UPDATE 2-China still evaluating rejected gene-modified strain of corn

Fri Apr 4, 2014 4:49pm EDT

* Import of Syngenta's MIR 162 corn not yet approved -industry source

* China's agriculture ministry says still evaluating the strain

* Volume of U.S corn rejected because of the strain totals nearly 1 mln T (Updates with comment from Syngenta)

By Niu Shuping and David Stanway

BEIJING, April 4 (Reuters) - China has still not approved a gene-modified strain of corn known as MIR162, the government said on Friday, prolonging a ban that has seen nearly 1 million tonnes of the U.S. grain turned away from Chinese ports since November.

Asked if its biosafety panel had made a final decision, the agriculture ministry said it was still evaluating materials related to the strain that had been submitted late last year by developer Syngenta.

The biosafety panel is responsible for approving GMO imports and held a regular quarterly meeting at the end of last month.

"Syngenta has provided (additional) relevant materials as required and the strain is currently in the process of evaluation," the ministry said in an email.

The timing for a potential decision on MIR 162 was unclear, as Syngenta said it believed the biosafety panel's next meeting was not scheduled until mid-April. The company last month responded to questions about MIR 162 that it had received from the committee in February, according to Syngenta.

"Syngenta has not been notified of any decision on the MIR 162 dossier in China," the company said in a statement.

Industry sources had expected Beijing to delay approval of the strain, designed to protect plants from insects, with the world's second largest consumer of corn now awash in a glut of domestic supply amid weak demand and a record harvest.

"The biosafety committee has not approved the strain," said one industry source, who declined to be identified because of the sensitivity of the issue.

"Given the huge domestic supply, we don't expect the ministry to approve it until the second half of the year."

Another meeting of the biosafety committee is expected in June.

The ministry said its evaluation follows "scientific and cautious principles" to prevent genetically modified strains from taking a toll of food or environmental safety.

Beijing has stockpiled a record volume of corn, amounting to more than 90 million tonnes, over the past two years, in a bid to help prop up domestic prices and protect rural incomes.

China's quality watchdog in the eastern coastal province of Jiangsu has turned away about 65,200 tonnes of U.S. corn and corn products this week, after detecting the presence of MIR 162, a domestic newspaper reported on Thursday.

That takes to nearly 1 million tonnes the total amount of corn that China has rejected since November from the world's largest exporter, the United States.

Chinese buyers also cancelled purchases of 221,400 tonnes of U.S. corn last week, the U.S Department of Agriculture said.

The cancellations by China, the third largest buyer of U.S. corn, may undermine Chicago corn futures, which have been supported by brisk export demand from other countries. (Additional reporting by Tom Polansek in Chicago; Editing by Clarence Fernandez and Meredith Mazzilli)

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