Market News & Headlines >> Cargill Sues Syngenta Over Corn Rejections
Top U.S. grain exporter, Cargill Inc., has filed a lawsuit against a unit of Syngenta AG in a Louisiana state court seeking damages resulting from China's rejection of U.S. corn shipments containing Syngenta’s genetically engineered Agrisure Viptera corn, which Cargill said had cost the company more than $90 million.
Cargill’s grain export facilities in Reserve and Westwego, Louisiana loaded the vessels that were destined for and rejected by China.
Minnesota-based Cargill accuses Syngenta Seeds Inc. of exposing the grain trader to losses by selling the seeds to U.S. farmers before the Swiss company had secured import approval from China, a major buyer, for the new insect-resistant corn variety, also known as MIR 162. MIR 162 corn can be found throughout the U.S. corn supply, effectively closing the lucrative Chinese market to U.S. supplies, the lawsuit said.
Since mid-November 2013, China has rejected imports of U.S. corn due to the presence of Syngenta’s MIR 162 trait because of its lack of approval for import. A study by the National Grain and Feed Association (NGFA) estimated that U.S. exporters and farmers lost up to $2.9 billion because of the uncertain trade environment.
Cargill is suing Syngenta for negligence; knowing, reckless or willful misconduct and unfair trade practices. The lawsuit seeks to hold Syngenta responsible for "deliberate, knowing and continuing contamination of the U.S. corn supply with a product that it understood all along would substantially impair the U.S. grain industry's ability to sell corn and other commodities to buyers in China," according to Cargill's filing.
Mark Stonacek, president of Cargill Grain & Oilseed Supply Chain North America, said the lawsuit was filed only after talks with Syngenta proved unproductive. “This issue is important to U.S. agriculture,” Stonacek said. “Marketing MIR 162 before receiving approval from China closed off that significant export market to U.S. farmers and exporters. Cargill believes that Syngenta continues to not accept its role in shared responsibility by moving ahead this year with the commercialization of Duracade, which also is not approved in China and other key export markets.” Syngenta’s Agrisure Duracade is a corn variety engineered to protect against corn rootworm.
Syngenta said in a statement that it believes the lawsuit is without merit and “strongly upholds the right of growers to have access to approved new technologies that can increase both their productivity and their profitability.”