The Post-Staples State: The Political Economy of Canada’s Primary Industries



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Chapter III: “The New Agriculture: Genetically-Engineered Food in Canada”Elizabeth Moore29 (Agriculture and Agri-food Canada)




Introduction


Policy making in Canada in response to the development and sale of genetically-engineered (GE) food rests on a foundation of enthusiasm for technology in agriculture. In this aspect and others, the first wave of GE food policy, developed in the 1980s and 1990s, is consistent both with agriculture’s current status as a mature staples sector and longstanding policy legacies. As the twenty-first century unfolds, however, the evolution of the policy context for GE food is creating potential for heightened post-staples sector pressures and there is evidence of the adoption of post-staples strategies. Looking toward the future, both the impact of GE technology on the broader agri-food sector and the policy response to it may be important factors in determining whether and when agriculture becomes a post-staples sector.

The first wave of GE food policy in Canada was influenced strongly by the contextual characteristics that confer a mature staples status on the agri-food sector. Government funding for technology development, the positioning of Saskatoon as an agri-food biotechnology centre, the Canadian Biotechnology Strategy, the 1993 federal biotechnology regulatory framework, and specific federal environmental and food safety measures regulating GE food are policy measures consistent with a mature staples sector within a competitive state. As the foundation of GE food policy, these measures promote technological solutions to economic problems, place a priority on competitiveness, are cognizant of the export dependence of key commodities, and have been influenced by pressures from environmental groups.

While GE food policy sits comfortably within the mature staples context of the agri-food sector, some of the pressures and strategies associated with the transition to a post-staples sector are arguably also present. GE food policy making in Canada in the 1980s and 1990s was more responsive to the concerns of rural staples communities and the agri-food industry than to urban communities, taking urban interests as a proxy for consumer concerns. Pressure from Canadian and international non-governmental organizations skeptical of GE technology to alter GE food policy remains constant, however, and consumer resistance at home and abroad continues to complicate matters. Further, while GE food policy has always been influenced by factors outside Canada, the mix of external factors influencing GE food policy appears to be changing as consumer and environmental concerns become more prominent and influential in policy making. . In response, policy revision into the 21st century has been more reflective of consumer concerns, with an emphasis on increasing accountability and transparency. Emerging GE food applications appear likely to heighten the post-staples pressures that are already visible. Their impact on the economic characteristics of the agri-food sector, consumer reaction to them, and the government’s policy response will influence whether agriculture remains a matue staples sector.


The first wave of GE food policy: a mature staples context


The enthusiastic embrace of genetic engineering by Canadian policy makers and much of the Canadian agri-food industry continues a longstanding practice of applying technology to agriculture in the hope of sustaining and increasing profitability. As expected in a mature staples sector, that technology has become more capital-intensive in recent decades. Genetic engineering is part of this capital-intensive trend and, in the private sector, comes with a significant dependence on intellectual property rights to attract and hold that capital investment. Genetic engineering brings high costs and requires an extensive knowledge base. Its integration into Canadian agri-food research has encouraged policy change aimed at facilitating public-private research partnerships that can pool financial and technological resources.

GE food policy making has also been framed by the larger context of the competitive state and the economic issues of the agricultural sector including competition from the rise of low-cost producers such as Brazil (see Skogstad chapter). In fact, the emergence of GE agricultural applications coincided with the development of the new competitiveness model in Canada, with both coming to prominence in the late 1980s. This model places a premium on securing international competitiveness to ensure economic growth. It embraces the concept of the knowledge economy in which GE technology is expected to play a central role (Abergel and Barrett 2002, Moore 2000) and promotes diversification away from traditional economic activities that are perceived to be in decline. In the early 1980s, the federal government made genetic engineering a strategic priority within this new competitiveness model and heavily promoted its promise in many areas, including medical and agricultural applications.

Through the 1980s and 1990s, as the development of GE food crops for commercial use progressed, the Canadian federal government was pursuing technological and market-based / driven solutions to economic challenges, consistent with the competitiveness model. For example, within Agriculture and Agri-food Canada, agricultural research policy shifted toward a more market-driven approach in the late 1980s and early 1990s (Moore 2002). This approach was conducive to GE agri-food research efforts by giving plant biotechnology firms greater influence on the research agenda and providing plant breeders’ rights (PBR), a form of intellectual property rights. The focus on creating a competitive regulatory regime and selecting market-based instruments in GE food policy was also consistent with the desire to move away from policy instruments, such as subsidies, that were under fire as a result of the priority placed on deficit reduction and trade regime obligations.

