South America Calling

Brazil Soy Industry, Monsanto to Renegotiate Royalty Collections

Brazilian soybean crushers and exporters are preparing for another round of negotiations with Monsanto over the collection of royalties on their Intacta RR2 Pro bean technology.

Last year, the biotech giant pressured the soybean industry into testing and collecting royalties on beans produced from seeds grown on the farm in return for fees.

But those initial deals, agreed individually with each company, were generally only for 12 months and need to be reviewed.

"These deals will have to be agreed again. We are starting again," Carlo Lovatelli, president of the Brazilian Soy Industry Association (ABIOVE), told journalists.

He said the system is working at present, although it is onerous for the companies.

Monsanto's Intacta RR2 Pro has proven very successful in Brazil since it was launched commercially three years ago. Analysts estimate it will be used on something like 30% of soybean acres in 2015-16.

The majority of farmers use certified seeds, on which royalties are paid on purchase. However, Aprosoja Brasil, a soy and corn growers' group, estimates that around 30% of soybean farmers utilize at least some home-produced seeds each year.

The soy industry and Monsanto spent months negotiating the issue in 2014 and early 2015 before the industry finally caved.

"It is frustrating because it is another thing we have to do that isn't part of our main business," said Lovatelli.

Lovatelli noted that other companies are now developing technology similar to the stacked glyphosate and caterpillar-resistant Intacta, and a new system of charging royalties on second-generation GMO beans needs to be created.



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