected to extend to processed foods such as canola oil. The decision reflects consumer distrust of GE foods in Japan; in 2007 a group representing 2.9 million Japanese consumers traveled to Australia, urging state government's to extend their GE crop bans so Australia can continue to supply non-GE canola to world markets.
 
Export market rejection of GE crops has serious implications for Australian agriculture. In October this year, two of Australia's major bulk handlers announced that they will not be trading GE canola this season. Cooperative Bulk Handlers (CBH) and Elders will not buy GE canola this year in NSW or Victoria, citing domestic consumer rejection and the threat GE crops pose to key export markets in the EU and Japan as the key reason for the decision.
 
According to Elders grain trader Felix Mueller, “For export, GM is not workable. You won't get it into Europe and I don't think the Japanese are particularly keen on it.” Elders will be reviewing their company policy on GE crops this year.
 
With consumer rejection in domestic and export markets, leading to grain handler rejection and food industry refusal to use GE-ingredients, one has to ask who is benefiting financially from planting GE crops. Is it helping farmers? An objective analysis of farm-scale economics leads to a clear and resounding "no" to this question.
 
The key argument multinational petrochemical companies like Monsanto use to market GE seeds and the increased amount of pesticide that goes with them is that Roundup Ready Canola increases yields. For a farmer struggling with drought and the decreasing share of profits returned to farmers in large-scale corporate agriculture, the promise of assistive technology to increase output is understandably appealing.
 
The unfortunate and appalling fact is, however, that there is absolutely no evidence that GE canola increases yields. In fact, all independent, systematic evidence points to the contrary. In 2008, as part of the World Bank International Assessment of Agricultural Science and Technology, 400 leading scientists found no evidence that GE crops increase yields .  They concluded that GE is not a solution to world hunger, and in fact, the patents associated with GE crops pose a financial problem to farmers, because they prevent them from saving seed. This is a particular problem for farmers in the developing world.
 
Independent Australian studies confirm these findings. In January this year, the Grains Research and Development Corporation (GRDC) announced the results of the first independent trials of GE canola in Australia. The trials found that GE canola yielded 17% less than both traits of non-GE herbicide-tolerant canola it was trailed against.
 
The 2008 costs for planting GE canola included a half-price stewardship fee of $500 per farm, a discounted $10.20/tonne royalty fee and an extra $43.50 per hectare for GE seed. That's a 15% increase in costs for GE canola, requiring at least a 15% increase in yields to cover costs. Instead, GE canola rewarded farmers for this 15% increase in input costs with a 17% decrease in output. Add to this that Monsanto Roundup Ready canola comes as a package with Monsanto's Roundup Ready pesticide, and pesticide prices have doubled or tripled over the past two years, only easing off from record highs with the global financial crisis, and the ongoing economic viability of GE crops becomes clear.
 
To sum up, GE canola offers no financial benefits to farmers; it is rejected by domestic and export markets; and the majority of Australian food corporations are removing GE-ingredients from their supply chains. This makes the unqualified support for GE coming from both sides of federal politics look like a half-baked neo-liberal solution to the real problems faced by Australian farmers.
 
The reason politicians support GE foods is that they don't want to appear anti-technology; when rural Australia is struggling, Minister Burke wants farmers to know he is doing all he can to invest in agricultural innovation. It is infuriating that GE, buoyed by the billions spent on PR work by agrochemical companies worldwide, has been positioned as the only technological innovation currently available to Australian farmers.

This public relations effort has been so successful, that anyone opposed to GE food is  accused of being anti-technology. This is far from the truth. Marker Assisted Selection (MAS), a form of gene research which identifies the cells in plants that increase their resilience, is the gene technology making the real advances in plant breeding to increase salt and drought tolerance. There are currently no drought resistant GE crops on the market. And independent research shows that the best non-GE plants perform better than GE plants on both weed and pest tolerance.  

By accepting petrochemical corporations' PR push and tied-R&D dollars, rather than supporting economically viable technologies, politicians like Tony Burke and Western Australia's Terry Redman are selling out struggling farmers that will pay more for GE; export markets that are demanding non-GE food; food corporations in the process of removing GE ingredients from their supply chain; and domestic consumers, who will be the unsuspecting participants in the unmonitored testing of GE food among human consumers.
 
Notes:
 [1] The UN-World Bank International Assessment of Agricultural Science and Technology. See Poulter, S (2008) GM foods “not the answer” to the world's food shortage crisis, report says. .
 [2] ;