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House of Assembly - Fifty-Third Parliament, Second Session (53-2)
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Bills

Genetically Modified Crops Management Regulations (Postponement of Expiry) Bill

Second Reading

The Hon. L.W.K. BIGNELL (Mawson—Minister for Agriculture, Food and Fisheries, Minister for Forests, Minister for Tourism, Minister for Recreation and Sport, Minister for Racing) (12:26): I move:

That this bill be now read a second time.

I seek leave to insert the second reading explanation in Hansard without my reading it.

Leave granted.

Overview

South Australia is one of the few jurisdictions in the world to be phylloxera free, fruit fly free and have a moratorium on growing genetically-modified (GM) food crops.

These credentials give the State's primary producers and food and beverage manufacturers a competitive marketing advantage in the global marketplace.

South Australia is the only remaining mainland state in Australia to prohibit the commercial cultivation of GM food crops.

Our non-GM status is one of the elements underpinning our global reputation as a supplier of premium products, and supporting the Government's Premium Food and Wine Produced in our Clean Environment and Exported to the World economic priority.

Through the Genetically Modified Crops Management Act 2004 and Regulations, a moratorium on the commercial cultivation of genetically-modified food crops is in place until 1 September 2019.

On 18 October 2017, my colleague in the other place, Greens State Parliamentary Leader, introduced a Bill which would extend these Regulations until 2025.

He has stated the intent of the Bill is to ensure there is parliamentary debate before the Regulations expire in 2019.

I congratulate the Member in the other place for bringing this matter to the attention of the Parliament for early consideration before this expiry occurs.

The Bill aligns with Government policy and brings forward consideration of whether the current legislation should be retained, extended or removed prior to 1 September 2019.

Extending the prohibition on growing GM food crops would provide greater certainty to our trading partners and industry, enable South Australia to maintain its market position as a producer of premium, non-GM food, and respond to the expected increase in global demand.

Costs and benefits

When it comes to the GM prohibition in South Australia, canola is really the only GM food we are talking about.

But the benefits—now and into the future—of being able to market South Australia as non-GM, fruit fly free and phylloxera free apply across our whole state and to all our agribusiness industries.

There is a clear premium for non-GM canola over GM canola.

Domestically, a review of prices for commodity non-GM and GM canola in March 2016 found price premiums of between 10% and 17% ($45 to $69 a tonne) for non-GM canola at Victorian, New South Wales and Western Australian grain receival sites.

There will be seasonal variation but the premium remains, with the latest information for the upcoming season putting the premium at between $20 and $35 a tonne.

On 22 November 2017, the price difference between non-GM and GM canola in Victoria was $40 per tonne.

South Australian non-GM canola gains an equivalent price. It is also effectively worth more to the producer as there are no costs for separating GM and non-GM grain through the supply chain and they are not paying the higher GM seed costs or GM variety royalties.

The benefits of South Australia's non-GM status extend beyond a single crop and are available to the whole agricultural, food and beverage sector, which generated a record $19.97 billion in revenue in 2016-17.

Report by the University of Adelaide

A 2016 report by the University of Adelaide investigated global trends for packaged, non-GM, natural and organic food and beverages.

The report, commissioned by the State Government, indicates the global market for non-GMO labelled foods and beverages will reach $US 949 billion by 2018 from a base of $US 521 billion in 2014, creating export market opportunities for South Australia.

Findings indicate the United States is a complex market but one where there is strong demand growth for non-GM labelled food. China is also identified as a market willing to pay a price premium for foods they trust. These are our largest and fastest growing markets for SA food and wine.

While not intended to address the South Australian legislative framework prohibiting commercial cultivation of GM food crops, the report does identify the State's GM moratorium as one of several current assets available to capitalise on non-GM food export market opportunities.

