Reuters
Monsanto urges Brazil soy growers to pay royalties
Tuesday September 16, 5:33 pm ET

SAO PAULO, Brazil, Sept 16 (Reuters) - Monsanto Co. (NYSE:MON - News) has urged Brazil's southern soybean farmers to pay royalties for future use of the firm's Roundup Ready (RR) soy technology, even though it may still be banned in Brazil.

The company ran a notice on Tuesday in local newspapers in Brazil's south, including Rio Grande do Sul, Santa Catarina, Parana and Mato Grosso do Sul states, where most of Brazil's illegal genetically modified soy is believed to be planted.

"Given that soy planting should begin in a few weeks, Monsanto advises that planting (GM) Roundup Ready Soy continues to be banned by decision of the TRF (court) on September 8, 2003," the company began the notice in the papers.

The company in Brazil declined to comment on the notice.

"Independent of the process of lifting of the ban, producers that should plant Roundup Ready Soy ought to consider paying for the use of the technology at the time of sale of the production (soy)," it went on.

By unofficial estimates, about a third of Brazil's total soy crop is illegal GM, but in the southernmost soy state of Rio Grande do Sul, transgenic soy is thought to account for up to 70 percent of state output.

Monsanto earlier this year had tried unsuccessfully to get local producers to pay royalties for the use of transgenic RR soy, which allows farmers to save money by using less herbicide to keep their crops weed-free.

The company had also unsuccessfully tried to get cooperatives and exporters to pass on the royalty costs at the time of purchase of GM soy from producers.

Brazil is the world's No. 2 soy producer and exporter and should overtake the United States as top grower in about six years.

U.S. soy producers complain that Brazilian growers have an unfair advantage because they don't pay royalties on the GM technology.

Seeds for Brazil's black market GM soy cultivation are believed to be smuggled in from Argentina where RR soy is widely planted. GM soy varieties from latitudes that far south do not grow well further north than Parana or lower Mato Grosso do Sul due to the different light cycles of tropical regions.