USA missing the main markets

October 2018

America has been gung-ho about declaring gene-edited plants somehow not really GM, paving the way for the new-GM crops now lining up for entry to the US food market [1,2].

The back-drop to this is interesting.

Incomes for American farmers have been trending downwards for some time. Indeed, the US Department of Agriculture (USDA) forecasts 2018 will see a decline in net farm incomes to the lowest level in twelve years. All those vast areas of GM commodity crops they've been growing for the past two decades don't seem to be benefiting their bottom line.

From the consumers' perspective, the growth market is in sustainable origin-tracked food, organic produce, and non-GM fed livestock. Indeed: 

"According to market research firm Euromonitor, sales of GMO-free products in America are expected to hit $19.2 billion in 2022 compared with $15.7 billion in 2016, while worldwide sales are expected to rise to $37.6 billion from $31.1 billion during that same period." (Berr)

Biotech soya is missing out on lucrative export markets. For example, Japan, a major user of soya for tofu and other soya products, will pay significant premiums for non-GM beans and two- to three-times GM prices for organic beans.

Demand for organic in the US has been steadily increasing, so much so that it's importing more organic corn than its farmers are producing.

To align supply to demand, thousands of US farms need to transition to organic, but there are major obstacles. First a reversal of the American mindset that 'big' is 'more profitable': small farms can convert to organic more easily and can operate organic systems more efficiently. Second, organic seed is in short supply, and third, the infrastructure for access to organic markets is undeveloped.

America also needs to tighten up its regulation of organic and non-GM cheats. These markets are lucrative. It's proving all too easy to sell imported 'organic' produce which has been sprayed with pesticides at the port of entry just like conventional imports. Nestlé is being taken to court for putting its own 'No-GMO Ingredients' logo on its products, allegedly aiming to mimic a respected non-GM certification scheme when in fact the claim and the logo are simply its own. The Company's idea of 'no-GMO' ingredients doesn't extend to dairy: it's happy to use milk products from cows fed GM feed.

OUR COMMENT

Just a few things to watch out for post Brexit seem to include: US-sourced unlabelled products which are really GM or gene-edited, organics which aren't really organic, and 'non-GMO' labels on products which aren't really non-GMO.

Background

[1] GMOs ARE NOT GMOs IN AMERICA - September 2018

[2] NEW-GM WHEAT WITH FIBRE - October 2018

SOURCES:

• Anna Casey, In High Demand, Organic Soy and Corn Farmers Stand to Win, Civil Eats, 1.06.18
• Rei Geyssens, Global non-GM soybean demand to rise, driven by EU: Rabobank, Agricensus, 11.04.18
• Jonathan Berr, Nestlé misled consumers about GMOs in its food products, lawsuit alleges, CBS News, 2.08 18
• Nestlé's 'No GMO Ingredients' Seal of Approval Is Fraudulent, Class Action Lawsuit Claims, www.classaction.org/blog, 30.06.18