GE food policy has also been clearly designed with an eye on the international context. The first wave of policy development was influenced by the international economic issues of trade and foreign investment. It was considered essential to align key policy measures with international trading partners and competitors and to develop a policy regime attractive to the multinational firms that dominated private sector plant biotechnology. Further, the high degree of export dependence of some Canadian agri-food products arguably provided a stimulus to facilitate initial adoption of the technology (GE canola) based on the belief it would contribute to competitiveness with better yields and made it a priority to align policy decisions, particularly regulatory, with both competitors and key import markets.

Environmental politics were also somewhat influential during the first wave of GE food policy development, ensuring a precedent-setting precautionary policy approach. The environmental effects of GE food have the potential to be both positive and negative. Genetic engineering is not a direct response to resource depletion, but offers potential solutions to the need to improve the economic viability of agriculture and reduce environmental degradation. However, GE food is also seen as contrary to the stewardship goals of the organic industry and, due to the issue of contamination, a serious potential threat to the continued viability of some parts of the organic industry. Several environmental groups are also concerned about risks to ecosystems.


Jumping on the bandwagon: investment in GE food technology


Mature staples characteristics combined to create a favourable environment for public and private investment in GE food technology. In the late 1970s and early 1980s, speculation about the potential benefits of applying genetic engineering to agriculture began to grow. The impressive theoretical possibilities of genetic engineering fuelled excitement and controversy, with the concept that a trait in one organism could be isolated, and then transferred to, and expressed in, any other organism. The term genetic engineering is used in this chapter to refer to these recombinant DNA techniques. The term “biotechnology” is also used in this chapter, given its frequent use within the GE food policy community and for statistical purposes, although it is a broader term that can be considered to encompass other techniques resulting in genetic modification such as mutagenesis.

The economic uncertainty that has been a pervasive aspect of crop production historically in Canada has heightened the appeal of new technologies that promise improved returns and competitive advantage. Into the 1980s, agricultural biotechnology appeared as a bright light on the horizon, as producers became preoccupied with falling land values and grain prices, and a global agricultural subsidy war. Both the historic embrace of technology and the immediate context of the 1980s help to explain the federal government’s choice to facilitate the adoption of genetically-engineered (GE) food crops. GE crop plants are one of the earliest large-scale applications of biotechnology to the agri-food sector. Globally, the first GE plant varieties were developed in the early 1980s. As a result, this chapter focuses primarily on GE crops.

The federal government played a leading role in creating Canada’s pioneering status in the commercial adoption of GE food crops, by working on and funding their development, and later by providing a regulatory framework designed to facilitate commercialization. This proactive role was formalized through the 1983 National Biotechnology Strategy (NBS). Its goals included creating a robust research infrastructure to capture economic and social benefits. The NBS provided federal funding for public and private research on GE crops plants. The National Research Council (NRC) was given the mandate to act as lead federal agency on biotechnology research. Its Prairie Research Laboratory in Saskatoon was renamed the Plant Biotechnology Institute in 1983.

The integration of genetic engineering techniques into plant breeding programs was pursued in public agricultural research centres. In 1983, the total Canadian crop effort in crop biotechnology was estimated at one hundred “person-years”, including 50 permanent scientists, and more than 90 per cent of this effort was based in the public sector (CARC 1983). By 1998, an AAFC official estimated that the department’s Research Branch was allocating about twenty-five per cent of crop research resources toward biotechnology-based projects, or about $25-million (Cdn) a year. In 2001-2002, AAFC spent $64-million on biotechnology research, eighteen per cent of its total expenditures on science and technology, and virtually all of it conducted within the department (Canada. Statistics Canada 2003a).

By the mid-1990s, the combination of policy innovation in federal agricultural research and the lucrative potential of genetic engineering had prompted significant growth in private investment in GE crops. One example is the breeding of new canola varieties where private varieties now outnumber public varieties. Private investment in biotechnology research and development in the Canadian agri-food sector was $36.8-million in 2000 (Canada. Statistics Canada 2003b), marking notable growth but still much smaller than AAFC’s effort.

