Cargill sues Syngenta over sale of GMO corn banned by China

CHICAGO (Reuters) - Cargill Inc [CARG.UL], the top U.S. grain exporter, sued a unit of Syngenta AG in a Louisiana state court on Friday for damages stemming from China’s rejection of genetically modified U.S. corn, which Cargill said cost the company more than $90 million.

A logo is pictured on the building of Cargill International SA in Geneva August 4, 2009. REUTERS/Denis Balibouse

Minnesota-based Cargill accuses Syngenta of exposing the grain trader to losses by selling the seeds to American farmers before the Swiss company had secured import approval from China, a major buyer.

The Agrisure Viptera corn variety known as MIR 162 can be found throughout the U.S. corn supply, effectively closing the lucrative Chinese market to U.S. supplies, the lawsuit said.

Cargill is suing Syngenta for negligence; knowing, reckless or willful misconduct and unfair trade practices.

The lawsuit seeks to hold Syngenta responsible for “deliberate, knowing and continuing contamination of the U.S. corn supply with a product that it understood all along would substantially impair the U.S. grain industry’s ability to sell corn and other commodities to buyers in China,” according to Cargill’s filing.

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Since November, China has rejected imports of hundreds of thousands of tonnes of U.S. corn, including from vessels loaded by Cargill in Louisiana, due to the presence of the MIR 162 trait, according to the lawsuit.

Syngenta, the world’s largest crop chemicals company, said in a statement that the lawsuit was without merit.

Trade disruptions have cost the U.S. grain industry up to $2.9 billion, according to an estimate by the National Grain and Feed Association (NGFA), which was not immediately available for comment about the lawsuit.

In April, Cargill said the rejection of U.S. corn shipments by China had contributed to a 28 percent drop in its earnings for the quarter ended Feb. 28.

The case is Cargill v. Syngenta Seeds, Judicial Court for the Parish of St. John the Baptist, State of Louisiana, No. 67061.

Editing by Lisa Von Ahn and Matthew Lewis