Brazil's rules for modified food alarms Argentina
May 8, 2003 (Reuters)
By Karina Grazina

BUENOS AIRES, Argentina, May 8 (Reuters) - Brazil's decision this week to postpone the application of new rules requiring that labels identify genetically modified goods failed to calm nervous exporters in Argentina, where use of the products is extensive.

Brazil's new rules mandate the labeling of foods or ingredients of foods with more than 1 percent genetically modified material.

The regulations sounded an alarm in Argentina's food industry, which has pointed to what it calls the enormous cost and logistical challenge of complying with the rules by separating genetically modified crops from traditional ones.

Brazil is Argentina's main trading partner and some 13 percent of the $11.4 billion of food Argentina exported last year went to Brazil, according to the Organization of American States' agricultural institute.

Major food exporter Argentina is second only to the United States in the use of genetically modified products, but while proponents say they increase efficiency, opponents say they could contain hidden health and environmental risks.

Apart from applying to soy oil and corn oil, the new rules also affect dairy products and meat of animals that may have been fed with genetically modified grains.

Argentine producers say the rules are stricter than in Europe, where resistance to genetically modified products is particularly high.

"They've gone too far in including animal products ... Argentine dairy products would have to carry a label saying this product comes from animals fed on GMOs," said Roberto Domenech, undersecretary of food at the agriculture department. "This hasn't been seen anywhere in the world."

Argentina does not require labeling of genetically modified products.

"We respect each country's decision on whether to introduce a labeling system based on scientific criteria, but we think it is going to be difficult to implement for both countries," said Federico Ovejero, a spokesman for the Argentine unit of U.S. biotechnology giant Monsanto (NYSE:MON - News).

Brazil on Thursday forecast record grain crops this year and said it will overtake the United States as the world's No.1 soy exporter.


The new rules sparked surprise and confusion, prompting Argentina's Foreign Minister Carlos Ruckauf to begin negotiations with his Brazilian counterpart Celso Amorim that ended with an agreement to postpone the measure.

"A time period has been opened up to study how the rules will be applied to Mercosur (trade bloc) countries," Argentine Deputy Foreign Minister Martin Redrado said, without specifying how long the period would last.

Mercosur comprises Argentina, Brazil, Paraguay and Uruguay.

Argentine industry sources viewed the negotiations with skepticism. "I don't see them having much success; they are just delaying things by a little," said a food company official who asked not to be identified.

Brazil has also authorized the sale of genetically modified soy to try to end a large black market in illegal genetically modified soy planting.

"First we have to see how Brazil deals with this domestically and then how it deals with Argentina, because in Brazil there is also a high percentage of GM soy," said Victor Castro of the Argentine Association of Seed Producers. (Additional reporting by Nicolas Misculin)