Genetically modified organisms (GMOs) took center stage at a trade symposium held in Singapore this month, with more than 200 companies from dozens of countries represented in discussions about the future outlook of feed grain trade within the region.
After last year’s tumultuous trade interruptions with China, several speakers focused renewed attention on risk management in the global market.
Christopher Swart, partner at Singapore-based law firm Holman Fenwick Willan LLP, discussed the trade disruption with MIR 162 and its aftereffects. Swart noted the recent lowering of long-term U.S. Department of Agriculture (USDA) projections for Chinese corn imports from 22 million metric tons (866 million bushels) in the 2023/2024 marketing year to only 6.5 million tons (256 million bushels) and suggested that this is evidence that the risk associated with asynchronous biotech approvals will linger for quite some time.
The sudden interruption of U.S. corn and distiller’s dried grains with solubles (DDGS) exports to China produced opportunities for other buyers and, over the past year, Southeast Asia was a leading beneficiary. Vietnam emerged as a major destination for diverted corn, and it was a key purchaser in a buyers’ market as its corn imports reportedly doubled year-over-year despite domestic production increasing 25 percent. In the Philippines, imports of DDGS increased almost 90 percent year-over-year, with much of the increase a result of diverted cargoes.
Many traders also found themselves asking what the future will hold for GMOs in Southeast Asia. One speaker, Dr. Desianto Utomo, Indonesian Feedmillers Association secretary general and Charoen Pokphand Indonesia vice president, told participants his company is urging the Indonesian government to allow the cultivation of GMO varieties in order to boost domestic production.
But perhaps the most revealing of the comments came from Michael Jester, Peter Cremer managing director, when asked about the potential for non-GMO feed grains in the region: “Nobody cares.�
The comment didn’t come as a surprise to many in the audience. Despite being officially non-GMO, Ukraine corn and Indian soybean meal command no premium in the region—in fact, they are often perceived as poorer quality and are usually discounted. However, Ukraine is finding a welcoming buyer in China, despite not being priced competitively.
As a region, Southeast Asia has, for the most part, been willing to let science be the focus of food security policy, reaping great rewards as a result.
“If the Europe Union adopts the so-called ‘precautionary principle’ and the United States adopts the ‘pragmatic approach,’ then Southeast Asia could be classified as ‘precautionary pragmatists,’� said Kevin Roepke, U.S. Grains Council regional director of South and Southeast Asia.
“For GMO trait approvals, Vietnam is widely regarded as the model for developing countries. Simply put—if a trait has been approved for food and feed use in five OECD or G20 (Organization for Economic Co-operation and Development or Group of 20) countries, it’s approved for use in Vietnam. Additionally, the Food/Feed Safety Committee can also approve the trait if it deems there are no risks involved, but Vietnam leans heavily on the first option.�
This March, the Vietnamese Ministry of Natural Resources and Environment approved a new trait for commercial cultivation within Vietnam, in addition to last year’s action by the Vietnam Ministry of Agricultural and Rural Development to approve four corn traits for commercial planting.
Across the South China Sea, farmers in the Philippines have cultivated GMO corn for more than a decade. In 2014, some 831,000 hectares (2 million acres) of land were devoted to GM corn—roughly the size of Delaware. Today, about 30 percent of total corn acres are planted to GMO varieties, and a vast majority of that to stacked traits. Since GMO seeds were first introduced there, farmers have seen yields improve more than 50 percent.
The Council sees Southeast Asia’s strong potential for consumption of U.S. coarse grains and co-products. While the Council has been and still is working to address tariff, non-tariff and import regulation barriers to U.S. coarse grains and co-products to the region, biotechnology has yet to cause trade disruptions between the region and the United States.