Given the roots of the company, what was the attraction of biotechnology?
Why was this an area that the company chose to go into?
Monsanto has been investing in biotech since the mid- to late 1980s. The big
attraction for Monsanto was really twofold. One, we believed then, and believe
very strongly today, that fiber development and pesticides was no longer a
viable business opportunity. From an environmental point of view, it didn't
really make sense, either. So we stopped all chemical investment, and really
redirected our energy towards biotech. That was the first main thread.
The second thread, the one that really drove our company to make the biotech
investment, was a future view on food requirements. The answer that we
developed was that we believe that the world needs about 35 percent to 40
percent more food produced on every acre. Chemicals weren't the answer to that
next increment of production. It was in genetics. It was in better seed. So,
really, that's been driving us for more than ten years now. . . .
He is chief operating officer for Monsanto. In this interview Grant addresses the
issues of gene migration and pest resistance with GM crops, the refuge
strategy, the U.S. public's perception of biotech products, the lessons of
StarLink (the animal feed GM corn, which hadn't been approved for human consumption, that was found in taco shells), and the issue of
labelling GM food products. (Interview conducted December 2000.)
You're not selling the seed; you're selling something in addition to a seed,
Yes. That's true. That's been a real breakthrough in the industry--we're
selling information. When the farmer purchases Monsanto seed, or a biotech
seed, he's purchasing a piece of information that allows him to grow crops
either in a different environment, or to grow them with a reduction in the
amount of pesticides that he uses. We charge for the use of that information.
So that's a new development.
How does the transaction work for a farmer?
It's a very traditional system. When he buys seed, he also enters into a
licensing agreement with Monsanto for the use of that particular gene. The
gene contributes to his production by allowing him to control insects more
effectively, or control weeds more effectively, or, in the future, to grow a
crop that has improved qualities in terms of oils or proteins. That's a
license fee that he pays on an annual basis, and he pays depending on the use
of that seed.
And that's the intellectual property that you own, so to speak?
That's the intellectual property that we own that's quoted in that seed. To
put it in perspective, you can't force a farmer into doing something that he or
she doesn't want to do. That's been my experience around the world. We've
seen these technologies growing very quickly. These are technologies that are
generally cheaper than the existing technologies, or the historical system that
he has used in the past. They're cheaper, more effective, and reduce the
pesticide inputs. That's what, I think, has led to a very fast adoption.
What about the first few products?
The first few crops for Monsanto have been soybeans and corn, and we've done
work in rice and cotton and wheat. But the first commercial crop was soybeans.
The breakthrough in soybeans was in making the crop tolerant to an application
of Roundup, which, in turn, reduced the amount of herbicide that was applied in
the crop, and reduced the input costs to the farmer. So it was about 30
percent cheaper and more effective than any system that he'd used previously.
Then the next broad platform of technologies was insect control, and that was
insect control in corn and in cotton. BT cotton, or cotton that's tolerant to
insects, has really been a breakthrough in how insects are controlled in the
crop. Historically, the crop was sprayed eight to ten times with insecticide,
usually flown over the top of the crop. Today, the cotton crop is grown with
one or two applications, and the crop is made tolerant--the crop has a protein
coded inside it where, if bugs chew on the leaves, they're killed. So
non-target insects, bugs that shouldn't be killed, are left undamaged. . .
Now we've got this storm of activity in Europe.
Yes. I think I'd summarize it by saying we underestimated the consumer concern
in Europe. Our approach at that time, three years ago, was very largely
focused on the science, and ensuring that we had satisfied the regulatory
authorities. We never looked at the broad stakeholders involved, and I don't
think we entered into . . . a dialogue with a lot of the other non-scientific
groups involved in this discussion.
But things went very, very rapidly, and they got very far. They affected
the ability to grow and import without labels, didn't they? Did the extent of
what happened surprise you? It wasn't just a few protests in the field. It's
actually had consequences, hasn't it?
Certainly compared to last summer in Europe, it's my perception that things
have got better. They've got better because ... UK scientists are now
prepared to stand up and talk about the potential benefits of these
technologies. This isn't just about Monsanto. This is much broader. So, that
wasn't there before. That's the first thing.
The second thing--and it's a continuing frustration, not just to Monsanto, but
to the whole industry--is that there's a European regulatory system which is
running very, very slowly at the moment. It's the relative fragmentation of
that system, I think, that has led to some of the trade questions on our
ability to export crops from the U.S. into Europe.
If you compare Europe, for instance, and Japan, the Japanese system is probably
one of the best regulatory systems in the world today. . . . The Japanese
system is very similar to the system here in the U.S. You have a USDA-FDA-EPA
triangle, and it seems to work.
I think that there's a very distinctive difference between the U.S. and Europe.
At the moment, consumer confidence continues to be very high here in the U.S.
Consumer confidence in the regulatory system in Europe, in general, and the UK
in particular, is very low at the moment.