Since the report's release:

A communications and engagement strategy has been developed

Four key market strategies (UK, US, Japan, China) are being developed based on the work of the report

French and EU non GM policy and opportunities have been investigated during the Great Wine Capitals meeting

Round 3 of the Credentials Program has completed, which targeted non-GM certification for businesses. Grant recipients were:

AJ and VJ McTaggart's, Bultarra Australian Certified Organic Saltbush Lamb and Yeltacowie Pastoral's application to become Non-GMO certified; and

Tucker's Natural's application to support non-GM and safe quality food certification.

The pilot non-GM food sector Statement of Recognition Program has recently been offered to the South Australian food and beverage sector with three successful recipients, including Tucker's Natural, Greenwheat Freekeh and Kangaroo Island Pure Grain.

I have approached US supermarket chain Wholefoods to explore how South Australia could capitalise on Wholefoods' GM-free commitment.

PIRSA is also investigating opportunities to work with interested businesses to further capitalise on and market South Australia's non­GM status.

South Australia's non-GM status has been, and continues to be, promoted in a food and wine industry toolkit video which is on the PIRSA website and is shown on inbound and outbound trade missions including the most recent trade mission to North East Asia (Japan, South Korea and Taiwan).

PIRSA continues work to further capitalise on SA's non-GM status, including:

Analysing domestic and export market legislative requirements and certification processes

Assessing the full advantages of not having to segregate crops

Assessing the current impacts of SA's moratorium on the cultivation of GM food crops on primary producers and the field crops supply chain, and

Consultation and participation in the Commonwealth's review of gene technology regulation.

Industry views

I know industry opinions are mixed on this—and I received the industry petition from Grain Producers SA in August 2016 with 221 signatories (out of a total 5,800 grain growers) calling for the moratorium to be lifted but I am approached by farmers all around the state, including grain growers, who tell me they support the moratorium.

A number of South Australian businesses are using their non-GM status and the state's GM food crop prohibition to access new markets and grow sales.

Our non-GM status was critical in developing export markets for Kangaroo Island Pure Grain, attracting international investment and acting as a strong drawcard for Japan based Hirata Industries who have come to South Australia to import non-GM canola from Kangaroo Island.

The University of Adelaide report highlights a number of other South Australian food exporters promoting their non-GM status including: Tuckers Natural, San Remo, Fleurieu Milk and Yoghurt Co and B-D Farms Paris Creek.

Sam Densley from QualityWise Oats has told me he gets a premium price from access non-GM markets for his specially labelled oat products.

I have spoken with Mark Harvey—Chairman, S&W Seed Company, who publicly supports our policy on behalf of his industry because it brings them many benefits and market access.

The State Government is committed to realising the market opportunities for our agribusiness industries by maintaining the moratorium through an ongoing legislative prohibition.

Mr PEDERICK (Hammond) (12:27): I rise as the lead speaker in regard to the Genetically Modified Crops Management Regulations (Postponement of Expiry) Bill 2017. I note that the Liberal Party oppose the bill and I will explain why. The bill is for an act to postpone the expiry of the Genetically Modified Crops Management Regulations 2008. The bill seeks to further postpone the Genetically Modified Crops Management Regulations 2008 until 1 December 2025. I also note that the government have filed amendments to extend that moratorium until—

The Hon. L.W.K. Bignell: No, we are not doing that.

Mr PEDERICK: You are not doing that. It has been indicated that the government is not filing amendments to extend that moratorium until 2028, which would have resulted in a 20-year moratorium on genetically-modified crops in South Australia from when it was first introduced. Under the Genetically Modified Crops Management Act 2004, no genetically-modified food crops can be cultivated in South Australia.

Before proceeding further with the debate, I would like to indicate that the state opposition has supported the current genetically-modified crops moratorium in South Australia. However, if elected in March 2018, we will commission and finalise an independent review within six months on the subject of genetically-modified crops. That review is about getting an expert panel in place to look at the science and economics of whether there is a premium for staying genetically modified free in this state.

