Argentina tackles million-dollar illegal seed trade
Argentina is debating how best to tame its multimillion-dollar illegal seed trade after U.S. biotech giant Monsanto Co. threatened to charge royalties on Argentine soybean shipments abroad.
Argentina's seed business is worth an estimated $1 billion a year and the prosperous black market is mainly in soybeans, the country's top crop and biggest export.
Monsanto, a pioneer of biotech seeds, stopped selling soybean seeds in Argentina last year, saying it could not recover its investments.
Farmer groups, seed producers and government officials are debating whether royalties in Argentina should be charged on seed sales -- which the government prefers -- or when the grains are sold, or through a mixed system.
"We are trying to figure out what is the most efficient system that would need the lowest level of control. We already know that it's been very difficult to control the system of payment (of royalty) at the point of seed sales," said Ernesto Ambrosetti, chief economist for the Argentine Rural Society producers group.Monsanto Argentina would not comment on the talks.
More than 90 percent of Argentina's soy crop contains Monsanto's Roundup Ready soy technology, which was designed to resist the effect of a specific herbicide, making the crop cheaper and easier to grow.
Argentina is the world's third-largest soy producer after the United States and Brazil.Meanwhile, earlier today soybean growers in Rio Grande do Sul state, which produces about 95 percent of Brazil's genetically modified soy, rejected a rise in royalty charges by Monsanto, which is headquartered in St. Louis, Missouri.
Monsanto's local unit said on Sept. 29 it would double royalty charges for use of its patented Roundup Ready soybeans (RR) by ending a 50 percent discount offered to producers last season. The royalty will rise to 1.20 reais (US$0.42) per 60-kg bag, or $20 a tonne, from 0.60 real a bag last season.
It is legal for Argentine farmers to plant seeds they have saved from the prior season without paying royalties. But it is illegal for them to sell the saved seeds to someone else, which is the basis for the burgeoning illegal trade.
(From Reuters, October 20, 2004)
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