Conventional wisdom within the grain industry has held that segregating genetically modified grains from conventional ones would be expensive and require building a new infrastructure. However, the Starlink corn problem has demonstrated the costs of not segregating, including expensive food recalls, rejected corn shipments, increased costs for GMO testing, and reduced exports to Japan and Korea.
Now industry experts see the trend toward segregation and identity preservation of grains as inevitable and necessary to preserve the purity of both non-GMO products and future GM traits with consumer benefits. U.S. Secretary of Agriculture Dan Glickman said agriculture must do a better job of segregating GM crops from conventional ones. The U.S.D.A. is considering what new regulations, if any, are needed to segregate GM crops and is asking for comments from the food industry, farm groups, grain exporters, and consumer activists.
"The long term message is that the U.S. market needs to develop methods to produce and market specific products to specific people. We need an alternative to commodity production," said Charles Hurburgh, professor, Department of Agricultural Biosystems Engineering at Iowa State University.
Dennis Strayer, an expert and consultant on identity preservation, based in Hudson, Iowa, said Starlink — a genetically modified maize variety not approved for human food use that was discovered in several U.S. brands of taco shells and other corn products — "is making the industry step back and take a closer look at how genetically modified crops are regulated, segregated and marketed."
Archer Daniels Midland Co. seems to be doing just that. In December, ADM aired radio commercials telling farmers it would not accept GM crops that have not received worldwide approval.
International factors are also forcing the issue. As the European Union, Japan, Australia, and other nations establish laws to label GM products, segregation will be required for labeling.
TREND TO SEGREGATE. "Everyone wants some type of segregation system to emerge," said Gary Beil, president, Minnesota Crop Improvement Association. "But they don't know yet what it will be."
The good news is there appears to be a growing trend toward segregation among grain elevators. A spring 2000 survey of 1,200 grain elevators conducted by Farm Progress Companies showed that nearly one in four elevators planned to segregate GM from conventional corn, while 20% said they would segregate GM and conventional soybeans. These numbers represent a significant increase from 1999 when a Grain Journal survey determined that only about 9% of elevators segregated GM from non-GM grains.
"Changes are happening," Strayer said.
According to the National Grain and Feed Association, about 5% of the nation's grain elevators can segregate non-GM grains without major investments in infrastructure. However, a recent University of Illinois study says that the current U.S. grain handling system will not require a radical overhaul in order to meet European Union requirements for non-GMO grains. The study, titled "The Economics of Non-GMO Segregation and Identity Preservation," examines in detail the stages of the U.S. grain handling system, how each functions, and how segregating GM from non-GM grains will affect them.
David Bullock, associate professor of agricultural and consumer economics and co-author of the study, said he does not expect to see an overhaul of the current grain handling infrastructure in the near term, but rather a "reshuffling" of elevator uses. For example, instead of incurring the expense of frequently cleaning elevator equipment, grain handlers are using multiple, smaller bins or dedicating entire facilities to either GM or non-GM grains.
Bullock said costs associated with reshuffling of elevator uses are much lower than would be the costs of building a whole new infrastructure.
Segregating crops at the farm level will help, according to Tim Aughenbaugh, president, IdentityPreserved.com. "On farm storage is definitely one way to overcome challenges of creating a new infrastructure," he said.
A Reuters straw poll of 400 farmers conducted early last year found that 15% planned to add storage for segregating GM and non-GM crops.
Biotech companies recognize that segregation will help them prevent the kind of problems that Aventis had with Starlink. Monsanto Corp. is developing a "channeling" program for its Round Up Ready™ corn, which is not approved for use in the E.U. The program, which involves seed companies, growers, and grain handlers, aims to channel Roundup Ready corn away from grain handlers and processing plants that send products to Europe.
IP IN DEMAND. In addition to segregation, the more stringent system of identity preservation is also a trend. While total IP acreage now accounts for an estimated 5% of U.S. grain production, Aughenbaugh predicts that will increase to over 50% within the next five to 10 years.