The opposition do not think that it is acceptable for a government to impose a moratorium totalling 17 years with zero consultation with the industry. We believe that there needs to be expert advice provided to investigate and highlight the facts, which is why a high-level review has our full commitment. Australia has been cultivating genetically-modified cotton since 1996. CropLife Australia has noted that today 96 per cent of cotton grown is genetically modified, and its production has cut pesticide use down by up to 85 per cent in comparison to conventional cotton varieties. Some of these are herbicides. In the main, these sprays are insect sprays, or insecticides, which are the most dangerous to use on farms. That figure of 85 per cent in reduced insecticide use in GM cotton production is a significant figure to acknowledge.

The manipulation of the genetic make-up of animals and plants has been happening for countless generations. Those techniques are often referred to as traditional crossbreeding, such as selecting plants and animals with the most desirable characteristics for breeding the next generation. We see this principle being considered for many creations of life, whether it be for animals or plants. We have seen it in the cattle industry and the sheep industry, just to name a couple, where people breed rams for size, for the wool growth they want, for the wool traits they want or so they can breed the stock they want. In regard to cattle, they do so to get that growth in the hindquarters, etc.

Driving deeper into the theory of generations of selective breeding can be heavily related to the breeding of companion animals, such as dogs. Genetically-modified foods are derived from genetically-modified organisms. All approved GM foods come from GM plants, such as corn plants with a gene that makes them resistant to insect attack, or soybeans with a modified fatty-acid content that makes the oil better suited to frying. Recent developments have seen the approval of a canola line that has been genetically modified to produce considerably high levels of omega 3, a long-chain fatty acid, docosahexaenoic acid (DHA). Other publications have stated that if you can achieve 12 per cent levels of DHA in canola oil, then one hectare of this crop can meet the same production levels produced by 10,000 ocean fish.

Some may not be aware, however, that insulin for diabetics is also derived from genetically-modified bacteria. Conventional methods of obtaining insulin is taken from the pancreas of a pig or a cow. However, modern practice now enables the development of insulin synthetically. There are advantages to creating insulin synthetically, including that it is easier to create high quantities, that it is less likely to result in an adverse reaction and that 'it overcomes ethical concerns from vegetarians and others'. Obviously, insulin is necessary for diabetics in the control of sugars.

Food Standards Australia New Zealand is also currently assessing genetically-modified rice, which would contain high levels of vitamin A, which again would result in health benefits for recipients. Genetic modification is also present in corn products, such as corn oil, cornflour or corn syrup used in snack foods, fried foods and confectionery. It is also used for cattle feed. Interestingly, I have located a list of percentages from the top seven genetically-modified crops grown in the United States, as follows:

corn: corn is the number one crop grown in the US, and nearly all of it (88 per cent) is genetically modified;

soy: 93 per cent of soy is genetically modified. Soy is a staple of processed foods under various names, including hydrogenated oils, lecithin, emulsifiers, tocopherol (a vitamin E supplement) and proteins;

cottonseed: according to the United States Department of Agriculture, 94 per cent of cotton grown in the United States is genetically modified. Cottonseeds are culled from cotton and then used for vegetable oil, margarine or shortening production, or frying foods, such as potato chips;

alfalfa or lucerne: farmers feed alfalfa to dairy cows, which are the source of milk, butter, yoghurt, meat and so much more. Alfalfa is the fourth largest crop grown in the United States behind corn, soybeans and wheat. There is no genetically-engineered wheat on the market;

papaya: 75 per cent of the Hawaiian papaya crop is genetically modified to withstand the papaya ringspot virus;

canola: about 90 per cent of the United States' canola crop is genetically modified. Canola oil is used in cooking, as well as biofuels; and

sugar beets: more than half (54 per cent) of sugar sold in America comes from sugar beets. Genetically-modified sugar beets account for 90 per cent of the crop. However. that percentage is expected to increase after the United States Department of Agriculture's decision last year gave the green light to sugar beet planting before an environmental impact statement was completed.

