November 23, 2017
Monday, April 6, 2015

Argentine farmers accuse Monsanto of abusing dominant position in GMOs

A soybean field in the south of Santa Fe province.
A soybean field in the south of Santa Fe province.
A soybean field in the south of Santa Fe province.
By Guillermo Háskel
Herald Staff

Producers in the breadbasket country say the US agribusiness giant clinched accords so that exporters charge farmers an additional fee for royalties

Argentine farmers, who have been confronting the government over export duties since 2008, are accusing the local branch of agribusiness giant Monsanto of “abusing its dominant market position” to impose “private duties” via exporters to make producers pay for alleged transgenic seeds property rights.

They also accuse the government of outgoing President Cristina Fernández de Kirchner of failing to prevent the Monsanto clause from being enforced. Argentina's four farm lobbies grouped in the liaison board argue that the local branch of of the St. Louis, Missouri-based Monsanto has signed confidential accords whereby exporters, acting as retention agents on its behalf, would charge producers an extra fee per ton of soybeans that tests positive for Monsanto's genetically modified seeds. Jorge Solmi, the second vice-president of the FAA small-farm federation (one of the four lobbies protesting against the government for seven years now) estimated the extra fee at about US$15 per ton.

The accords were due to start being enforced last Wednesday. Solmi told the Herald that farmers have already received a communiqué from the local unit of Chicago, Illinois-based Archer Daniels Midland Company (ADM) — one of the largest agricultural processors in the world — that it was enforcing the accords.

The Herald made several attempts to contact Monsanto — to no avail. Businesses across Argentina were closed on Thursday and Friday for Easter celebrations. A telephone operator said the ADM number does not appear in the telephone book.

The liaison board last month rejected “the Monsanto clause for being abusive, arbitrary and compulsory regarding buy-and-sell soy contracts whereby buyers (silo firms, exporters and mills) could take the necessary measures to detect the presence of RR2/Intacta gene technology in the grains and retain a sum to pay for royalties, altering the rules and practices of grain trade.”

Argentina is one of the largest soy exporters in the world.

“We the producers acknowledge that seeds" genetic technology and improvements must get a fair retribution but Monsanto's attempt to charge for royalties is unacceptable and could set a precedent for other technology companies to adopt similar methods to get paid, using third parties not involved in the production process,” the liaison board said in a statement.

The SRA, another liaison board member, said that any payment for genetic technology must be included in the seeds price.

‘To conquer the world’

Solmi said that Monsanto's vocation is to conquer the world. To illustrate his assertion, he resorted to a dialogue in the "Pinky and the Brain" cartoon of two genetically modified mice. “When Pinky says: ‘Gee, Brain, what do you want to do tonight? Brain replies: The same thing we do every night, Pinky — try to take over the world!’"

Solmi added: "We have already seen this in 2001 when Monsanto attempted to appropriate the glyphosate market by denouncing alleged dumping of Chinese glyphosate (weed-killer). But in 2004 it lost that battle in Argentina. Then, in 2006 it attempted to appropriate Argentine shiploads in Europe via injunctions alleging rights over transgenic soybeans. But European courts eventually ruled against it. However, if it was unable to stop our soy shiploads, the move allowed Monsanto to negotiate in better terms with Brazil, Paraguay and Uruguay."

After a direct approach to producers mostly failed, Monsanto is now trying to do something similar regarding the RR2 gene by resorting to the accords with the exporters so they charge the extra fee to producers at ports, the FAA vice-president said.

Monsanto has clinched accords with South-East Asia countries such as China, Vietnam and North Korea, who will buy farm products as long as Monsanto certifies that the due patents for those products have been paid, he said.

"Now, exporters tell you that they cannot sell products to those countries without Monsanto’s green light. And Monsanto does not give permits to exporters if they do not sign an accord to test the soy for the RR2 gene. And in case they test positive, exporters charge producers about US$15 per tone."

The genetic tests are similar to pregnancy tests. "They just detect whether there is pregnancy, but they do not reveal the time lapsed or the sex of the baby."

If a soy truckload is found to have 10 percent or more of the RR2 genetic technology, it pays as if it were 100 percent. This forces farmers to segregate truckloads, which entails logistics efforts paid for by producers, the FAA official said.

RR2 is a variant of RR1. RR1 is glyphosate-resistant while RR2 is additionally resistant to some kinds of insects.

"Monsanto claims property rights over the RR2 patent. However, international property principles don’t allow to patent living beings. Monsanto claims to be patenting not a living being but a genetic alteration. But we say that, at the end of the day, a plant, a living being, is involved. The company argues that it is protected by patent laws but we are protected by article 27 of Argentine seeds law number 20247," Solmi said.

Article 27 states: "Producers have the right to buy seeds and sow them, and to keep part of what has been sown."

Monsanto is incurring in abuse of its dominant position because it is the only provider of this technology. The 100 percent of soy sown in Argentina is transgenic because high fiscal and financial costs don’t allow for other kinds of crops. Glyphosate-resistant weeds are growing, and to fight them is very costly, Solmi said. "The only option for farmers would be not to use that genetically modified organism technology. It is as if they have a water bottle in the Sahara desert. If you don’t drink it, you die. Our legislation is not like that of the US. Our laws envisage protection for the weaker party and Monsanto is not the weaker one."

Asked whether producers could take the case to courts he said that they were taking legal advise but that they chose now to wait and see whether the government steps in.

Last week, FAA Chairman Omar Príncipe said at a press conference: "We oppose a system they want to impose on us to take the lion’s share. We are not against the access to technology, but we do not consent this attempt to charge extended royalties and that multinational companies seek to take farmers hostages."

For its part the CRA, one of the other four lobbies, complained about the "alarming passivity of the national authorities, who have done nothing to stop this abuse."

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