You have this very sort of exciting vision of agricultural biotech. You see
people like Jeremy Rifkin talking about a "second genesis," or people using the
phrase "Frankenfood," or Greenpeace says that there's a massive experiment
going on. . . .
I guess what I would say in response is, over the last three years, these crops
have continued to grow. There are more than 100 million acres of biotech crops
worldwide. The reality is that 2.5 million farmers in China this year will
grow BT cotton, and they'll grow it with less insecticides. I think we'll see
the same in India. I spent a lot of time in India in the last few years. You
get young people, usually women, walking through fields in a cloud of
These are technologies that can change the way that small farmers farm. So I
don't worry too much about getting caught in the crosshairs, as much as how do
these technologies advance farming techniques, and what impact we can have on
the world. I think that's how you have to focus.
Why do you think that more hasn't been made of those successes in the public
relations war? Why, for instance, do we hear about monarch butterflies, but
not about the ability of BT corn to resist infection by fungal infections?
Monsanto, in particular, and the industry in general, need to do a better job
of communicating the benefits of these end technologies. On a broader scale,
when you look at regulatory bodies, there are probably more education needs in
explaining to the consumer what biotechnology is. There are many, many very
good examples of what these technologies can bring to society at large. We
need to do a much better job of explaining what these technologies are. . .
One concern that is potentially always on people's minds--food
safety--doesn't seem to be a feature of this so far.
From a food safety point of view, these are products, these are crops, these
are technologies that have been more widely tested than any other food product
that came before them in history. They are very, very widely tested--not just
here in the U.S.--but in Japan, and even in Europe. If you look at some of our
most recent technologies, they are moving through the scientific regulatory
system in Europe with flying colors at the moment. The debate is moving away
from food safety. I think the debate is moving, now, particularly in Europe,
toward one of environmental impact, and about planting these seeds in other
parts of the world.
How would you test for allergenicity and toxicity?
There's a whole battery of tests generated around allergenicity. Monsanto's
first product, Roundup Ready Soybeans, has been extensively tested for
allergens and food allergens. It passed all the food allergen tests here in
the U.S., and in Japan, and, incidentally, passed all the allergen tests in
Europe four years ago. So despite a lot of the discussion at the moment, the
soybean products have been in public commerce for almost five years. There are
very, very wide degrees of testing.
On the environmental issues that are raised, which go to the planting of
crops and so forth, there are two issues that anti-GM groups touch on. One is
gene migration, and the other is resistance. . . . How do you address a
concern like gene migration?
When we look at growing these crops, what I've seen in terms of environmental
impact varies, depending on where you are in the world. The discussion is the
U.S. is a different discussion from the discussion in Europe, for instance.
The European discussion is largely driven by the fact that agriculture in rural
areas and leisure areas are intermingled.
If you look particularly at the UK, the UK government has asked for additional
specific tests on the environmental impact within a UK context. I feel fine
about that, because of crop rotations, because of the crop separation, and
establishment of barriers. Finally, and most importantly, the highest level of
pesticide use in the world today is in Europe. In the areas where . . . most
of Europe's wheat is grown, the crops see eight to ten applications of
fertilizers and pesticides in the growing season. Potentially, in the next
three to five years, the introduction of biotech into these crops will reduce
pesticide use. Potentially--that's what tests need to establish--biodiversity
will improve. So as I look at some of the questions around biodiversity, I'm
really interested in getting the trials done. My frustration is in not being
able to generate the trials and the scientific data.
Is that because there's now sort of a moratorium in effect in many countries
Well, it's less the moratorium, because the moratorium permits field trials.
It's more the destruction of field trials. A lot of the groups who are
advocating more information and more scientific study are synonymously the
same groups that are destroying the trials that generate that. . . .
The other issue, which some groups, and organic farmers in particular get
upset about is the idea of resistance. Because you're using BT, which is
something they feel they own, and they're worried about increased capacity for
Resistance is something that we take very, very seriously. We've made
investments in these technologies for a decade, so it's in our interests to
make sure that they'll last for another 10 or 20 years. We've developed BT
technologies. We've worked very, very closely with the regulatory systems here
in the U.S., and now in Asia, China, and India, to guarantee that we have built
natural refuge systems where we can ensure that there's no buildup of
resistance. That's the first leg of the strategy.
The second leg is that we're constantly looking for new genes, so that we
continue to present the insect populations with additional challenges to avoid
the buildup of resistance. But it's something that, as a commercial
enterprise, but also as a farming community, they take very, very seriously.
Nobody wants to go back to spraying ten applications of insecticide. They're
growing a cotton crop in Australia in some areas that they couldn't grow cotton
before, because the insects had developed resistance to synthetic insecticides.
So there's a community around the world that's very focused on avoiding the
buildup of resistance.
The refuge strategy depends on sort of compliance. Does the EPA require you
to make sure the farmers grow the refuge? . . .
