Japan Having Hard Time Procuring Non-GM Grains From U.S.

Tokyo, March 6 (Jiji Press)–Japanese trading houses are facing higher procurement costs for non-genetically modified grains such as soybeans and corns amid a growing production shift by U.S. farmers to more profitable gene-altered crops.

On the back of soaring grain futures market prices, American farmers increasingly turn out GM grains for animal feed and biofuels, instead of non-GM crops that require much more time and labor to produce.

Demand for GM crops is growing globally due to their higher tolerance to pests and unusual weather. But because of strong feelings of resistance toward GM crops among Japanese consumers, non- GM grains are widely used in Japan for food products including “tofu” soybean curd and “natto” fermented soybeans.

A shortage of non-GM grain supplies from the United States would likely cause food price hikes in Japan, whose food self-sufficiency rate declined to 39 pct in terms of calories consumed in fiscal 2006.

In the United States, GM crop acreage accounted for 91 pct of total production for soybeans and 73 pct for corn in 2007. The proportions are set to rise further this year, a source familiar with the matter said.

Behind the production shift to GM crops is an upsurge in grain futures prices in Chicago. As soybean and corn futures prices have more than doubled from the spring of 2006, earnings of farmers producing GM grains have increased significantly.

In a bid to stem the shift and encourage non-GM grain production, Japanese trading houses have raised premium payments to U.S. farmers, but negotiations on non-GM crop procurement are becoming even more difficult, industry officials said.END

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