By JAMES DETAR, INVESTOR'S BUSINESS DAILY
Shares of Monsanto (MON) dropped again Friday after South Korea joined Japan in suspending importation of genetically modified wheat sourced to the crop seed company.
The moves came after the U.S. Department of Agriculture announced Wednesday that it found genetically engineered wheat, never approved for sale and thought to have been shelved, growing on a farm in Oregon.
Korean millers, who imported about 2.4 million tons of wheat from the U.S. last year for food and animal feed, said they would suspend imports until testing of U.S. wheat determined whether any imported wheat contained the unapproved strain.
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Results of the tests are expected in the first week of June.
The Korean agriculture ministry said separately it plans to temporarily quarantine U.S. feed wheat.
Monsanto sells corn and other crop seeds and crop protection products. The wheat variety found on the Oregon farm was genetically modified to be resistant to Monsanto's Roundup brand herbicides.
Japan earlier canceled plans to buy more wheat from the U.S. Other Asian countries said they're mulling similar moves.
Meanwhile, Monsanto plans to quit lobbying for acceptance of its genetically modified seed in Europe, where it's met with strong resistance. Everyone from French wine producers to German crop growers has objected to its modified seed.
European farmers are concerned that GM crops, once growing, may spread uncontrollably via pollen floating on the wind.
Monsanto spokesman Thomas Helscher told Reuters the company will withdraw from areas where its products don't receive strong support.
"We're going to sell the GM seeds only where they enjoy broad farmer support, broad political support and a functioning regulatory system," Helscher said. "As far as we're convinced this only applies to a few countries in Europe today, primarily Spain and Portugal."
In the U.S., many farmers have boosted profit per acre and use of the GM crop seeds has spread quickly, despite lingering concerns.
Last year, GM crops accounted for 88% of all corn in the U.S., 94% of cotton and 93% of soybeans, according to USDA figures. In Europe, they're estimated to account for less than 1% of crops.
Monsanto shares were down 3.2% in afternoon trading in the stock market today.
The company's stock price had risen 32% in the six months from mid-November to May 15, in sync with a market upturn. The St. Louis company has put up impressive numbers in recent quarters. Earnings per share rose 170% and 20% in the last two quarters, while sales rose 21% and 15%.
From mid-December to mid-May it traded mostly above both 50-day and 200-day averages, but it's now trading well below its 50-day line.
Among other large companies in the group, giant grain and fertilizer company Bunge (BG), with annual sales of roughly $63 billion, fell 2%.
Brazilian sugar producer Cosan Ltd. (CZZ) fell 3.9%, cooking oil recycler Darling International (DAR) fell fractionally and grains distributor The Andersons (ANDE) skidded 2.4%.
S. Korea Joins Japan Blocking Monsanto Modified Seed MON BC CZZ - Investors.com