Cargill sues Syngenta over rejected shipments to China

by Jeff Gelski
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EDGARD, LA. — Cargill filed a lawsuit on Sept. 12 in a Louisiana state court against Syngenta Seeds, Inc., claiming Syngenta’s commercialization of a corn seed containing a genetic trait led to China rejecting shipments of U.S. corn. The rejections led to damages to Cargill of more than $90 million, Cargill said in the lawsuit, which requests a trial by jury.

Syngenta commercialized Agrisure Viptera in the fall of 2010 before obtaining import approval from China, according to the lawsuit. Agrisure Viptera contains MIR 162, a genetic trait that controls insect damage.

“Syngenta also understood that through the sustained and widespread commercialization of Viptera, the corn crops grown from this seed would be intermixed into the U.S. corn supply in such a way that it would be practically impossible for exporters of U.S. corn to satisfy China’s zero-tolerance requirements,” said the Cargill lawsuit filed in the 40th Judicial District Court for the Parish of St. John the Baptist in Edgard.

Syngenta said the lawsuit was without merit and that growers have the right to have access to approved new technologies.

“The Agrisure Viptera trait (MIR 162) was approved for cultivation in the U.S. in 2010,” Syngenta said. “Syngenta commercialized the trait in full compliance with regulatory and legal requirements. Syngenta also obtained import approval from major corn importing countries. Syngenta has been fully transparent in commercializing the trait over the last four years. During this time Agrisure Viptera has demonstrated major benefits for growers, preventing significant yield and grain quality losses resulting from damage by a broad spectrum of lepidopteran pests.”

Cargill’s lawsuit said that because of the interdependence and interconnectedness of the modern agricultural industry, a shared responsibility exists among industry participants to exercise reasonable care when commercializing, releasing and selling new biotechnology.

“Syngenta ignored this shared responsibility by releasing a new genetically modified seed into the U.S. corn supply, knowing (a) that its product had not been approved in China, a key export market for U.S. corn, and (b) that its actions would likely close this key market,” Cargill said in the lawsuit. “Syngenta continues to ignore this shared responsibility by continuing to market and sell this product, even after its actions led to the effective closure of the Chinese market for corn grown by U.S. farmers.”

Since November 2013, China’s Ministry of Agriculture has rejected more than 1.4 million tonnes of corn grown in the United States, according to the lawsuit.

The National Grain and Feed Association, Washington, in April estimated U.S. corn, distillers, grains and soy sectors have sustained up to $2.9 billion in economic losses because of rejected U.S. corn shipments to China related to Agrisure Viptera. The N.G.F.A estimated the losses could be up to $3.4 billion during the 2014-15 marketing year because of Syngenta’s decision to launch seed sales of its new Viptera Duracade 5307 biotech-enhanced corn before approval in export markets, including China.

Cargill, based in Minneapolis, gave reasons for filing its lawsuit in the state of Louisiana. Cargill’s Reserve and Westwego facilities in Louisiana accept corn from Cargill-owned facilities along the Mississippi river as well as corn purchased from third-party grain handlers. The Reserve and Westwego facilities blend, grade and load corn onto vessels for transport to Asian markets.

Cargill filed the lawsuit after talks with Syngenta were unproductive, said Mark Stonacek, president of Cargill Grain & Oilseed Supply Chain North America.

Dave Baudler, president of Cargill AgHorizons U.S., said Cargill advocates for new technology, including new bioengineered/genetically modified seed products.

“I want to be clear about this:  Cargill is a supporter of innovation and the development of new G.M.O. seed products,” Mr. Baudler said.  “But we take exception to Syngenta’s actions in launching the sale of new products like MIR 162 before obtaining import approval in key export markets for U.S. crops.  Syngenta’s actions are inconsistent with industry standards and the conduct of other biotechnology seed companies.”
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