Assessment of Biotechnology Policies and International Trade in Key Markets for U.S. Agriculture

Japan's Biotech Policies

Japan, the number two importer of U.S. agricultural products, is also the largest importer of U.S. corn, importing 33% of total U.S. corn exports in 2003 (USDA-FAS 2005b). Since the mid-1990s, Japanese consumers have expressed their increasing concerns regarding the safety of biotech products (USDA-FAS 2000). On May 1, 2000, the Japanese Ministry of Agriculture, Forestry, and Fisheries (MAFF) released its biotech food labeling regulation "Mandatory Labeling of Genetically Modified Foods and Foods Containing Allergens." This regulation includes two key points: (1) "importation and sale of these foods are legally prohibited if they have not been assessed for safety by the national government" (administered by the Japanese MAFF) and (2) "labeling is legally required as well as safety assessment" (Japanese Ministry of Health, Labor, and Welfare). This bill requires 24 foods made from corn and soybeans to be labeled for their biotech ingredients (USDA-FAS 2000, 2001a).

On February 22, 2002, the Japanese MAFF announced further revision of its biotechnology labeling regulation to include biotech potato products (USDA-FAS 2001c). The Japanese MAFF also set 5% as an unofficial tolerance level for biotech content. As of December 2002, the Japanese Ministry of Health, Labor, and Welfare had approved 44 biotech varieties for food use (USDA-FAS 2003a).

"On April 1, 2003, new legislation went into effect making a feed safety assessment mandatory. As part of this regulation, MAFF has set a 1% tolerance level for the unintentional commingling of biotech varieties in feed which are approved in other countries but not yet approved in Japan. In addition, the exporting country must be recognized by the MAFF Minister as having a safety assessment program that is at equivalent to or stricter than that of Japan" (USDA-FAS 2003a).

EU's Biotech Policies and Their Impacts on U.S. Agricultural Exports

As shown in Figure 3 (USDA-FAS 2003c, d, 2004a), the EU began to consider agricultural biotechnology regulations in the early 1990s. At that time, the EU had already approved nine biotech varieties, including corn, soybeans, and oilseeds. However, the approval process became progressively more difficult and politicized. Since the late 1990s, the EU's agricultural policies have begun to undermine agricultural biotechnology development and trade. Six EU member nations (Austria, France, Germany, Greece, Italy, and Luxembourg) have banned imports of biotech corn and rapeseed that had been approved by the EU. In addition, the EU Commission refused to challenge these illegal bans (USDA-FAS 2003c).

In 1998, EU member states began blocking new applications for biotech products. According to the U.S. Department of State, "This approval moratorium is causing a growing portion of U.S. agricultural exports to be excluded from EU markets." In late 1998, the European Union imposed a five-year de facto moratorium on approving new biotech varieties, which effectively prohibited most U.S. corn exports into Europe (USDA-FAS 2003d).