CHICAGO (Reuters) - With expectations rising that China will soon approve imports of a genetically modified corn variety developed by Syngenta AG, the seed maker dropped a lawsuit against Bunge North America over the agribusiness company’s refusal to handle the controversial grain, court documents show.
The settlement clears up a long-running legal dispute over Syngenta’s genetically modified Agrisure Viptera corn and probably precedes an eventual decision by Bunge to begin accepting the grain, also known as MIR 162, as the China market opens up.
One of the world’s largest agricultural trading houses, Bunge accepts corn varieties marketed by the world’s top seed makers from farmers at its grain elevators.
Bunge and Syngenta agreed to dismiss the litigation over Viptera corn without paying any fees or costs to each other, according to court documents filed on Friday.
On the same day, Syngenta said it expected to win Chinese government approval soon for Viptera corn imports. On Wednesday, a trading source in China told Reuters a final decision on approval for the strain would probably come in January or February. China’s Agriculture Ministry declined to comment.
Bunge spokeswoman Deb Seidel said the company would decide when to accept Viptera corn once Syngenta provides the necessary evidence of approvals in export markets.
Viptera has roiled the U.S. farm sector since China last year began rejecting boatloads of U.S. corn containing the trait, which is approved for planting in the United States but not for import by China.
Commodities traders Cargill Inc and Archer Daniels Midland Co, along with dozens of farmers, have sued Syngenta, claiming hundreds of millions of dollars in damages from the trade disruptions.
Bunge began refusing to accept deliveries of Viptera corn in 2011 because it lacked import approval from China, a major buyer. Syngenta sued Bunge that year.
In October, a U.S. appeals court opened the door for the lawsuit to proceed after earlier victories by Bunge.
The outcome of the litigation affirmed Bunge’s “right to not accept Viptera as a legitimate business decision,” Bunge North America Chief Executive Officer Todd Bastean said in a statement.
“From the beginning, Bunge took this action to protect our farmer customers and the export supply chain.”
Syngenta said farmers had benefited from growing Viptera corn, which is engineered to control pests. The company has said it will announce Chinese approval of Viptera imports when it receives official documentation.
The case is Syngenta Seeds Inc v. Bunge North America, U.S. District Court, Northern District of Iowa, No. 11-cv-04074.