Terminator Seed Lands Monsanto's Shapiro with Egg, Pie on Face
By John K. Wilson • Bankrate.com

Monsanto CEO Robert Shapiro has seen the future, and it is made of pie.

He saw it a little too closely in October 1998 when Agent Custard and Agent Lemon Meringue (not their real names) of the pie-throwing Biotic Baking Brigade tossed a vegan tofu creme pie in Shapiro's face (the sweet potato pie missed).

If Shapiro hadn't realized that biotechnology can act as a lightning rod for controversy, the pie offered a tasty reminder.

The troubles for Monsanto and Shapiro have continued this year. Even worse than the pie was the baby food spit in his face, if only symbolically.

In August, Gerber announced that it would no longer use genetically engineered products in its baby foods, followed soon after by Heinz.

And before the baby food, it was the butterflies: a Cornell University study made headlines in March because it found that Monarch caterpillars frequently died if they ate milkweed leaves sprinkled with genetically engineered corn pollen.

Monsanto has found itself in a defensive mode, offering up spin control. In October, Monsanto -- which made $49 million on $1.9 billion in sales during its third quarter -- announced that it would abandon its controversial "terminator technology," a form of genetic engineering that makes second-generation seeds sterile. And Shapiro himself has admitted that genetic engineering is a radical step: "Almost everything we grow, everything we eat is the root result of human intervention, breeding, and so on. But this is unnatural in a different sort of way from the kinds of breeding programs that have characterized humanity for thousands of years."

The moral, environmental, and scientific dimensions of this debate do not interest Wall Street, but the fact that there is a debate at all must trouble Monsanto shareholders who imagined ballooning profits as the company that brought us PCBs now tries to get rich feeding the world.

The world has not proven grateful, however. Activists in India have burned genetic engineering test sites, and Europe has also been skeptical of "the Second Green Revolution" as U.S. Department of Agriculture Secretary Dan Glickman enthusiastically calls it. A $1.5 million campaign by Monsanto to convince European consumers of the value and safety of genetically engineered foods failed miserably, and resistance is strong from supermarkets that have banned genetically engineered products from their shelves, activists who protest the biotech industry, and vandals who destroy test fields. Analysts from Deutsche Bank have issued reports on Genetically Modified Organisms (GMOs) bluntly titled "GMOs are dead" and "Ag Biotech: Thanks, But No Thanks," predicting that "GMOs, once perceived as a bull case for this sector, will now be perceived as a pariah."

Of course, Americans don't care what Europeans think, but American farmers care about what they buy. It's estimated that in American fields this year, 57 percent of the soybeans and 38 percent of the corn planted used genetically engineered seeds to increase pest or pesticide resistance. But farmers were shocked when grain buyers such as ADM announced shortly before harvest that they wanted the genetically engineered crops kept separate from the non-genetically engineered plants. The move came after U.S. corn sales to Europe dropped from 70 million bushels in 1997 to just 3 million in 1998 due to European restrictions. U.S. agriculture experts expect that in next year's crops, genetically engineered planting will drop between 20 percent and 60 percent.

This is a heavy blow to Monsanto, but the company may end up stronger in the end. If the protests scare away competition and genetically engineered crops weather this storm, Monsanto will be the reigning force in biotechnology.

The company has taken matters into its own hands, having organized a counter-protest against the environmental protests. The New York Times on Dec. 8 reported that Monsanto partially funded a demonstration by 100 members of the Mount Lebanon Baptist Church of Washington, DC against anti-Monsanto protesters dressed as seed-damaged monarch butterflies. According to the article, some of the Mount Lebanon protesters received remuneration -- 25 bones each! -- from the company. Larry DeNeal, one of the organizers of the Mount Lebanon group, declined comment for the church.

Protests and religious groups aside, the future of Monsanto and genetic engineering rests squarely on the American consumer. The World Trade Organization, with its unrelenting devotion to free trade, may eventually respond to U.S. demands and force Europe to accept genetically engineered foods without discrimination or labeling. But there's a growing movement in America to require labeling on these products, which, if successful, would make it impossible to push the issue in the WTO.

That's one reason why Monsanto spent $2 million on Washington lobbyists in the first half of 1999 and recently hired Griffin, Johnson, Dover & Stewart Inc., a firm that features Patrick Griffin, Clinton's former chief congressional lobbyist, and David Johnson, former director of the Democratic Senatorial Campaign Committee.

Monsanto also knows how to play hardball: a Florida Fox news station killed a report on a genetically engineered growth hormone used on cows to produce more milk after Monsanto threatened "dire consequences."

Journalists Jane Akre and Steve Wilson, who were fired by Fox for refusing to change their report, have filed a lawsuit over the issue. Monsanto has also fought efforts to allow labeling of rBGH-free dairy products.

But the tide may be turning. U.S. environmental groups have amassed hundreds of thousands of signatures on petitions demanding labeling of genetically engineered foods and Rep. Dennis Kucinich (D-Ohio) has introduced a bill to require labeling, The Genetically Engineered Food Right to Know Act, with 20 co-sponsors (including four Republicans). Forty-seven members of Congress have also asked the FDA to require labeling of genetically engineered foods.

Last month, the Food and Drug Administration held its first public hearing on genetically engineering food in Chicago. The response to the hastily arranged event was so overwhelming that most of the audience had to watch via satellite from a hotel a mile away. Additional hearings will be held in Washington D.C. and Oakland, Calif.

The Chicago public hearing was deeply polarized, with consumer advocates and environmentalists demanding more regulation and labeling of GE foods, while industry officials strongly supported the current regimen of weak FDA oversight. The media proved to be more interested in a protest outside organized by Sustain USA and Greenpeace, which featured a protestor dressed as genetically engineered corn killing Monarch butterfly-costumed children and a mad scientist injecting a cow with recombinant Bovine Growth Hormone.

With rumor mergers swirling around Monsanto, biotechnology could represent the next wave of fast-rising tech firms, or an industry that faces a severe drought until consumers are convinced of the safety of genetically engineered foods.

For the moment, Robert Shapiro is keeping his eye out for flying pies.

-- Posted: Dec. 9, 1999