Into the twenty-first century, the focus has shifted from biotechnology to genomics, the research foundation of genetic engineering. Genomics gathers and analyzes genetic information, including genome characterization and sequencing. Genome Canada, established by the federal government, has funded six agricultural projects. In the 1999 federal budget, $55-million was provided for genomics research over three years, including $17-million for crop genomics in AAFC (canola, wheat, corn, soybeans) and $17-million for the NRC. One-third of the NRC funding was intended to go to agricultural crops, focused on canola. However, while rapid progress is being made in sequencing genes, the timeframe for understanding the functions of these genes is expected to be much longer. This significant public and private investment in GE food technology in Canada is most visible in the agri-biotechnology centre created in Saskatoon, contributing to the viability and diversification of the city as a regional economic centre. For example, spending on agricultural genomics research in Saskatoon was estimated at $120-million in 2003 (AgWest Biotech 2003). Saskatoon hosts the world’s largest research program in animal health genomics, at $27.5-million, and a large AAFC / NRC plant genomics project at $21-million.



Regulation as a tool for promotion and protection


By the mid-1980s, the Canadian federal government was examining regulation of commercial applications of genetic engineering. It designed regulation with the hope of achieving both promotion and protection simultaneously. Environmental safety issues include concerns that GE plants could become “superweeds” or have other adverse impacts on biodiversity through gene escape by transferring their traits to wild relatives. In food safety, concerns focus on how genetic engineering might alter levels of allergens, toxins, or nutrients. For labelling, debate revolves around what consumers need to know compared to what they might like to know about the origin of food ingredients. Labelling also appears contradictory to current international trade rules and raises logistical issues such as the lack of current capacity to segregate and prevent contamination.

The visible financial and political commitment by the federal government to genetic engineering meant that commercialization would proceed. Regulatory policy making had to provide an adequate level of protection from health and environmental risks, but ultimately could not jeopardize economic potential. It has been argued that in Canada, biotechnology regulation was placed in the context of international competitiveness as early as 1980 (Kneen 1992: 171-172). The intent was that assurance of safety through regulation would provide a solid basis for consumer acceptance and facilitate international trade, and achieve this by being science-based. Provinces have largely deferred to federal activity in this area, although Quebec and Prince Edward Island have both recently contemplated taking regulatory action.

In the first wave of policy making, options for regulation were limited by fundamental choices within government about appropriate goals and means as expressed within the 1993 overarching regulatory framework for biotechnology. Regulation could not impede commercialization unduly, it had to be science-based, it would rely on existing legal authorities, and be aligned with international developments. Both industry and government championed a regulatory framework that would provide a predictable regulatory climate and encourage domestic and foreign investment (Hollebone 1988).

By the late 1990s, the initial regulatory regime with its overarching framework, environmental safety and food safety assessments for GE foods, and a labelling policy was in place. For the first time in Canada, new plant varieties were potentially subject to environmental and food safety screenings. The regulatory regime placed clear boundaries around what was to be included within regulation and what was not. Acceptable goals and methods included human and environmental safety, risk-based assessment, a favourable development climate, an open consultative policy making process, and national and international harmonization. Outside the scope of regulation were ethical concerns beyond safety, using regulations as a tool to direct development toward public good benefits such as food safety or sustainable agriculture, and distinguishing GE from non-GE products through regulatory treatment.

For environmental safety, the federal government created an environmental safety approval process. The focus of regulation is on novel traits, both those created by genetic engineering and by other means. Health Canada developed a food safety assessment process, triggered when a new food product meets the definition of a novel food. As with environmental release, the scope of regulation is not restricted to GE products. Labelling is required only when there have been significant changes in nutritional level or potential allergenic or toxic effects. In 2004, a national standard for voluntary labelling was finalized.

