Argentina soy farmers, seed sellers see progress in royalty talks

BUENOS AIRES, Dec 20 (Reuters) - Argentine soy farmers and the companies that sell them genetically modified seeds could be close to a breakthrough in negotiations after a months-long deadlock that prompted Monsanto to stop selling new GMO technology in the country.

The negotiator representing seed companies in talks with farmers over a bill pending in Congress said on Tuesday that both sides are ready to move toward a deal that would extend the period of time that growers would have to pay royalties on genetically modified seeds.

The government-backed bill says farmers will pay royalties for three seasons after the initial purchase of GMO seeds. But the companies want royalties to be paid for a longer period, according to Alfredo Paseyro, the negotiator for ASA, the group representing seed companies including Monsanto Co.

“The three years proposed by the government is not adequate because it takes longer to develop new seed varieties,” Paseyro told Reuters on Tuesday.

“The time during which royalties have to be paid will have to be negotiated in a way that works for both the seed industry and the farmers. The good news is that now both parties are willing to negotiate,” Paseyro said.

The results of the negotiations will be incorporated into the bill that will be debated and voted on by Congress.

Soybeans can themselves be used as seeds. Seed companies say that planting second-generation genetically modified beans without paying royalties is an intellectual property violation.

Monsanto has said it is not selling new technology in Argentina until a royalties deal is reached. This threatens to put Argentine farmers at a disadvantage against their Brazilian and U.S. competitors.

“We are willing to negotiate an extension of the time frame,” Daniel Pelegrina, vice president of the Argentine Rural Society, recently told Reuters. The group represents some of Argentina’s biggest producers of farm products.

“Seven seasons. Five seasons ... we’ll see what the right number is to motivate companies to come up with new varieties, new genetics, and sell that seed technology to us,” he said.

The new flexibility signals a possible solution that would help Argentina increase soybean production, expected at 52.5 million tonnes this season.

The country is the world’s No. 1 exporter of soymeal, a livestock feed, and the third biggest exporter of raw soybeans.

Almost all the soy grown in Argentina is genetically modified. Most of the seeds are bought on the black market or GMO beans used as seeds without paying royalties. (Writing and additional reporting by Hugh Bronstein; Editing by Jeffrey Benkoe)