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European and American millers tell U.S. Wheat Associates Board to go slow on GM wheat

(Thursday, Aug. 29, 2002 -- CropChoice news) -- The following is a U.S. Wheat Associates press release.

Washington, DC--At their summer board meeting, the Board of Directors of U.S. Wheat Associates heard a clear message on genetically modified wheat from some of the most important millers in Europe and America.

Last year, the European Union was the fourth largest customer of U.S. wheat, importing 2.16 million metric tons. And General Mills is one of largest domestic wheat buyers, purchasing one out of every 9 bushels of U.S. wheat sold domestically.

>From the largest miller in Italy, who uses 11 million metric tons of wheat annually: "The European milling industry will simply not buy one more kilo of any U.S. wheat at all" if Roundup Ready wheat is commercialized.

"In a situation with ample and cheap alternative supplies and a general, strongly convinced public opinion against genetically modified organisms, we will have no alternative," said Antonio Costato, CEO of Grandi Molini.

>From the wheat buyer at Rank Hovis, which controls 30% of the milling and the baking industries in the UK: "I am going to ask you not to grow genetically modified wheat until we are able to sell in our market the bread made from the flour made from that wheat. I cannot tell you how to run your business – but if you do grow genetically modified - or enhanced – wheat, we will not be able to buy any of your wheat – neither the GM nor the conventional. The latter because we will not be able to guarantee the integrity of even the conventional to zero content of GM."

"This has nothing to do with principle, or trade barriers," explained Peter Jones from Rank Hovis. "We just cannot sell it."

Ron Olson, vice president from General Mills, agreed with his European colleagues about the importance of building and maintaining brand integrity, pointing out that about half of the wheat used domestically is used in branded products, which carry higher risks if consumer confidence is lost. Corporations must protect brand integrity for their stockholders and "we will not do anything to erode consumer confidence," Olson said.

"In every study [of U.S. consumers]... there's still 7 to 10 percent of the people who say I will not buy a product if it contains a genetically modified ingredient," Olson told the USW board. "When you come to a company like ours, which is a wheat-based organization, and we run the risk that we will lose 7 to 10 percent of our business if we change a product and it becomes an issue... I don't think that's a risk our corporation would take."

Olson further explained the problems that will be experienced up the food chain, beyond the grower, noting a traditional economic concept: "When you inject a supply driven concept into a demand driven market, it's a recipe for failure."

Each of the customers made it clear that there is a likely future for biotechnology in wheat, when traits are developed that will provide consumer benefits and when consumers are convinced of the safety of the food.

But they made it equally clear that they did not believe that time for GM wheat had arrived.

"I do believe that GM is the future of agriculture," Costata said, "but, so far, our 380 million customers are opposed to it." Jones, repeating his plea to the growers not to grow GM wheat, ended with the statement "This is not 'never.' It's just 'not now.'"

And Olson reminded the board that "General Mills strongly believes in the potential technology."

But, he said, "it's an evolution, not a revolution... At some point in time the benefits will help offset the [consumer] perception side." In the meantime, Olson asked that "we proceed with a lot of caution, education and transparency, in a more open format where all parties in the chain cooperate as we move forward."

For more information, call 202-463-0999.