While biotechnology skeptics have consistently criticized the regulatory regime, it is in fact precedent-setting in its precautionary approach. Regulatory development was pursued in a context when the precautionary principle was becoming well-known. As novel products created through a novel technology, GE food crops were regulated on the basis of scientific speculation and comparison to conventional counterparts, rather than in response to evidence of negative impacts, consistent with a precautionary approach (Krimsky 1991: 182). Another important outcome of regulatory development was to ensure that regulation did not discriminate against genetic engineering; this was achieved by the focus on the novelty of the product rather than the process through which it was produced. The regulatory response downplayed the novelty of the technology in terms of risks it might pose, contradicting the radical potential touted through the government’s promotional efforts. It sidestepped the issue of scientific uncertainty regarding the risks of GE crops and provided relatively little opportunity for public input on non-science-based issues. This combination of a seemingly precautionary approach with a lack of scientific and democratic legitimacy provided a relatively unstable foundation for the post-staples challenges that grew in strength in the late 1990s.



The second wave of GE food policy: post-staple pressures and responses


In 1995, Canadian producers began widespread cultivation of GE food crops. Since then, the context for GE food policy has become more challenging. The environmental and food safety risks became more concrete, providing biotechnology skeptics with more fuel. Criticism has focused on the lack of attention paid by policymakers to issues such as consumer choice, ethical issues, and the degree of scientific uncertainty underpinning the management of potential risks. Pressures external to Canada, from consumers and public interest groups in key export markets continue. Further, confidence in the benefits of GE crops has weakened within some elements of the domestic agri-food industry. Since the late 1990s, the Canadian government has acted to bolster GE food policy, focusing on reinforcing the legitimacy of regulation by building capacity and increasing transparency. It renewed its biotechnology strategy and created a new advisory committee with a broad mandate, referred the scientific issues of GE food to a Royal Society of Canada expert panel, and increased regulatory resources within the federal government. Biotechnology skeptics, however, are far from content with what they view as relatively minor revisions and efforts.

In 1995, Canadian producers began to switch rapidly to GE crops from conventional varieties, especially in canola. Globally, GE crop acreage has grown from 1.7 million hectares in 1996 to 67.7 million in 2003 (James 2003), but most of this cultivation is in a few countries and a few crops. The global market value of GM crops is projected to be $5-billion (US) by 2005, based on the sale price of seed and technology fees. Canada has the third-largest acreage of GM crops worldwide, at 4.4 million hectares in 2003, in canola, corn, and soybeans, representing six per cent of global acreage. As GE food entered the marketplace, regulatory policy became the central focus of contestation. By the end of 2003, Health Canada had completed food safety assessments for sixty-three novel foods, sixty produced through genetic engineering. During the same period, AAFC / CFIA approved forty-five plants with novel traits for environmental release. Public interest groups launched or increased campaigns to raise consumer awareness about potential risks (Leiss 2001). They have used environmental petitions to draw attention to GE food and related issues, including molecular farming, GE fish, and GE wheat.

The GE food regulatory regime has been challenged on its democratic and scientific legitimacy. The first wave of policy making marginalized consumers and focused on a narrow set of concerns. Further, scientific uncertainty about risks could not be easily dismissed. The regulatory regime’s foundations were shaped by past practices of relying on exclusionary science-based authority. But during the 1980s and 1990s, the growing visibility of the precautionary principle encouraged an increased degree of skepticism about the certainty of science-based decision making and contributed to demands for more democratic policymaking. It is clear now that the existing regulatory system has not been a guarantee of market acceptance and consumer confidence, as initially intended.

The regulatory development process left many of the policy issues posed by genetic engineering outside of the scope of policy making. The regulatory regime created in the 1990s was developed through relatively closed policy networks, enlarged occasionally through managed consultations. In 1993, a multi-departmental multistakeholder workshop marked a departure from an initial focus of consulting largely within scientific, industry, and governmental circles. However, this workshop and a subsequent one in 1994 on the technical aspects of labelling were criticized for their limited participant lists and circumscribed discussion. Policy networks around specific issues marginalized or excluded interests outside of government and industry. The lack of attention to consumer concerns was possible in part because in Canada public awareness of the GE food was limited through much of the 1990s. Parliament played a minimal role, with committees occasionally studying issues related to GE technology, often splitting down party lines.

