Chicago, Dec. 20 - A decision to stop testing U.S. rice for genetically modified traits when it arrives at its destination should help restore trade with the European Union, which has virtually stopped since August 2006, said U.S. rice traders Thursday.
The EU Standing Committee of the Food Chain and Animal Health made the decision on Thursday and it could take effect as early as mid-January.
"It is a good sign. There's been a bit of a pickup in shipments going there," said Neauman Coleman, an analyst and rice broker in Brinkley, Arkansas. "It's all proven to be GMO free. This is another positive step."
The discovery in August 2006 of the LibertyLink trait, developed by Bayer CropScience, a division of Bayer, in commercial supplies triggered a disaster for the U.S. rice industry.
The industry quickly moved to stop planting of the varieties identified as having the GMO trait, which resulted in less than 0.5 percent of this year's crop being affected, according to USA Rice Federation, a trade organization.
"The decision opens the door," said David Coia, spokesman for USA Rice. "Now, another layer of work begins where we have to begin to rebuild the market. This certainly helps tremendously."
A U.S. government investigation was unable to determine how the biotech rice entered the commercial supply chain. The GMO strain has gotten U.S. approval but no GMO rice is authorized for import or sale in the 25-member European Union.
MOST COUNTRIES TEST AT ORIGIN
Most countries allow exporters to test the rice for GMO traits before it leaves port. The EU's requirement to test at destination made sales extremely risky for sellers.
If the rice tested positive, they would encounter hefty charges
Before the incident, the European Union bought about 282,000 tonnes of U.S. rice in the 2005/06 marketing year. Exports fell to 50,000 tonnes in 2006/07.
"It's been a black cloud over the market for the past year and a half," said Ed Taylor, an analyst with Firstgrain.com, a market advisory service.
"It's a big deal," he said. "It means you no longer have the risk if you ship it over there of having it rejected once it gets there."