The demand for non-GM products is driving demand for IP systems. Sales of non-GM grains in 2000 doubled over 1999, according to Aughenbaugh.
Larry Svajgr, executive director, Indiana Crop Improvement Association, agreed. "IP systems are increasing," he said.
Indiana Crop works with seed, grain, and food companies on a significant number of IP programs, including ones to certify corn and soybeans as non-GMO.
The Association of Seed Certifying Agencies (AOSCA) developed the IP non-GMO programs, which require 99.5% non-GM purity in soybeans and 99% in corn. In 2000, over 100,000 acres of IP grains in the U.S. were administered under the AOSCA programs.
Beil said Minnesota Crop Improvement Association's IP acreage in 2000 doubled over 1999, due mostly to non-GM grains.
AOSCA is developing a manual that will help growers, grain handlers and traders, and food companies establish IP programs. The aim, according to Strayer, who is writing the manual, is to develop uniform standards for IP programs.
"We want IP systems to operate under some semblance of uniformity, but be flexible enough to allow companies to set their own tolerances and allow trades to happen," Strayer said.
Another indication of the IP trend is the establishment of the first "full-service" IP company that provides products, services, and Internet technologies to help food producers establish IP systems — IdentityPreserved.com.
"Our goal is to bring technologies to the IP process and drive costs out of the system," Aughenbaugh said.
Communication and teamwork are critical to an effective IP program. Aughenbaugh said the Starlink problem resulted from a breakdown in communication between seed companies and farmers.
"As we move toward stewarding these products, communication between all parties becomes critical," he said.
Strayer added, "With IP systems, grain trades must be team efforts; every party must know their responsibilities and those of other parties in the chain to accomplish the task."
IP systems will be necessary to accommodate the next generation of GM crops with output traits that benefit consumers, Svajgr said. "It will be important to preserve the identity of value-added traits as they are developed," he said. "It's a good thing that we are getting used to these systems."
For now, the demand for non-GMO is helping to build the infrastructure, Hurburgh added. "No one thought that the need to avoid biotech grains would be the driving force for developing specialty product marketing systems," he said.
TECHNOLOGIES WILL HELP. A recent breakthrough at the University of Wisconsin may help alleviate the most contentious and potentially litigious issue between growers of GM and non-GM corn: cross-pollination. Jerry Kermicle, a plant geneticist, discovered that teosinte, an ancestor of modern corn, contains a natural genetic barrier that blocks out foreign genes, thus preventing cross pollination from other plants.
Kermicle bred the genetic barrier into conventional corn hybrids, and the Wisconsin Alumni Research Foundation plans to make seed available for the hybrids by 2003. As a result, farmers will be able to plant non-GM corn without worrying about contamination from neighbors' GM corn, which will also make segregation easier.
Internet technologies will aid segregation and IP efforts. The company IdentityPreserved.com offers web-based educational and technical information, data collection and database systems, and online market services that enhance collaboration and communication within an IP system.
CropVerifeye.com, LLC, an online grain auditing company, recently introduced what it calls "the world's first field-to-food data-tracking system with e-commerce capabilities." The system, known as SmarTrace™, monitors the quality and integrity of crops and food ingredients as they move through the food chain, while providing food companies with the technology infrastructure to share detailed product information with consumers.
"Internet technologies will make information transfer faster," Strayer said. "For example, a field inspector could input his data, which would then be immediately accessible to a buyer in Japan."
Issues of segregation and identity preservation come down to cost. Growers and grain handlers want premiums to segregate or IP grains and food products, whether GM or non-GM, in order to absorb the added costs for extra facilities and bins, transportation, equipment cleaning, testing, etc.
"If there is enough incentive, grain handlers will do it," Strayer said.
Unfortunately Starlink, with its financial losses, has added negative incentive by demonstrating the risks of not segregating.