The lack of attention to possible consumer resistance in the first wave of GE food policy making confirms the mature staples status of the agri-food sector. More recent policy efforts to respond to growing and persistent consumer concerns suggests that urban constituencies may be growing in their influence on GE food policy. Urban consumers are likely to focus primarily on the risks and benefits of consuming GE food, and possibly also environmental risks, with minimal knowledge of their impact on the agri-food sector. Since the predominant traits in GE crops to date, notably herbicide tolerance, have offered no tangible benefits to consumers, it is not surprising that significant numbers are skeptical of consuming a new product that may cause risks. However, the key consumer measure of mandatory labelling has not been adopted, demonstrating that GE food policy is still primarily influenced by government and industry priorities. Instead, policy revision has been aimed more at facilitating public debate and shoring up risk assessment. An interesting side effect of the GE food debate is that consumer concern seems to be contributing to a trend of heightened urban interest in how food is produced, which in turn may serve to strengthen connections between urban and staples communities and reverse a longstanding detachment.

It is not clear whether Canada’s new national voluntary standard for GE labelling, which took more than four years to develop, will meet consumer demand for the choice of whether to buy these products. The multistakeholder standard development process, run by the Canadian General Standards Board (CGSB), was boycotted by most of the consumer, environmental, and other public interest groups that support mandatory labelling. Polls suggest that Canadians’ support for mandatory labelling remains high, and concern about genetic engineering grows as knowledge increases (Pratt 2003). A Consumers Association of Canada (CAC) poll by Decima found that eighty-eight per cent wanted mandatory labelling in December 2003. The CAC, once supportive of voluntary labelling, has now become a proponent of mandatory labelling. In 2003, the CAC left the CGSB process, stating that the only way consumers could have assurance is through mandatory label rules. In particular, CAC was opposed to the intention a food product could have up to five per cent GM content and still be labelled GM-free (Wilson 2003b).

Providing a vehicle for broader debate about GE food issues, the Canadian government created the Canadian Biotechnology Advisory Committee (CBAC) in 1999 to provide expert advice on all dimensions of biotechnology: ethical, social, economic, scientific, environmental, health, and regulatory. In 2002, CBAC released a report on GE foods. It is broadly supportive of the existing regulatory regime, but makes many specific recommendations for improving accountability, communications, and transparency. It suggests investment in evaluating and monitoring long term health impacts, improving information for consumers, and urges more attention to social and ethical issues raised by genetic engineering, particularly the distribution of benefits and costs.

In response to public debate over the risks of GE food, the federal government requested in 1999 that the Royal Society of Canada (RSC) create an expert scientific panel to study the scientific issues of GE foods. However, the RSC went beyond this mandate to examine issues such as the integrity of the risk assessment process. For example, it noted the institutionalized conflict of interest stemming from the government’s dual role of promotion and protection. The government’s multi-departmental response to the RSC report came in the Action Plan of the Government of Canada, released in November 2001. Periodic progress reports since then provide detailed descriptions of proposed and completed actions to respond to the RSC report, focusing on scientific assessment tools (substantial equivalence and precaution), transparency and increasing public confidence, human health impacts, and environmental safety.

Policy revision in the wake of the CBAC and RSC reports has included some efforts to broaden the policy network, but not consistently. For example, in May 2002, Health Canada and CFIA held a technical consultation on regulations for novel foods, plants with novel traits, and livestock feeds from plants with novel traits. A broad range of interested parties was invited, but participants included only two representatives from consumer and environmental groups. Other participants came from the agri-food industry, governments, and academic institutions. A Health Canada consultation in 2003 on novel food regulation was broader. Beyond technical questions, it also brought up issues of transparency and how best to involve the public and external experts. Health Canada’s “biotechnology transparency pilot project” allows for public input on new submissions for approval on both scientific and non-scientific aspects, and is exploring how to add external experts to the once-internal review process.

Prior to these reports, the 2000 federal budget provided $90-million to increase capacity in government to respond to GE technology. This money has been used by CFIA and Health Canada to hire new staff, conduct research, develop and improve scientific assessment tools such as those used for toxicological and allergenicity assessments, and whole food testing protocols. CFIA contracted several short term research projects on environmental and other issues. It also launched a long-term study of economic and environmental effects.

