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StarLink fallout could cost billions
Future of modified crops thrown in doubt, report says 

STUART LAIDLAW / The Toronto Star 9jan01

`The hope of the industry is that over time
the market is so flooded that there's 
nothing you can do about it. 
You just sort of surrender.'

Don Westfall, senior VP
Promar International, a strategic marketing and consulting firm,
and "Problem Solver to the Food Chain."

The StarLink controversy in the United States could cost the food industry billions of dollars and has thrown the future of genetically modified foods into doubt, a report by a food industry consultant says.

The mix-up will lead to dozens of lawsuits over the costs of cleaning up the mess, while giving consumers more reasons to worry about the safety of genetically modified foods, the co-author of the 74-page report said.

"This is going to come back to haunt the regulators and the food industry," said Don Westfall, vice-president of Promar International, a consulting company based in a Washington, D.C., suburb.

Hundreds of brands of taco shells and tortillas were recalled last fall after StarLink corn, which is approved in the United States as animal feed only, got into the food chain.

Westfall would not release a copy of his report, which is being sold to food companies at $5,000 (U.S.) a copy. Sample pages and a table of contents are available at the firm's Web site, http://www.promarinternational.com.

The company's client list includes all the world's major food businesses such as Kellogg Co., ConAgra Foods Inc., Unilever NV and Aventis SA, the company that made StarLink.

Westfall, who supports the development of genetically modified, or GM, foods, warns that the future of such crops may well depend on how the StarLink situation is handled.

If it is handled badly, he said, consumer resistance to GM foods is likely to grow.

"In the future, we will have this problem of newer products with more novel proteins where you can't really say whether there are allergies," he said in a telephone interview.

Such products will fulfil a long-standing industry promise to grow drugs in plants. Agriculture Minister Lyle Vanclief has often cited the potential of growing cancer drugs in tomatoes and other crops as the future of farming.

But such advances will also introduce potential toxins to farmers' fields that the industry will have to keep out of the food chain, Westfall said. "Basically, the companies and the government will be placing a bet that it is not an allergen," he said.

But consumers will not accept drugs in plants if they are not convinced the government or the industry are able to keep them out of the food supply, he warned.

Already, 70 per cent of Americans told a Reuters poll last year that GM foods should be treated with caution.

"These polls were taken prior to the StarLink controversy, which, almost certainly, has increased over-all concern and confusion about the safety of foods containing transgenic crops," the study reads in sample pages released on the Internet.

A wheat researcher at Washington State University also warned this week that StarLink may slow development of GM grains expected by 2003. "StarLink was a wake-up call for us," James Cook said during a panel discussion at the American Farm Bureau Federation convention Sunday. "Because of StarLink, science has really had to clean up its act."

Ellen Terpstra, president of the USA Rice Institute, told the same meeting that Aventis may hold off on the release planned for 2003 of its genetically modified rice.

"In the wake of StarLink, Aventis has assured the industry it would not release (the rice) if the market was not ready for it," she said. StarLink, made by drug and agriculture giant Aventis and engineered to repel pests, was not approved for human consumption because regulators feared the corn could cause allergic reactions.

But traces of StarLink corn were discovered in grocery-store products last fall, setting off a massive recall of more than 300 brands of taco shells, chips, cornmeal and other foods. Shells containing StarLink, which has not been approved in Canada for any use, were also sold here, though they were quickly recalled.

The controversy forced Kellogg and ConAgra to shut down production lines for almost two weeks to make sure there was no StarLink in their systems. Tyson Foods Inc., the world's largest poultry producer, even refused to buy StarLink as feed as the controversy grew.

France-based Aventis said it would spend $100 million (U.S.) buying back the corn from farmers and food companies.

So far, that is the only dollar figure put on the cost of the controversy, though Aventis has extended its buyback to include non-StarLink corn grown within 200 metres of a StarLink field, saying pollen blowing from the StarLink may have contaminated neighbouring crops.

As well, lawsuits have begun to spring up from farmers who say the value of their crops has been hurt by the controversy. More lawsuits are expected from companies that have incurred huge costs to test for StarLink, shut down production lines, recall products and pay higher prices for corn proven to be StarLink free.

There have also been sales to Japan lost after shipments to the top U.S. market there tested positive for StarLink.

The companies involved in such fallout from the StarLink controversy will be looking to recoup their costs, Westfall said.

"The litigation has only just begun."

While reluctant to put a precise figure on the total cost of the StarLink controversy, Westfall said it could be "potentially" more than $1 billion (U.S) once all the lawsuits are settled.

He said food companies have not wanted to put a dollar figure on their own costs, since that could restrict how much they sue for later.

"If you file a suit for $100 million, you don't want a published report out there quoting an executive saying your costs are $10 million."

Ann Clark, a plant researcher at the University of Guelph and a fierce opponent of genetically modified foods, said StarLink could prove to be the beginning of the end for GM crops if food companies decide the costs outweigh the benefits.

"The food companies are not going to bite the bullet on this one for the industry," she said.

Calling the StarLink controversy "a blessing" for exposing weaknesses in the food industry, Clark said the problem will grow once more GM products hit the market, bringing with them even more chances of contaminating the food supply.

"Imagine that instead of just one food product, you've got dozens."

Aventis, which until the StarLink controversy had refused to follow the industry trend of separating drug and agricultural operations, cut its farm unit loose soon after the StarLink controversy, leaving it as a separate company to face the mounting lawsuits alone.

But for Westfall, the real impact of StarLink is not likely to be the cost of the mistake itself, but the public relations damage caused by the controversy and the cost of making sure it doesn't happen again.

Aventis has asked the U.S. government to approve StarLink for human consumption, relieving it of the need to buy back the trace amounts of the corn still in the food supply.

The company has sent new scientific evidence to Washington arguing that StarLink presents no health threat.

But approving the corn now, after such strident efforts to get it out of the food supply, would be a public relations disaster, no matter how sound the scientific reasoning, Westfall said.

"What the public will hear is, `We thought this was a problem, but now we don't think it is because the companies told us it wasn't.' "

People would stop trusting government assurances of safety, just as European shoppers stopped trusting regulators after the mad cow crisis there, he said.

"You end up with this European attitude that if the government can't figure out what's right, we should just ban it all."

He said the food supply should be tightened to keep out unapproved crops. As well, food should be tested every step of the way from the farm to the grocery store to ensure its safety.

After StarLink, such measures will be needed, he said, before the public is likely to accept potentially toxic drugs being grown in farmers' fields. "It's going to be complicated and expensive, and it'll affect food prices."

Clark at the University of Guelph said consumers will not accept GM crops if the make food both potentially unsafe and more expensive. "The writing is on the wall. It's just not going to work."

Westfall, however, said GM crops may soon be so prevalent that there may no turning back, despite the cost.

"The hope of the industry is that over time the market is so flooded that there's nothing you can do about it," he said.

"You just sort of surrender."

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