Did Jumping the Gun Kill a Market and Sow the Seeds of Discontent?

Jeffersonville, OHMaking a go of it in the farming industry is tough enough, without supply corporations making what is easily a hard life even tougher. To that end, the manufacturer of a genetically modified corn seed, Syngenta, is facing a spate of Syngenta Lawsuits following a debacle that cut US corn exports in one year by as much as 85 percent.

It’s a complicated story - but it begins with the development of a genetically modified seed by Syngenta. Viptera and Duracade corn seed were formulated to help ward the plant from common pests such as black cutworms, corn earworms, dingy cutworms and western bean cutworms. Such pests are common enemies of the corn plant and have threatened yields in recent years.

Syngenta, the manufacturer, had assured farmers that it was safe to plant Viptera corn seed, as well as Duracade, given that Agrisure Viptera, as it is scientifically known, had been duly approved for planting in the US in 2010, and that countries such as Australia, New Zealand, Belarus, the European Union, Indonesia, Japan, Mexico, Russia and South Africa had approved imports of seed carrying the MIR 162 trait.

However China, easily the largest importer of American corn, had yet to approve it. That request was made in 2010. Presumably Syngenta, an otherwise reputable manufacturer, assumed that approval by China of the MIR 162 trait was imminent, and therefore launched a “Plant with Confidence” campaign directed at US farmers.

Farmers went ahead and planted Duracade and Viptera corn seed, based on those assurances.

And then, the unthinkable happened…

All export shipments of Viptera and Duracade corn seed containing the MIR 162 trait were denied by China, owing to the fact that China had yet to approve MIR 162. Given that China remains the largest importer of corn, US prices of the commodity fell.

Mix and match helps foster the glut, drops prices further

It gets worse. While only three percent of US fields were planted with Duracade and Viptera corn seed prior to China’s approval of MIR 162, the various processes involved with harvesting and distributing corn seed allows for cross-pollination through comingling and mixing prior to shipment.

As a result, all corn shipments - even the 97 percent of corn not originally planted as Viptera or Duracade - were denied access to China, creating a glut in the US market. Prices for all US corn dropped as a result. Significant losses were experienced by all farmers attempting to export corn, in addition to the small 3 percent who planted Duracade corn seed and Viptera in the first place.

China eventually cleared MIR 162 for import. But the damage had already been done.

The Columbus Dispatch (1/6/15) reports that the unfortunate circumstance reduced US corn exports by a staggering 85 percent last year. Various Syngenta Lawsuits have been filed, with more than 30 filed in US District Court for the Southern District of Ohio on December 3 of last year. The allegation is that Syngenta’s decision to release and market the corn seed prior to China approving imports, effectively pushed down corn prices and created hardship for farmers, their families and their operations.

One lawsuit, filed by the Mayer Family Farm Trust of Jeffersonville, is fairly representative of the lawsuits filed. The lawsuit alleges that Syngenta “gambled US farmers’ livelihood on approval of Viptera by the major corn-importing countries.”

It should be noted that both the National Grain and Feed, and the North American Export Grain Associations asked Syngenta in early 2014 to stop selling Viptera and Duracade until China and other markets approved its import. For its part, Syngenta says it was following all the rules. “Syngenta believes that the lawsuits are without merit and strongly upholds the right of growers to have access to approved new technologies that can increase both their productivity and their profitability,” said Paul Minehart, head of corporate communications for Syngenta in North America, in a statement.

In addition to the various Syngenta Lawsuits filed by farmers, various exporters have also joined the litigation fray. Cargill Inc. of Minneapolis and Trans Coastal Supply Co. of Decatur, Illinois, also are suing Syngenta.

According to The Columbus Dispatch, 177 lawsuits were transferred to federal court in Kansas in December of last year. That transfer included Syngenta Genetically Modified Corn Seed Sales lawsuits, filed in Ohio.

And it is expected that there could be more Syngenta lawsuits coming. That’s because of the potential losses suffered by farming operations of all stripes, from large farms to independent operators. However, beyond actual farmers and farming operations, there are distributors and exporters who also may qualify for litigation. What’s more, due to the unique nature of the situation, farmers who planted Duracade and Viptera corn seed - as well as those who did not but nonetheless still incurred losses - all have legal grounds to make a claim.

Farming is a hard life, with so many variables - not the least of which is weather, over which no one has control and every farmer is at the mercy of the environment. When a market is decimated needlessly, as it is alleged to have been, farmers and those affected in the industry have plenty of reason and recourse to take legal action.