Despite these efforts by the Canadian government, biotechnology skeptics remain concerned about the use of public money for the promotion of genetic engineering. In November 2003, the Canadian Health Coalition stated that the Canadian government had spent more than $13-million since 1997 on communications to promote biotechnology, including $1.1 million on polling. Instead, the Coalition argued, this money should have been spent on testing and labelling GE foods. CBAC is also a suspect organization for these skeptics because of its promotion of the development of genetic engineering applications. For example, in February 2004, CBAC issued an “Advisory Memorandum” encouraging renewal of the regulatory regime, to ensure ongoing development and commercialization (CBAC 2004). It warned that “delays in filling the gaps in the regulatory system threaten the research, development, and commercialization in Canada of socially beneficial biotechnology” and that Canada risks losing opportunities, as in the potential for plant molecular farming.

Both the transparency and scientific underpinnings of the GE food regulatory regime remain vulnerable to challenge. The exercise of the protection of “confidential business information” continues to limit public release of information such as location of field trials and details about novel products. The challenge of creating meaningful baselines for risk assessment of novel traits and novel foods appears immense. Recent studies, mostly on environmental issues, tend to support both the concerns of biotechnology proponents and skeptics rather than clarifying the issues. Studies find evidence both to reduce concerns about risks and amplify them (Alexander 2003; Moore, Oliver 2002). Further, there appears to be a lack of data on the environmental and health risks of GE fish and animals, and plant molecular farming.

At the international level, ongoing activities in multiple venues are likely to influence Canadian GE food policy in the future and may act as restraints on domestic policy making. These activities include the Cartagena Protocol on Biosafety, regulatory harmonization initiatives by the Organisation for Economic Cooperation and Development (OECD), and United Nations body Codex Alimentarius’ efforts on labelling. The Cartagena Protocol on Biosafety, part of the United Nations Convention on Biological Diversity, came into force in September 2003 and now has 119 parties to it. The goal of the protocol is to protect biodiversity from the risks of “living modified organisms” produced through genetic engineering. It creates the tool of “advanced informed agreement”, to ensure importing countries are aware of what organisms they are importing. Canada has signed but not ratified the protocol, stating that it is awaiting clarification of key provisions. Negotiations took more than three years and the protocol remains controversial, with concerns about its impact on trade. The OECD continues its efforts, that began in the 1980s, to promote international regulatory harmonization through consensus and guidance documents that focus mainly on the scientific aspects of regulation. Finally, Codex has also been long involved in attempting to create guidelines for labelling of GE food. These discussions continue to be bogged down by major divisions between countries that support mandatory or voluntary labelling on the basis of method of production to respond to consumer interest, and those who feel that this information is irrelevant and a potential major trade barrier. Canada is now leading an electronic working group to revise the current draft guidelines.

Beyond the pressures from environmental groups, consumers, and export markets, the domestic agri-food industry may be losing enthusiasm for GE food. An initially positive, and sometimes enthusiastic, embrace of GE technology in much of the Canadian agri-food sector has become tempered in some quarters. The food industry, for example, has found consumer concern about GE ingredients a significant headache. Further, GE technology has thus far failed to provide notable assistance in coping with the ongoing vulnerabilities of the agricultural sector, and producers in particular, to weather, disease, and economic challenges of globalized agricultural trade and industry consolidation. Some producers have become more skeptical, as they see the loss of export markets and the risks of contamination. For example, Canada’s rapid adoption of GE canola varieties resulted in the loss, at least temporarily, of European markets. In 1994, Canadian exports to EU had reached $424-million a third of all canola exports that year. By 1998, exports had dropped to $2-million. In the late 1990s, the Canola Council of Canada began lobbying the Canadian government to factor in export market approvals into criteria for approval for commercialization. Food processors and retailers also began to take a more defensive position. In discussions on labelling policy, they suggested if mandatory labelling was adopted in Canada, they would stop using GE ingredients.

In fact, the application of GE technology still raises substantive policy concerns about its socioeconomic impacts. There has been no broad public policy discussion in Canada on its potential socioeconomic effects. How might it restructure economic relationships within the agricultural supply chain? What impact might there be on the family farm and the viability of the farm community? It remains unclear how genetic engineering will transform the economic structure of the agri-food industry, and where power will lie. For example, plant molecular farming has the potential, through lucrative non-food crops, to significantly alter Canadian farming. However, it is still in its infancy and there is no certainty about what scale of development will actually be achieved. In turn, it is difficult to predict how the benefits and costs of such change will be distributed. However, in the longer-term, genetic engineering is a potential tool for Canada to shift away from competing in bulk low-cost commodity markets, to selling into premium, niche, and value-added markets.

