TED Case Studies
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1. The Issue
The latest biotechnology has given rise to dispute between Saskatchewan farmers and an American company called Monsanto Co. which produces genetically engineered canola. The farmers are accused for "illegally" planting last years crop. Monsanto Co. owns the patent on a Roundup resistant canola crop. The crop is not affected by the pesticide Roundup which is also produced by the same company. Monsanto Co. is viciously hunting down "illegally" planted crop on farmlands without caring if the farmer is affiliated with the company or not. The company has established a monopoly on the crop and they force farmers to sign a three year agreement to let Monsanto Co. periodically test the crop in order to see if it is from the previous year. The company is prosecuting innocent farmers and using the agreements to force farmers to continue buying the canola. The crop Monsanto is producing will affect agricultural trade between the U.S., Canada and other countries due to an International Treaty restricting the trade of altered crop.
2. Description
Monsanto's money maker
is the pesticide Roundup which kills weeds and crop. But Monsanto Co. has
developed a crop that is resistant to Roundup. The company which is a leader
in its field, believes that the technology they are applying to the crop
is beneficial for the farmers and ultimately the consumer. The company
has also succeeded to patent a gene which causes resistance to the pesticide
Roundup. If a farmer buys the crop from Monsanto Co. it is crucial for
the farmer to buy the specific pesticide to ensure that the crop will survive.
Monsanto has created a monopoly by forcing farmers into buying crop and
pesticide that will assure them a good harvest. The farmers become obligated
to buy "fresh" seed every year (The Washington Post, 3 February
1999). Monsanto Co. has a monopoly on the seed because they are the only
producer of the Roundup Ready canola. The company has made Saskatchewan
farmers dependent on their crop.
Monsanto is currently developing
a crop that has a "terminator" gene. The seeds produced by the plant are
sterile. This will eliminate replanting of the previous years harvest.
The biotechnology company will be able to sell its seeds to farmers without
fear that they will "illegally" plant "old" crop. This will enable them
to control the farmers and their harvest. Farmer's are not able to switch
back to the old crop according to Geoffrey Hawtin, the director general
of CGIRA's International Plant Genetic Research Institute in Rome, it is
very hard for farmers to go back to the original crop because they have
already lost their traditional crop by replacing it with the altered crop
( The Washington Post, 8 February 1999). Hawtin opposes the fact
that companies which specializes in this Biotechnology will have an upper
hand on the farmers; "Then these companies will be sitting on a captive
market". This might have long run consequences such as a disruption in
trade. The farms are not able to switch back to the original crop which
could lead to less agricultural trade due to a biosafety treaty which restricts
the trade of genetically engineered products. The treaty is not the only
thing that worries farmers according to Henry Shands at United States Department
of Agriculture (USDA) gene resource center; foreign farmers will
not receive the top of the line gene altered crop by U.S. biotechnology
companies. The companies will sell its best "breed" in the U.S. while exporting
secondhand crop to other countries. This will clearly give the U.S. agriculture
an comparative advantage on the market if they can offer better crop than
other countries.
An international biosafety
treaty was signed in February 1999 to regulate trade of genetically
engineered crop. The negotiations took place in Colombia and involved 174
countries. The treaty could be disastrous for Canada because agriculture
exports accounts for a third of Canada's export (22 billion CAD). Canada
has over 2.8 million hectares of farmland that is used to grow different
kinds of crop. 12.1 million hectares of farmland is used to grow genetically
altered crop such as canola, flax, and soya etc. Saskatchewan is the largest
producer of canola among the provinces on the Canadian Prairies. The production
is 41 % compared to Manitoba (17%) and closely followed by Alberta (40%)
(USDA's Canadian Canola Production Web page). The treaty will affect all
of Canada due to the excessive use of genetically engineered crop. The
spokesman for the Canadian Federation of Agriculture expressed his concern
about the treaty; "We believe that this protocol has the potential to seriously
disrupt trade in agricultural and agrifood products" (qtd. in The Ottawa
Citizen, 1999). The treaty will require countries to label the crop
if it has been genetically engineered. This is worrisome for Canadian farmers
who are dependent upon agriculture. The Canadian government will continue
promoting the altered crop due to heavy investment in biotechnology. Mark
Winfield, who is the research director of the Canadian Institute for Environmental
Law and Policy, points out that "Canada will try to force the products
into markets whether they want them or not" (qtd. in The Ottawa Citizen,
1999).
The environment is another
factor in the debate over gene altered crop. Another U.S. company, AgrEvo
Co., is producing genetically altered canola also resistant to a
pesticide. The USDA approved the use the canola based on scientific data
provided by the company and independent scientists. The data showed that
the canola will not affect the environment. "However, evaluation of field
data reports from field tests of this canola conducted under APHIS permits
since 1996 indicates that there were no deleterious effects on plants,
non target organisms, or the environment as a result of the environmental
release of event T45 canola" (Federal Register, 10 February , 1998). The
Canadian counterparts known as AAFC (Agriculture and Agri-Food Canada),
Health Canada, and the Canadian Food inspection has deemed genetically
engineered crop to be safe. But, there are still organizations and countries
that are opposing the use of genetically altered crop. The institute of
Agriculture and Trade Policy in Minnesota is concerned with the fact that
the farmers in third world countries will be dependent on gene altered
crop. The farms might not be able to afford paying the price for the crop
after getting "hooked" which will lead to massive starvation. This do not
directly concern the Saskatchewan farmers, but they will be affected if
they cannot freely trade the genetically engineered crop they are cultivating.
