Agricultural production in the United States stands at a crossroads. A key issue currently being addressed by our political leaders stands to change the future of agricultural biotechnology, and by extension, the landscape of farming in the United States. The issue is the pending World Trade Organization court case filed by the Bush administration against the European Union to compel the lifting of its five-year ban on genetically modified foods.

Although the EU ban has recently been lifted by the European Parliament, it was replaced by a genetically modified labeling system requiring identifying any foods with over 0.9 percent genetically modified content. This requirement may be seen as the same as a ban, given the amount of research showing consumers are less likely to eat genetically modified foods when they are informed by a label.

As a result, the nascent agricultural biotechnology industry might be throttled by the loss of such an important market for new genetically modified food products. With this in mind, the Bush administration is pressing its case in the WTO.

Further, while the EU has allowed soybeans genetically modified for herbicide resistance to enter into its markets in spite of the ban, the labeling system will effectively halt imports of the economically important commodity crop into that vitally important marketplace.

Besides closing off future lucrative markets to American farmers, the EU's moves may change the future of this major commodity. Thst would come as a further blow as, despite historically dominating the soybean market, the United States is falling behind South American countries Argentina and Brazil, whose combined output this past year exceeds that of the United States.

Specifically, according to U.S. Department of Agriculture's Economic Research Service 2002 data, the U.S. share of world exports of soybeans as of 2001 stands at 32.1 percent, down from nearly 80 percent in the late 1960s, while Argentina and Brazil's shares of exports have increased from negligible amounts in the late 1960s to 24 percent and 30.5 percent share of the world market, respectively.

And because, according to USDA's National Agricultural Statistics Service 2002 data, 74 percent of the United States soybean crop was genetically modified to be herbicide resistant, American farmers face a highly uncertain future.

Arkansas farmers likewise share a large stake in the outcome of the genetically modified debate between the United States and the EU. Soybeans are a major moneymaker for the state. According to Arkansas Farm Bureau 2002 statistics, soybeans account for 25.6 percent of the total value of the state's principle crops, with 40 percent of the crop exported. And of this total, according to USDA-NASS 2002 statistics, 63 percent of all soybeans planted in Arkansas was genetically modified.

Some industry observers suggest the current unwillingness of the EU to accept genetically modified foods is in response to the unilateralist positions taken by the Bush administration on a range of international treaties and actions, especially the Iraq intervention. However, concern over genetic engineering of any sort has a long history in Europe, stemming from reaction to Nazi Germany's attempts at racial purity in the 1930s and 1940s and continuing into modern times with the longstanding ban on most food biotechnology.

In addition, recent confrontations with mad cow disease and foot-in-mouth-disease have left Europeans concerned about the safety of their food supply and distrusting their governments' ability to protect them, further reducing their willingness to accept genetically modified foods that may present a health risk.

While the imposition of labeling is a major disincentive for farmers to grow genetically modified soybeans, let alone other crops, there is reason to consider alternatives to outright rejection of genetically modified plants.

The biotechnology industry claims many benefits with growing genetically modified plants. Environmentally, genetically modified plants currently in the field allow the use of no-till methods of agriculture, which has been shown to not only be more environmentally sound than other farming techniques by cutting pesticide use, but also save time.

Additionally, future genetic innovations in crops, such as soybeans, may lead to plants that are not only more environmentally sound, but also provide cheaper, tastier, and healthier food; medicines grown in plants making pharmaceuticals less costly and capable of treating a wide range of illness; and plant-made industrial products that would reduce our reliance on such raw materials as petrochemicals that pollute our environment and affect our foreign policy.

Approaches to dealing with this conundrum of attaining the promise of future genetically modified crops while maintaining public trust and export markets have been and continue to be discussed by policy-shapers and policy-makers.

Michigan State University agricultural economists Dave Weatherspoon, Christopher Peterson and David Neven suggest four scenarios that might occur in the very near future in response to current events.

The first two scenarios are extreme, and while not very likely, might occur.

The first is the broad based acceptance of genetically modified plants in which agricultural biotechnology gets fully incorporated into the marketplace. While this had been the case in the United States, recent political maneuverings by trade partners have diminished the likelihood of this occurring.

The second scenario, that of a complete ban, whether formal or informal, is also not as likely given the amount of research conducted on a wide range of genetically modified plants over the past 15 years, and the stake in them held by powerful industry interests.

The final two approaches are more likely.

One approach would be to ban growing of genetically modified plants that might end up in the food supply. This would allow for continued innovation in non-food crops such as cotton — of which Arkansas exports 60 percent — tobacco, and many other minor crops, and would serve to allay health-related concerns and the concerns of international trade partners.

A final approach that has been considered in great depth is developing a system of product differentiation, with three different streams of crops: conventionally grown crops with genetic modification, conventionally grown crops without genetic modification, and organic crops. In each of the streams, crops would be tracked from the farm to the grocer's shelves.

While potentially expensive, this approach would allow not only for markets and consumer choice for those that do not wish to consume genetically modified foods, but also would conceivably encourage the development of genetically modified crops that add value in the form of better taste and increased healthiness.

In addition, such an approach would enhance food security in a world threatened by bioterrorism, further bolstering trust in our food industry.

Whatever scenario plays out, Arkansas farmers, especially those cultivating genetically modified soybeans, face an uncertain future, one that hinges on the actions of our political leaders and decisions made in the international arena. In any case, the suit before the WTO bears watching.


Patrick A. Stewart, Ph.D., Director, MPA Program, Arkansas State University (870-972-3048)