We set a contractual obligation with growers, when they buy our seed, to
maintain refuges. That is monitored closely, and it's to the extent now in the
U.S., that if a farmer does not abide by that refuge program, we refuse to sell
him seed that second year. . . .
What about the issue of labeling?
Labeling is an interesting discussion. Let me tell you the Monsanto view on
labeling today. We believe very strongly, very strongly, that these products
are safe. And in their safety, there is no need to label, and that's the
position that has been held by the FDA. The FDA labeling requirements are
really triggered by, if a product is essentially the same, then there is no
In other parts of the world--again, in Europe, and in some emerging in
Asia--labeling is a requirement, and we obviously follow those labeling
requirements. If you take somewhere like the UK, the average supermarket in
the UK today has 20,000 to 25,000 products or lines. Many of those today are
labeled as containing a biotech or modified soy protein, and have been labeled
for the last three years. The data that I've seen suggests that that hasn't
changed consumer behavior at all. . . . And that would certainly be the case
in Holland, which had blanket labeling regulations way before the UK.
My final point is that I think a voluntary labeling scheme here in the U.S.
leads to food companies generating an extra expense by labeling. A consumer is
presented with that expense in terms of a price, I would assume. The consumer
learns the choice, and whether to select that product, and pays the premium
associated with it. I think we'll probably see some form of voluntary labeling
program emerging here in the U.S., in the future, in some select products.
You're saying mandatory labeling doesn't really make any difference. So why
not have mandatory labeling?
There's never been a requirement here in the U.S. As I said at the beginning,
I don't see the need for it, when we've run through years and years of safety
testing before these products are released. On that basis, from a consumer
point of view, there is no substantive difference. . . .
I think that there are a lot of lessons in the StarLink issue. Here at
Monsanto--StarLink isn't one of our products--we've had a number of internal
policies which would have avoided that for us. One, we would never
commercialize a product until we had food and animal feed approval. That's
just been an internal policy, because of the difficulty in separating. So we
would never go forward until we had both approvals. That's one thing.
Two, we would never commercialize a product until we had approval here in the
domestic U.S. market and in Japan, because most of the export flows in
commodities go from here to Japan. We would never commercialize until we had
the secure export market established as well. I think that, for the industry
in general, StarLink has been a pivotal turning point in the recognition that
there are limits to what you can do in channeling. Before you commercialize a
product, you just need food and feed approval.
What is channeling--keeping things separate?
The identity preservation and keeping commodities separate, or trying to
maintain separate fractions in grain.
Didn't this reveal issues of farmer compliance? In practice, it's turned
out to be quite a nightmare, hasn't it? They had rules that weren't
necessarily being followed. Is it simply very, very difficult to make rules of
that complexity stick?
I can't comment on what Aventis has done on their compliance. I can tell you
what we've done here in the last couple of years in our channeling efforts. We
audit every step in the process, and we're working this through web sites,
through direct farmer communication, and all the way to the processors and
receivers of that grain. But I think the broader view in this is, one, making
sure that you have your export markets secured and clearly identified before
you commercialize; and two, making sure that you food and feed approval before
you take these products to market. . . .
Why are you giving away your intellectual property, or allowing the use of
your intellectual property on the "golden rice," for instance?
We successfully mapped the rice genome earlier this year, and surprised many
scientists around the world by opening up access to that genome. So today you
can access the whole mapped rice genome, free of charge. Whether you're in
Beijing as a plant breeder, or whether you're in Bangalore, you can access the
Monsanto rice genome and use that as a platform for additional research. . . .
I think it helps society. It helps the rice crop--a third of the world still
depends on rice as their daily staple. And in the long term, it potentially
could help us by gaining further insight into the genetic makeup in rice, and
through rice, into wheat and corn. . . .
The reality is that 24,000 people a day still die of hunger. The majority of
that 24,000 are children. I believe that for corporations like Monsanto going
forward, we've got a responsibility in how we use these technologies to benefit
people that are less privileged than the West is today. So, golden rice, and
recently announced golden mustard, provide a vitamin-enriched basic food source
that helps prevent night blindness. It also makes contributions by
strengthening the immune system that makes children less predisposed to immune
diseases like AIDS. These are things, that three years ago, we as a company
would never have considered. . . .
Are you doing it because of the bad publicity? Or do you see this as a new
model of the price of doing business in the twenty-first century? . . .
We are doing this not because of PR, and sometimes when we make these gifts,
that's the first question. What we have seen today after a few months with the
rice genome work and after a few months between Monsanto and Zenica with golden
rice, is a recognition that this is a genuine gift given in good faith. And
given the gift, it then allows people to make additional scientific
developments without Monsanto being involved. I think that's the key. We give
the gift, and then it's up to the recipient to develop it. So for us, there's
no additional work required, other than making sure that it's a gift given in
good faith. . . .