One key factor behind the distribution of the costs and benefits of GE food technology lies in the use of intellectual property rights (IPRs) to set prices and control access to the use of techniques and genetic material. For example, the commercialization of GE crops has contributed to changing relationships among producers, input suppliers and processors. Contractual agreements, and sometimes vertical integration, are more common, as input suppliers seek to protect the intellectual property in their GE varieties through technology-use agreements and processors become more interested in identify-preserved cultivation and handling systems, often to avoid GE varieties as much as to buy them. Pressure exists to strengthen IPRs in Canada for GE crops and other agricultural applications. Those opposed to strong IPRs believe they result in higher input costs for producers, oligopolistic control of the seed industry, and threats to genetic diversity. The issue of ownership, with the turn toward genomics research, presents huge economic and ethical issues. The potential of genomics raises issues about who will own and be able to access knowledge about the entire genetic makeup of any organism, be it human, animal, plant, insect, or micro-organism. How this question is settled will have a significant impact on the distribution of economic and technological power within the agri-food chain and the future of public research, which has greater potential to produce public goods.



The road ahead for GE food policy in Canada


The examination of GE food policy making in Canada provides solid evidence of the mature staples status of the agri-food sector, with policy generally more attuned to the needs of staples regions than urban / consumer/ environmental constituencies. The government’s enthusiasm for the potential economic and social benefits of biotechnology and genomics remains strong, but both immediate and longer-term challenging policy issues loom. New generations of products promise both greater benefits and greater costs and risks. For example, beyond the immediate issue of whether and when to commercialize GE wheat in Canada, there are the issues of policy responses to molecular farming, GE fish, and GE animals. The impact of these new applications, consumer and industry reaction, and the policy response to them will further demonstrate and influence whether GE food policy becomes more of a post-staples issue, possibly existing within a mature staples sector.

The most immediate issue is whether and when to allow GE wheat into widespread cultivation in Canada. Policymakers have hesitated on this issue, illustrating that they are finding themselves on uncertain ground, as post-staples pressures mount. Monsanto has a GE herbicide-tolerant wheat ready for commercialization but high Canadian dependence on export markets for wheat has caused hesitation regarding its adoption. There is concern that GE wheat could cause significant economic harm if solid market acceptance is not in place ahead of time. The chief executive of one of the largest food processors in the world, Archer Daniels Midland, has cautioned Canada to think carefully about GE wheat, noting that the bottom line is consumer acceptance (Rampton 2004). The Canadian Wheat Board (CWB) has been one of the strongest voices in urging the Canadian government to incorporate market impact / acceptance issues into its decision making. CWB conditions for commercialization include widespread market acceptance, development of an effective segregation system,, and a positive cost-benefit throughout the wheat value chain with particular emphasis on farmer income. In March 2004, the CWB announced that customers representing 87 per cent of the wheat produced by western Canadian farmers required guarantees that the wheat had not been genetically engineered. In the wake of these concerns, Monsanto made a public commitment not to proceed with regulatory approvals and commercial sale until several of these issues were resolved. In 2004, it then decided to unilaterally suspend efforts to proceed with GE wheat until market conditions are more favourable.

Policy makers are also grappling with the challenges of plant molecular farming (PMF), which is the genetic engineering of plants to produce non-food products, such as pharmaceutical ingredients and industrial oils. Federal government-organized workshops in 2001 and 2004 highlighted some of the issues: current inadequacy of segregation and containment systems to prevent contamination of food supplies with non-food products, the related risk of using food crops to produce non-food products (potato, corn, wheat, barley, canola, soybean and flax are all currently being developed as platforms for PMF), implications of greater regulation of the use of land (licensing of farms to produce pharmaceutical proteins, for example), how to deal with contamination issues, the use of human genes, the potential longer-term transformation of Canadian agriculture should PMF become a widescale production activity, and gaps in knowledge and science (detection methods, occupational exposure risks, handling of byproducts and waste, contamination pathways). Preliminary work is being done on a code of best agricultural practices. Meanwhile, industry is complaining that government is being overly cautious and has been slow to approve field trials (Wilson 2003a).

