Genetically Modified Foods:Are They Safe?

W.F. Kee – Industry Analyst Technical Insights Group

AGRI-FOOD SAFETY AND STANDARDS SEMINAR 2010Berjaya Times Square Hotel & Convention Centre, Kuala Lumpur

January 26, 2010

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Who is Frost & Sullivan?

Introduction to GMO

Agenda

Key Drivers and Challenges, Key Players

Overview of GM Industry and Trends

5 Malaysia’s Biosafety Act 2007

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• The Growth Consulting Company • Over 1,700 employees across 31 global locations in 22 countries.• Over 10,000 clients worldwide including emerging companies, the

global 1000 and the investment community• Founded in 1961• Developers of the Growth Acceleration System, which includes the

CEO’s 360 Degree Perspective, CEO’s Growth Team, Growth Model, Growth Excellence Matrix and Growth Workshop.

Who is Frost & Sullivan?1

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Frost & Sullivan’s Industry Coverage

1. Aerospace & Defense2. Automotive & Transportation3. Chemicals, Materials & Food4. Electronics & Security5. Energy & Power Systems6. Environmental & Building

Technologies7. Healthcare8. Industrial Automation &

Process Control9. Information & Communications

Technologies10. Measurement & Instrumentation

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Introduction to GMO

• Definition of GMO: A genetically modified organism (GMO) whose genetic material material has been altered using genetic engineering techniques.

• Genetic engineering techniques include gene targeting, gene splicing, gene silencing, gene transfer, etc.

Rank Country Area (million hectares) Types of Crops

1 USA 62.5 Soybean, corn, cotton, canola, squash, papaya, alfalfa, sugarbeet

2 Argentina 21.0 Soybean, corn, cotton3 Brazil 15.8 Soybean, corn, cotton4 India 7.6 Cotton5 Canada 7.6 Canola, corn, soybean, sugarbeet

6 China 3.8 Cotton, tomato, poplar, petunia, papaya, sweet pepper

7 Paraguay 2.7 Soybean8 South Africa 1.8 Corn, soybean, cotton9 Uruguay 0.7 Soybean, corn

10 Bolivia 0.6 Soybean

Source: ISAAA, 2008

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Key Drivers3

Sustainability Climate Change

Food Security

High Price of Food

Alleviation of Poverty and

Hunger

Source: Frost & Sullivan.

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Key Challenges

Ecological Concerns

Difficulty in Obtaining Biological

Sequences

Intellectual Property Rights

Prohibitive Costs

Safety of GMOon Human

Health

Source: Frost & Sullivan.

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Key Players

GM Seeds

BASF Plant Science

Bayer Bioscience (division of Bayer Cropscience)

DuPont

Dow Agrosciences

Syngenta

Monsanto

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Source: Frost & Sullivan.

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Desired Crop Traits

Crop Traits

Enhanced Nutrition

Delayed Ripening

Drought Tolerance

Virus Resistance Stacked Traits

Soil Tolerance

Insect Resistance

Herbicide Tolerance

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Source: Frost & Sullivan.

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GM Crops

Soybean

• 70% (65.8 million has.) of total global soybean planted is GM

• Countries growing GM soybean:Argentina, Bolivia, Brazil, Canada, Chile, Mexico, Paraguay, Uruguay, South Africa, and the USA.

Corn

• 24% (37.3 million has.) of total global corn planted is GM

• Countries growing GM corn: Argentina, Brazil, Canada, Chile, Czech Republic, Egypt, Germany, Honduras, Philippines, Poland, Portugal, Romania, Slovakia, South Africa, Spain, Uruguay, and the USA.

Canola

• 20% (5.9 million has.) oftotal global canola plantedis GM

• Countries growing GMcanola: Canada, Chile, andthe USA.

Cotton

• 46% (15.5 million has.) oftotal global cotton plantedis GM

• Countries growing GM cotton: Argentina, Australia, Brazil, Burkina Faso, China, Colombia,India, Mexico, South Africa, and the USA.

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Breakdown of GM Crops

53%

30%

12%5%

Soybean

Corn

Cotton

Canola

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Source: Frost & Sullivan.

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Countries Growing GM CropsSource: Clive James, 2008

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Varieties of GM Crops

Crop GM PropertySoybean Herbicide resistant, different lipid profileCorn Herbicide and insect resistant, vitamin enrichedRapeseed / Canola Herbicide resistant, different lipid profileCotton Pest resistantPapaya Virus resistantTomato Delayed ripeningPotato Higher starch contentSugar cane High sucrose content, pesticide resistantSugar beet Herbicide resistantRice Vitamin A enriched (“golden rice”)

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Technology Trends in GM Crops

Patent-protected food crops (herbicide resistant)

First commercialized in the 1990s

Stress tolerant

Enhanced nutrition

Multiple traits

Therapeutic crops Disease resistant

Insect resistant

Stacked trait seeds

Past

Present

Future

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Source: Frost & Sullivan.

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Malaysia’s Biosafety Act 2007

• According to the Act, a “living modified organism " means any living organism that possesses a novel combination of genetic material obtained through the use of modern biotechnology

• The Act calls for the establishment of the Genetic Modification Advisory Committee, whose function is to provide scientific, technical and other relevant advice to the Minister or the Board

• With regards to GM labelling, the Act requires that all living modified organisms, items containing living modified organisms and products of such organisms shall be clearly identified and labelled

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Q & A

W.F. KeeIndustry AnalystTechnical Insights(+603) 6207-1051waifun.kee@frost.com