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U.S. Agricultural Biotechnology in Global Markets: An Introduction

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U.S. farmers have been rapidly adopting genetically engineered (GE) crops -- mainly corn, soybean, and cotton varieties -- to lower production costs and improve management. However, the U.S. agricultural economy is highly dependent upon exports, at a time when many foreign consumers are wary of the products of agricultural biotechnology. As a result, U.S. exporters often have encountered barriers to trade in these markets.

Among the most controversial barriers is in the European Union (EU). The EU, the fourth-largest foreign market for U.S. agricultural products, since 1998 has maintained a de facto moratorium on approvals of new GE crop varieties. In May 2003, the United States launched a formal challenge of the EU policy, contending that it both violates international trade agreements and causes unwarranted concerns about the safety of agricultural biotechnology throughout the world.

The EU and other important U.S. trading partners around the world have adopted widely divergent approaches to regulating biotechnology. The wide range of approaches to GE product regulation is in part due to the fact that an international consensus on how to regulate agricultural biotechnology is still evolving. U.S. officials say they are active globally to ensure that national and international standards for genetically modified organisms (GMOs) are consistent, transparent, based on scientific principles, and compliant with international trade rules (e.g., those administered through the World Trade Organization). For example, they have been working to ensure that the so-called Cartagena Biosafety Protocol, a multilateral agreement on the safe handling, transfer, and transboundary movement of living modified organisms, does not present new obstacles to U.S. exports of such products.

Another issue involves recent difficulties in moving U.S. food aid to certain African countries due to what U.S. officials said were unwarranted, EU-provoked concerns that such aid's possible GE content could pose safety problems for recipients. Debate also revolves around the potential benefits and problems of introducing GE crops to developing countries.

Congress continues to follow these issues closely. For example, a number of leading lawmakers pressed hard for the Administration to aggressively challenge the EU moratorium. Following the Administration's decision to do so, the Senate and House passed resolutions (S.Res. 154; H.Res. 252) in support of the action. Several House hearings have been held to review barriers to the adoption of, and trade in, GE agricultural products; and to review challenges and opportunities for plant biotechnology development in Africa. Additional hearings are possible. Whether the 108th Congress will consider other legislation affecting agricultural biotechnology was uncertain in June 2003. This report will be updated if events warrant.