1. StarLink Tm : 3/6/01 By Dr. Robert Wisner University Professor of Economics Iowa State University Source: Kan Ham, ISU Agronomy Dept.

2. StarLink tm --Crisis in the CornMarket? U.S. Corn Exports & outstanding export Sales, 3/01/01: –Japan -17% –South Korea -43% –Taiwan +1% –Africa -4% –W. Hemisphere +5% –All destinations -10% –Pre-StarLink Proj. +13 to 17%

3. Normal Shares of U.S. Corn Exports Japan 31% S. Korea 13% Taiwan 9% 3-mkt. Total 53%

4. Starlink, Cont. EPA in October approved Starlink exports for feed, if segregated from other corn Not approved for export for food anywhere, or for feed in Japan Nov.: EPA outside panel reviewed new Aventis data for possible acceptance as food Cry9C protein was found in blood stream of Norway rats, with immunologic response Medical panelists: some persons may have experienced allergenic reactions from Cry9C

5. Industry/USDA Efforts to Deal With the Problem Food & feed export certification programs Sampling problem: Japan & Korea finding StarLink Avg. contamination: fraction of a % The future: Problem for at least another year problem (co-mingled stocks) Possible 400-700 (000) units of contaminated non-StarLink seed for 2001 (USDA to buy this from small companies)

6. StarLink tm or Cry9C Cont.: Was Grown in 1999 & 2000 Center for Disease Control testing alergenic reactions from StarLink Japan testing StarLink for possible feed approval Farmers: Important to control volunteer StarLink in StarLink & neighboring fields Need to clean planters

7. Corn Refiners Assoc. Release 10/9/00 Ethanol is produced by CRA members in same facilities with food production StarLink tm in their facilities violates U.S. govt. registration for the product Also, gluten goes to export markets Limited number of dry-milling plants may use StarLink tm for ethanol, where by-products are only for feed

8. EPA Announcement 3/7/01 Wet Milling Eliminates (or nearly eliminates) Starlink Protein Immediate change in processor acceptance of Starlink of food approval not expected

9. Elevator Price Impacts (Varies over Time) Jan. 12, 01 example, N. Iowa if rejected @ ADM, next market is feed exports –Non-Starlink bid to elevator -$0.36 March –StarLink bid :-$0.50 March if open river could be found –Earlier, poultry mkt in Arkansas was ok, but saturated in January –Local feed mill: best outlet if enough demand –Source: Dr. Marty McVey, Agri-Industries, Des Moines, IA 1/12/01

10. 20,000 to 99,999 100,000 to 1,000,000 None reported 0.5% of U.S. crop, 1.1% in Ia (Highest co. 9.1%) 0.6% in Minn., 0.5% in Nebr., 0.6% in KS.

11. The Future? EU-unapproved varieties: another StarLink tm waiting to happen? ADM and Staley caution farmers: plant only varieties approved world/wide At stake: the EU gluten mkt. (About 60% of output) Some companies plan to target sales to livestock areas (Similar strategy to StarLink)

12. Illinois Dept. of Agriculture & Land Stewardship For 2001, requests that seed companies sell only varieties approved for all markets world-wide So far, no similar response from other states

13. Future Implications, Cont. StarLink acres, % of U.S. 2000 corn crop: Approximately 0.5% % of U.S. corn acres with varieties not approved world-wide in 2000:7.0% Channels at Risk: Wet-millers, & Exports to EU Can we channel it & keep it separate? Co-mingling, cross pollination, marketing?

14. EU Unapproved Corn Varieties –Markets at risk –Wet millers: Approximately 18% of total demand for U.S. corn (StarLink affected 30-38% of demand) –European Union: 1-2 million bushels (starting to recover a little) –Asian market acceptance, so far not a problem –S. Korea began GMO labeling March 1, 2001 –Japan starts labeling April 1, 2001

15. EU Super Markets Going 100% Non-GMO Livestock Products Tesco (Late 2001) Asda (Late 2001) Iceland (Already doing it) Marks & Spencer (Already doing it) Safeway (No date) Sainsbury (No date) Summerfield (No Commitment on GMO - free meat) Fast food: Mc Donalds, Burger King

16. Products Not Approved for EU Product Registrant Trade NameCharacteristicEvent Monsanto YieldGuard/ Roundup Ready Corn borer resistance & glyphosate herbicide tolerance Mon810 + GA21 Pioneer YieldGuard/ LibertyLink Corn borer resistance & glufosinate tolerance Mon810 + T25 Monsanto Roundup Ready Glyphosate herbicide tolerance MonGA2 1 Source: National Corn Growers Assn. * Pioneer YieldGuard/LibertyLink: no sales for 2001 *

17. New Foreign GMO Regulations EU: could bring expanded GMO approvals, but will take time, requires major testing EU is expected to provide for traceability (Consumer Demand) UN panel: Encourages labeling

18. Future GMO Developments Countries adding GMO labeling: Japan April 2001 S. Korea March 2001 Those without specific dates: Philippines Australia New Zealand Thailand Malaysia 2000 Global Biosafety Protocol Treaty to encourage labeling