By Rog Wood
The European Union will have to speed up its authorisation processes
for the use of new genetically modified (GM) varieties of crops. That was
the hard-hitting message from David Caffall, chief executive of the
Agricultural Industries Confederation (AIC) at a dinner in Renfrew.
The AIC was formed four years ago and has 27 members in Scotland
representing 90% of the Scottish agricultural supply industry.

In July 2007, DG Agriculture at the European Commission issued a
report on the economic impact of unapproved genetically modified organisms
on EU feed imports and livestock production. It spelled out a worst-case
scenario, with feed prices rising by 600% in 2010 unless EU authorisations
are granted in major countries growing feed materials such as soya and
maize.

The EU is only 22% self-sufficient in vegetable protein, so it depends
heavily on imports derived from crops such as soya, maize gluten and
sunflower. Many of these crops are now grown with GM traits on a very large
scale.

The EU has traditionally imported between five million and six million
tonnes of US maize by-products per year. That was sharply reduced in 2006-07
because of zero tolerance of unapproved GM varieties. Contamination as small
as a few soybeans or grains of maize from unapproved GM varieties leads to
the rejection of an entire shipment.

The US 2007 maize crop cannot be imported because approximately 1.5%
of the crop planted was Agrisure RW and Yieldsguard VT, two GM varieties
that await EU authorisation. Cross-contamination can occur in lorries or
American grain stores, so shippers are not willing to take the risk of
importing for fear of cross-contamination.

Caffall explained: "Farmers outside the EU prefer to grow GM crops
because they have better yields or disease resistance. Some soybeans have
been bred for healthier traits including omega oils."

According to Caffall, farmers have been protected from the worst
effects of soaring feed prices this winter as a result of feed manufacturers
buying their raw materials on forward contracts. Apart from the issue of GM
varieties, there are also currency movements to take into account.

A 1% drop in the dollar equates to a 130p-per-tonne increase in the
price of soya. It was the same with the euro. The drop of four euro cents
last Thursday led to a 520p per tonne increase in the price of rape.

In January 2007, 100p bought 151 euro cents but by March this year
that had fallen to 127 cents, a currency movement that has increased the
price of rape by 1820p per tonne.

Fuel prices and haulage costs were also having an impact on the feed
trade. A 1p- per-litre rise in fuel costs equated to a 4p-per-tonne increase
in feed costs delivered. More dramatic were the increased costs of shipping
that had risen more than seven-fold since 2002 as a result of strong demand
by China.

The stark overall message was that, ultimately, consumers were going
to have to bear the brunt of all these increased costs at the check-out
tills.


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