Monsanto's ‘admission' has business motives?

The step is believed to have been taken to promote its second generation Bt cotton

Biotech crop giant Monsanto seemed to admit failure with Bt cotton last week, but a government analysis says it looks more like a smart business strategy.

On March 5, the Indian subsidiary of the company announced that its first generation Bt cotton was ineffective against the pink bollworm pest in parts of Gujarat. An internal analysis of the statement of the Ministry of Environment and Forests says it “appears that this could be a business strategy to phase out single gene events [that is, the first generation Bollgard I product] and promote double genes [the second generation Bollgard II] which would fetch higher price.”

In fact, while releasing its own statement, Monsanto India had suggested that Indian farmers switch to Bollgard II, which would delay resistance further and reduce the need for insecticide sprays. It claimed that 80 per cent of Indian cotton farmers would plant the second generation product in 2010.

Activists and agriculture scientists had denounced the company for pushing farmers toward a costlier product, which would not actually have any new toxin to fight pink bollworm.

Now the government also seems to be questioning Monsanto's motivation. “Monsanto may not have any incentive to continue with single gene event as payment of royalty to the company is sub judice ,” said the Ministry analysis.

The Supreme Court had ordered Monsanto to sell first generation Bt cotton seeds at a reduced price until the issue of royalty is resolved. “Switching to Bollgard II will not only fetch higher trait fee, but will also leave the competition, which as of now has only single gene products, further behind,” they said.

Interestingly, the U.S. Justice Department has launched an anti-trust investigation against Monsanto, which controls over 90 per cent of the market for biotech crops worldwide. In the U.S., the first-generation of its genetically modified soybean seed will lose its ability to draw royalties after 2014, and reports suggest that Monsanto is trying to get farmers to switch to a patented second generation of seed instead.

The Union government seemed to have been taken aback by Monsanto's statement last week. It received an interim report from Monsanto's Indian partner, forwarded by the Central Institute of Cotton Research (CICR) just two days earlier. The Ministry found it “a bit puzzling” that the company had made the statement without even consulting the CICR, which is responsible for post-release pest monitoring.

The Ministry's analysis also raises questions about Monsanto's laboratory tests and its conclusion that the pink bollworm has developed resistance to the product. The CICR feels Monsanto's methodology is “flawed.”

The government now plans to convene a meeting of all Bt technology developers and scientists from the CICR, the Indian Council of Agricultural Research, the Indian Agricultural Research Institute and the Ministry of Agriculture, to investigate the Monsanto report. It also plans to convene a meeting of Chief Secretaries to curb illegal production of Bt cotton seeds.