The New York Times

                September 28, 2003, Sunday, Late Edition - Final

HEADLINE: Hard Realities: Brazil Drops Resistance to Genetically Altered Crops




   In barely 36 hours, Brazil's left-leaning government first announced that it
would allow farmers to plant genetically altered soybean seeds, then reversed
course, before changing yet again, late on Thursday.

   The result is that Brazil, a bastion of global opposition to genetically
modified organisms, has given in.

    From the time President Luiz Inacio Lula da Silva founded the Workers' Party
more than 20 years ago, environmentalists have been an important constituency
and their programs part of the party's platform.

   Those commitments, though, have had to give way to the hard realities of
politics and to Brazil's drive to increase exports. The country wants to become
an agricultural superpower.

   Brazil is the world's second largest producer of soybeans, but it is expected
to surpass the United States to become the largest soybean producer as early as
the coming harvest. The Southern Hemisphere's planting season is just starting,
and the government has faced mounting pressure from agribusiness interests to
ignore court injunctions, requirements for environmental impact studies and
other regulations.

   The issue has proved so contentious that Brazil's 175 million people have
been treated this week to the spectacle of a public exchange between Mr. da
Silva, who was in New York for United Nations meetings, and his vice president,
Jose Alencar. After Mr. Alencar had second thoughts and said he would not
approve the measure, Mr. da Silva warned from the United States that the vice
president "knows what he has to do, and he will do it."

   As recently as June, Mr. da Silva's chief of staff, Jose Dirceu, promised
that Brazil would not allow the planting of genetically modified crops, which
opponents contend can present risks to human health, the environment and
biodiversity. "The law will be obeyed because that is the determination of the
president," he said then at a seminar in Sao Paulo.

   The Brazilian press has speculated that Mr. Dirceu engineered the timing of
the announcement of the measure so it would occur when his boss was out of the
country and Mr. Alencar was the acting president, as provided for in the
Constitution. That way, the vice president, who is not a member of the governing
party, and not Mr. da Silva, would have to bear the political onus of making so
unpopular a decision.

   But Mr. Alencar initially surprised everyone by saying the measure "goes
against existing Brazilian legislation" and calling an emergency cabinet
meeting. "The next time, I'm going to be the one who travels," Mr. Alencar said
Thursday night, after backing off and finally signing the decree.

   The "provisional decree" that the government announced applies only until the
end of next year and contains several other restrictions. Farmers cannot plant
genetically modified soybeans near nature reserves and watersheds or transport
seeds across state lines and must also sign a document agreeing to pay an
indemnity for any damage to the environment or consumers' health.

   Nevertheless, the decision is a significant victory for large biotechnology
companies like Monsanto, which stands to gain the most from the policy change.
Since the mid-1990's, Greenpeace and other international and local consumer and
environmental groups have been battling in Brazilian courts and the corridors of
Congress to prevent Brazil from following the path of Argentina and other large
agricultural producers that have already legalized the genetically modified

   In addition, Brazil, which in years when it has bumper crops often ranks as
the largest exporter of agricultural products after the United States, has
traditionally banned genetically modified foodstuffs from the shelves of grocery
stores here and prohibited the use of genetically modified animal feed and
grain. That has given it a certain commercial advantage over its rivals in
markets like Europe, where opposition to such products remains strong.

   On Thursday, the Brazilian chapter of Greenpeace accused the government of
betraying its principles, selling out to big business and "disrespecting a
commitment" made during last year's presidential campaign. The group vowed to
challenge the decree in court and was joined in its criticisms by the national
association of judges, which said the measure was "juridically absurd and
flagrantly unconstitutional."

   The government's about-face is also likely to provoke tensions in the warm
relations between Mr. da Silva and his allies and admirers in the Green movement
in Europe. His Workers' Party has been the main sponsor of the annual World
Social Forum in the southern state of Rio Grande do Sul, which has emerged as a
magnet for antiglobalization groups, whose agenda includes strong opposition to
the genetically modified foods.

   But many small farmers affiliated with the landless movement have also been
clandestinely planting their own fields with genetically modified soy seeds
smuggled across the border from Argentina. They justify that contradiction by
arguing that they have lower production costs with these seeds and have
complained that they will be driven into bankruptcy if the Brazilian government
continues to ban them.

   Monsanto has tried unsuccessfully to collect royalties from Brazilian soy
producers using its genetically modified seeds. The government decision includes
a provision that requires farmers planting such seeds to acknowledge that they,
and not the government, are responsible for any such payments.