Brazil genetically engineers more than 93% soybean, 90% corn, and 60% cotton. Brazil is the second largest producer of genetically modified crops in the world, after the United States. Ironically, a rush to export a record Brazilian corn crops skyrocketed corn cash prices; a severe domestic shortage of corn left various livestock producers resorting to feeding their animals wheat as an emergency substitute. Others cut output by 10%.
The situation is dire; pork and chicken producers, including the world’s biggest poultry exporter BRF SA, have closed plants and slaughter houses. A reduction in work shifts and laying off employees contnues. Pedro Faria, Global CEO of BRF, recently commented:
“The first quarter of the year was one of the most challenging periods of the last decade, due to a combination of very distinct events. While chicken production in Brazil reached record levels, pressuring prices, the cost of corn [in Brazil] has risen exponentially – and without any correlation to global prices – with an increase of more than 30% compared to the end of 2015.”
Despite the worst-ever shortage and record prices of corn in Brazil, reported imports of genetically modified corn from the United States for 2016 are non-existent. (Brazil exported over 11 million tons of corn in the last two months of 2015).
Brazil’s stringent regulations on GMOs maintain this trend. In January, the economically and politically turbulent South American country heavily fined six global food giants, including Nestlé and PepsiCo, for failing to disclose products containing GMOs.
Even though the government eased restrictions on corn imports to help meet domestic demand in April, Brazilian farmers have refused to buy US-grown GMO corn. Bloomberg reports:
“The companies aren’t buying American grain because they’re concerned that Brazil’s stringent regulations on genetically modified organisms, or GMOs, threaten to hold up shipments… In recent years, some of the largest commodity trading companies have refused to take certain GMO crops from farmers because the seeds used hadn’t received a full array of global approvals, something that can lead to holdups at ports or even the rejection of entire cargoes.”
— Nancy Mitchell (@NancyWonderful) June 14, 2016
Brazil allows farmers to grow 29 varieties of genetically modified corn, refuses certain varieties to enter the country, and mandates GMO labelling. The U.S. grows 43 types of genetically modified corn; that modified agricultural commodities carefully segregate and inspect at Brazilian ports. Reports suggest the Brazilian Ministry of Justice issued fines against six food manufacturers concealing the use of GMOs. Risk outweighs benefit: importing genetically modified corn from the United States imposes high penalties for Brazil’s meat producers.
Data from the Brazilian agriculture ministry shows that no US-grown corn arrived in Brazil in the last six
months; however, in April the country imported 106,000 tonnes of corn, the most imports of the grain since October 2014. Around 58% of that volume came from Argentina and the rest from Paraguay, writes Reuters.
According to Reuters, the agricultural sector is counting on relief from the second of two annual corn crops arriving. However, dry weather curbing yield output remains a reality, causing possible high feed costs until early 2017.
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