At a Chinese summit on agriculture and food on Monday, China’s agriculture minister Han Changfu was reported to have said that he would approve the importation of Monsanto’s (MON) Intacta soybeans. The product is genetically modified to resist insects, and neither China nor Monsanto have made official statements on the matter.
China’s enormous population is a prize highly coveted by large companies from just about every industry, and the news sent shares spiking over 4 percent to $106 shortly before Tuesday’s close. The Intacta soybeans are already set to be released in Brazil next year and Argentina the year after, and are expected to be one of Monsanto’s premier growth products going forward.
Meanwhile, the company solidified its increasingly problematic reputation in the U.S. when an appeals court dismissed efforts by domestic organic farmers who were seeking to stop the Monsanto from suing them in the event that the its patented genetics make their way into organic crops.
A Federal Circuit Court of Appeals decided that organic growers had no need to legally block Monsanto from suing them, saying that the company’s pledge not to sue smaller farmers that can be found on its website is both sufficient and binding. Since 1997, however, the company has sued nearly 150 growers for patent infringement after their crops were unwittingly contaminated by its own bio-engineered crops. In each case, Monsanto has sought and often won judgments who it said used their seeds without paying royalties.
According to one of the plaintiffs in the suit, Andrew Kimbell of the Center for Food Safety, the ruling will likely be appealed.
The litigation comes on the heels of a suit filed by Washington State wheat growers last Thursday, who claim that Monsanto’s unauthorized release of genetically modified wheat, discovered in an Oregon field earlier in the week, has negatively affected exports. Pacific Northwest wheat farmers export almost 90 percent of their crop to Asia, where the news has caused Japan to suspend some imports, while South Korea has vowed to ramp up inspections.
Earlier last week, a Kansas farmer also filed a class action suit against the company for similar reasons.
Monsanto has a market cap of nearly $56 billion, and shares trading in a 52 week range between $76.89 and $109.33. The company is up 13 percent in 2013, and 36 percent over the past 12 months. The company’s former vice president Michael Taylor was in 2009 appointed by President Obama to the post of senior advisor to the Food and Drug Administration, a move that drew sharp criticism from the President’s typically indulgent supporters.
Furthermore, a peer reviewed European Union study released late in 2012 provided yet more evidence that genetically modified foods could very well have health risks for consumers. Rats fed with GMOs for long periods were shown to develop tumors and other complications. Monsanto has never studied the effects of its products on humans or animals.
Shares for Monsanto pulled back 1.3 percent on Tuesday, more or less in keeping with a market-wide drop in stocks.