MON Monsanto Company (delisted)

By Jacob Bunge 

European Union officials approved a new Monsanto Co. biotech soybean, allowing the beans to be imported but not grown in the region's farms.

The ruling removes uncertainty for Monsanto, which already had sold the seeds to U.S. farmers this year, and for grain companies. Some grain traders had refused to purchase the soybeans from farmers without approval from the EU to import the crop once it had been grown.

EU officials said the soybeans had "gone through a comprehensive authorization procedure," including a scientific review by the European Food Safety Authority. The authorization lasts 10 years.

St. Louis-based Monsanto said Friday it plans a full U.S. launch of the new soybean seeds and a related herbicide next year, pending U.S. regulatory approval for farmers to use the new herbicide with the soybeans.

The "Roundup Ready 2 Xtend" soybeans are genetically modified to resist a powerful combination of herbicides, and have been touted by Monsanto as a potential blockbuster at a time when slumping crop prices have withered profits for the seed company and for farmers. The company has estimated it will sell 15 million acres' worth of the seeds in the U.S. in 2017.

Monsanto sold relatively small quantities of the soybeans this spring to farmers in the U.S. under the assumption that EU officials would approve them on a similar time frame to prior biotech seeds the company had submitted.

But the EU continued its review for months, while member states debated whether to reauthorize the herbicide glyphosate, which Monsanto markets under the Roundup brand. The European Commission, the EU's executive arm, last month reauthorized glyphosate for 18 months after member states couldn't agree on a longer-term extension.

Without EU approval, some major grain-trading companies, like Archer Daniels Midland Co. and Bunge Ltd., said they wouldn't buy the Monsanto soybeans from farmers after they were harvested this year, for fear that some of those soybeans could erroneously wind up in EU-bound shipments and get rejected by import officials.

An ADM spokeswoman said with the EU's approval "our grain elevators and processing plants are now permitted to receive these beans." Bunge didn't comment.

Companies that buy, trade and process crops have been on guard for potential trade disruptions stemming from unauthorized biotech seeds after China began turning away some U.S. corn shipments in late 2013, citing a variety of pest-resistant corn developed by Syngenta AG that had yet to be approved. Grain companies claimed tens of millions of dollars in losses from the episode.

Monsanto still needs approval from the U.S. Environmental Protection Agency that would cover some applications of a more-powerful weedkiller, a combination of glyphosate and dicamba, that was designed for the company's new soybeans.

The EU on Friday also approved another variety of Monsanto biotech soybeans that produce healthier vegetable oil, as well as a herbicide-resistant variety developed by Bayer AG. The approvals allow the soybeans to be imported into the EU, but not cultivated. Biotech corn is grown only in very limited quantities in some EU countries, and more than half of EU member nations have moved to bar genetically modified crops from being grown within their borders.

Write to Jacob Bunge at jacob.bunge@wsj.com

(END) Dow Jones Newswires

July 23, 2016 02:48 ET (06:48 GMT)

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