March 15, 2016

US farmers opting for conventional crops as GM plantings stagnate 

Genetically modified (GM) crop plantings in the US seems to have realised its zenith after recording 94% for its share in soybean cultivations in 2015/16, a similar percentage from a year earlier, the Nikkei Asian Review reported.

However, the GM percentage for corn declined to 92% from a previous 93%. Meanwhile, farmers, especially soybean planters, are compelled to plant more conventional varieties due to special premiums which have become "more appealing amid a soft crop market," said a representative for general trading house, Kanematsu.

Other than the more time-consuming and labour-intensive process of planting and harvesting involved, non-GM products in the Chicago commodities market can qualify for premiums which have increased in recent times. Premiums for North American soybeans are usually in the mid-US$2 level per bushel, four times the level from a decade ago.

The potential rise in demand for non-GM products could also be another factor for the switch. These interests are reflected in Mitsui & Co.'s acquisition of a 50% stake in a US grain handler that deals mainly with non-GM food. Mitsui expected the market for such to grow 5% to 10% yearly, according to Nikkei.

Closer to the heart of the US sector, ADM revealed in February that it would invest in Harvest Innovations which produces foods from non-GM soybeans.

Japan's National Federation of Agricultural Cooperative Associations, or Zen-Noh, has also partnered with a US seed company to provide American farmers the most advanced non-GM seeds.

However, sourcing from non-GM plantings remains a challenge, said Junji Torigoe, president of Sagamiya Foods.

Only a few farmers have ditched GM cultivations while associated premiums remain high.

- Nikkei