AgrEvo Seeks to Sell Liberty Link Soybeans Despite European Ban
Bloomberg News
February 2, 1999, 5:03 p.m. ET
AgrEvo Seeks to Sell Liberty Link Soybeans Despite European Ban
Frankfurt, Feb. 2 (Bloomberg) -- AgrEvo GmbH, the
agricultural joint venture of German chemical companies Hoechst
AG and Schering AG, wants U.S. farmers to plant its Liberty Link
soybean seed, even though they won't be able to export the crop
to Europe because it hasn't been approved there yet.
AgrEvo said it's negotiating with the American Soybean
Association to set up a ''closed loop'' system of production
that would ensure the soybeans don't get into European export
channels. It would contract with certain farmers and elevators to
keep the seed separate.
It takes at least double the time to get genetically
modified seed approved in Europe as it takes in the U.S., where
the process typically lasts a year. Europe has approved just five
varieties compared to 30 in the U.S.
The delay means AgrEvo is forced to restrict sales of
Liberty Link soybeans for the second straight year. That's left
the field open for rival Monsanto Co. and its competing Roundup
Ready seed. Both products allow farmers to spray herbicides over
their soybeans, killing weeds without damaging the crop.
Roundup Ready soybeans were approved by the European Union
in May 1996, clearing the way for U.S. farmers to plant the crop
for export markets. In 1998 more than 25 million acres, or 35
percent of all U.S. soybean acres were Roundup-resistant.
Analysts say that could rise to as much as 45 million acres, or
63 percent in 1999.
''The difficulty AgrEvo will have in 2000 is in penetrating
the substantial acreage that Roundup Ready has claimed,'' said
Christine McCracken, an analyst at Vector Securities
International.
AgrEvo is negotiating with the American Soybean Association,
which represents 32,000 growers about the terms of setting up a
closed loop system, and the amount growers would be compensated
for keeping the beans segregated.
Even if terms are agreed, AgrEvo said the system could only
be applied to a small number of acres. It would be prohibitively
expensive for AgrEvo to contract with farmers for millions of
acres. Still, the company wants its product at least to be on the
market, even if in a limited way.
--Toni Clarke in the Chicago newsroom (312) 692-3725 /mfr
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