There will be a huge surplus of rotting crop if other countries refuse
to buy the crop they are producing.
Canadian farmers will loose
some of their comparative advantage if the restrictions are enforced. They
are heavily dependent on farming in the Prairies. The biotechnology Monsanto
Co. is taking advantage of the vulnerability of the farmers after signing
the contract which forces them to follow the rules and regulations of replanting
seed. Anyone who has farmed knows that it is tradition to collect the seed
from the previous year and sow them next years. A saskatchewan based organization
called Clearly Canola supports genetically altered canola because;
By increasing the ability of canola to withstand environmental
deterrents, these developments may allow producers to grow
canola crops in some parts of the country which are currently
unsuitable for canola production. Along with additional
canola oil supplies, this could also provide greater agricultural
productivity to areas in Canada currently able to grow only cereal crops.
(Clearly
Canola)
But, Clearly Canola do not consider the impact altered canola might
have on trade. The whole issue of gene altered crop is relatively new and
we do not know the long term effects on the environment. The short term
effects of the restrictions requiring labeling of gene altered crop
which leaves it up to the customer to decided whether to buy the product
or not. This could devastating for Canadian Prairies that rely heavily
on farming gene altered canola and other vital crops.
3. Related Cases
4. Draft Author: Katarina Vilkman
4/7/99
5. Discourse and Status:
The genetically engineered crop case is in progress. It is a very touchy question in Europe which affects Canadian farmers.
6. Forum and Scope:
The case concerns 174 countries (multilateral case)
7. Decision Breadth:
It concerns
all countries that farm or import agricultural products.
8. Legal Standing:
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9. Geographic Locations
a. Geographic Domain: North America
b. Geographic Site: Saskatchewan
c. Geographic Impact: Canada
10. Sub-National Factors: No
11. Type of Habitat: The Prairies
12. Type of Measure:
International Treaty restricting trade of genetically engineered grain.
13. Direct v. Indirect Impacts:
* Direct: The trade will be impair trade with other countries due to heavy reliance on genetically engineered crop.
* Indirect: The restriction measures will affect the farmers who rely on agriculture.
14. Relation of Trade Measure to Environmental Impact
a. Directly Related to Product:
Yes
b. Indirectly Related to Product:
Yes
c. Not Related to Product:
No
d. Related to Process:
Yes
15. Trade Product Identification:
Genetically engineered crop such as Roundup Ready canola
16. Economic Data
GDP/PPP (1996 est.): $721 billion; $25 000 per capita
Real Growth Rate: 1.4 %
Inflation: 1.4 %
Unemployment: 9.7 %
Arable Land: 5 %
Agriculture: canola, wheat, barely, oats, and livestock
Labor force: 15.1 million
Exports: wood pulp, timber, machinery, agriculture products, natural gas, and motor vehicles
Imports: chemicals, durable consumer goods, computers
Major Trading Partners: The U.S., Japan, EU, Mexico, South Korea, China, and Taiwan.
17. Impact of Trade Restriction:
High -- Markets are closing due to the new treaty. Canadian farmers are going to suffer from the restrictions on genetically engineered grain produced by U.S. companies.
18. Industry Sector:
Agriculture
19. Exporters and Importers:
Exporters: Canadian farmers.
Importers: Countries all over the world.
20. Environmental Problem Type:
* The Roundup Ready Crop spreads easily to surrounding farmlands.
* Birds eating insects may be affected by genetically engineered crop in the long run.
* Unknown consequences of genetically engineered crop on the environment.
21. Name, Type, and Diversity of Species
Name: Roundup Ready Crop
Type: Canola
Diversity: Plenty
22. Resource Impact and Effect:
Unknown impact on the environment.
23. Urgency and Lifetime:
Relatively new issue affecting both farmers and crop, therefore urgent to be resolved.
24. Substitutes:
Growing crops that are not genetically altered.
25. Culture: The Prairies are dependent on there agriculture. It is a part of Canadian culture
26. Trans-Boundary Issues: N/A
27. Rights: N/A
Duffy, Andrew. " International rules to be set on trade of genetically alteredfood. " The Ottawa Citizen 12 February 1999: Business; D11
Clearly Canola Home Page
http://www.canolainfo.org/html/canola.html
Federal Register: February 10, 1998 (Volume 63, Number 27) (Primary Source)
Weiss, Rick. "Seeds of Discord -- Montsanto's Gene Police Raise Alarm On Farmers' Rights, Rural Tradition." The Washington Post 3 February, 1999: A6, Col. 1
Weiss, Rick. "Sowing Dependency of Uprooting Hunger?."
The
Washington Post 8 February, 1999: A9, Col. 1
USDA Canadian Canola Production (Primary Source)
http://www.usda.gov:80/agency/oce/waob/jawf/profiles/html/can/cancan.html