Both GE wheat and plant molecular farming bring up issues of potential conflict over the use of land and liability due to contamination concerns. To avoid contamination, there is potential for significant new costs of segregation / tracing / assurance. Parts of the agri-food industry have argued that it is impossible and impractical to aim for zero per cent contamination—rather that acceptable tolerance levels must be set. However with molecular farming, zero per cent contamination, especially for pharmaceutical products, may well be necessary. Research suggests the release of GM wheat could cost zero-till farmers $400 million a year to clean up herbicide resistant volunteer wheat with chemicals, if there is similar contamination with wheat as has been found with GE canola (White 2003). The Plant Biotechnology Institute has spent $1million over five years on research related to contamination.

A similar slow and cautious pace of regulatory development is occuring with GE fish and animals. Much of effort at current time appears focused on gathering scientific data. Health Canada’s interim policy on food from cloned animals (somatic cell nuclear transfer) of September 2003 states that these animals are considered to fall under the definition of novel foods and therefore a pre-market safety assessment will be required. However, since there is insufficient data to guide safety assessment, developers have been asked to delay novel food notifications for such animals.

Beyond these specific applications, policy makers continue to face the challenge of preserving and increasing the legitimacy of the GE food regulatory regime. Improvements in capacity and transparency have occurred, but will they contribute to the democratic and scientific legitimacy of policy choices? Efforts have been made to increase information available to the public, and provide for the input of the public and external experts in the approval process. But it is not yet clear whether citizen concerns will be better reflected in revised approval guidelines. The use of Parliament and its committees remains minimal, despite being venues where options for capturing the social benefits of the technology could be debated. It will also take at least a few years to judge the success of the effort to meet consumer demands for choice in the marketplace through voluntary labelling instead of mandatory labelling.

There are calls for more radical change. While some argue for total rejection of genetic engineering (Kneen 1999), others suggest concrete ways to improve policy making. Leiss (2001) suggests the federal government stop promoting biotechnology, launch a large-scale long-term public risk dialogue, create a new biotechnology agency to provide oversight of the broader issues, and use independent expert panels more often. Those who have studied the use of risk analysis, the precautionary principle and the involvement of citizens in environmental policy making also have recommendations of relevance. These ideas include “alternatives assessment” that focuses on avoiding or minimizing damage with a strong precautionary basis (O’Brien 2000) and providing participatory deliberative forums where local knowledge of citizens can be used to make better policy (Fischer 2000).

But for the time being, radical change appears to be off the table. GE food policy continues to be driven primarily by economic concerns and the priorities of the agri-food industry. This outcome suggests that while the economic importance of the agri-food sector may have declined, politically it remains significant. This influence in turn likely contributed to the weakness in anticipating skepticism and resistance among domestic and international consumers. In the short term, there appears to be some potential for a shift toward more consumer-responsive policy making, if consumer resistance continues. However, such a shift seems unlikely to improve the weak bargaining position of producers in the economic agri-food supply chain, unless producers succeed in forging more direct producer-consumer links. And over the much longer term, GE technology may indeed be decisive in determining whether and when the sector makes transition to post-staples. Most notably, if molecular farming becomes a significant activity, it may eventually dwarf traditional agri-food activity.

In some ways, Canada’s significant public investment in agricultural biotechnology remains a largely unrewarded gamble. Public benefits from agricultural applications thus far appear minimal considering the scale of public investment. Some producers may have increased their returns by using GE crops, but others have lost markets. Developers promise that new products, still in the pipeline, will bring much more obvious benefits to consumers, such as enhanced nutrition, and more important production traits such as disease resistance, cold and drought tolerance. In the meantime, significant numbers of consumers in Canada and abroad actively avoid GE ingredients in their food. For biotechnology skeptics who remain fixed on questions of scientific uncertainty and sometimes question the fundamental utility and ethics of genetic engineering, persuading them to reduce or drop their opposition may take a massive shift in the cost / benefit equation. With much uncertainty ahead about who will benefit and how from GE food, and agricultural biotechnology more broadly, it is likely the polarization of public debate will continue for some time.

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