March 7, 2008

Japan faces higher costs for non-GM grains from US

Japanese traders are dealing with higher procurement costs for non-genetically modified grains such as soy and corn from the US as GM crop gets more popular.

US farmers are increasingly shifting to GM grains for animal feed and biofuels, leaving behind non-GM crops which require much more time and labor to produce.

GM crops are more preferred globally as they are more tolerant to pests and unfavourable weather.

However, Japanese consumers still feel strongly against GM crops for food consumption.

A shortage of non-GM grain in the US is predicted to cause food price hikes in Japan.

Currently in the US, GM crop acreage accounted for 91 percent of total production for soy and 73 percent for corn in 2007. The figures are predicted to rise further in 2008.

In a bid to stem the shift and encourage non-GM grain production, Japanese traders raised premium payments to US farmers, yet negotiations on non-GM crop procurement are becoming even more difficult, industry officials said.