These percentages indicate the high uptake of GM crops within the United States. Certainly, locally, we have the investigative labs, including the Plant Accelerator at the Waite Research Institute, which is in the Adelaide Integrated Bioscience Laboratories. The Plant Accelerator is a cutting-edge plant phenotyping facility located at the University of Adelaide's Waite campus.

As a node of the Australian Plant Phenomics Facility, the Plant Accelerator offers modern plant growth environments and state-of-the-art, high throughput automated imaging and computing technologies to monitor the performance of plants under different environmental conditions—for example, which genotype performs best under drought stress. The facility offers professional consultation on plant phenomics and experimental design, backed by dedicated bioinformatic support with data management and analysis.

The AIB lab is also fitted with four fully-automated greenhouses (smart houses) tailored with conveyor systems and programmable watering stations with 34 modern high-quality greenhouses, including quarantine and genetic modification approved facilities. I understand that one side of the Plant Accelerator system is dedicated to genetic modification.

I also note that in around 2006 ministerial exemptions have been given for a limited controlled release of GM herbicide tolerant hybrid crops; this includes canola and mustard. The proposed sites in South Australia included Kingston, Mount Gambier, Naracoorte, Lucindale, Grant, Robe, Tatiara, Wattle Range and Lacepede. I understand that there has been seed grown out in the Mount Gambier district, under licence.

As stated previously, genetically-modified cotton has been grown commercially since 1996. GM cotton has been modified so that it is insect resistant, herbicide tolerant, or both. Residues of agricultural and veterinary chemicals can legally only be present on food if they are compliant with maximum residue limits (MRLs). MRLs provide the specifications of how much residue is allowed to remain on a harvested crop after the chemical has been sprayed and ensures that residue levels are kept as low as possible.

Cottonseed oil also has many uses and is heavily produced. In 2017, 134,000 metric tonnes of cottonseed oil was produced with a growth rate of 14.53 per cent. The following statement is an extract from a publication I have come across, entitled Uses of Cottonseed Oil:

This vegetable oil is frequently used for frying, deep-frying, and baking. Because of its neutral taste, cottonseed oil is said to enhance the natural taste of food, unlike other oils.

Cottonseed oil is a familiar feature of processed foods, which I absolutely recommend you avoid if you want to achieve true health. It's a popular ingredient in margarines, icings, and whipped toppings, because it helps form beta prime crystal, which promotes the ideal texture and creamy appearance of shortenings, spreads, and similar products. Cottonseed oil is also added to salads.

Other processed foods that use cottonseed oil as an ingredient include potato chips and French fries, baked goods, cereals, mayonnaise, [stir-fries] and oriental dishes, and spicy foods.

Certainly in restaurants and fast-food shops across South Australia, cottonseed oil is used to fry chips—

Mr Treloar interjecting:

Mr PEDERICK: —yes, absolutely—and 93 per cent of the cotton grown is genetically modified. The article continues:

Cottonseed oil is also used in personal care products such as soap and cosmetics. Soap produced with cottonseed oil was found to be adapted to washing wool. The oil from cottonseed is also added to laundry detergents. Other products where cottonseed oil is used range from rubber to insecticides and explosives.

Canola is also an approved genetically-modified, herbicide-tolerant crop and was approved for commercial production in 2003 on a worldwide basis. Canola oil is used on many dairy-type spreads and blends. Along with Australian-grown genetically-modified products, there are also imported GM foods. Food Standards Australia New Zealand (FSANZ) allows manufacturers to utilise a range of GM food ingredients imported internationally. Such products can include GM varieties of soy beans, corn, rice, potatoes and sugar beet, and these products will be all over your supermarket shelves.

GM technologies are constantly developing, and other states are well advancing in that respect. For instance, if a farmer has a crop growing really well and then experiences a frost, they would lose an entire crop of barley, wheat or canola. However, there is potential to develop frost-tolerant, drought-tolerant and salinity-tolerant crops. I have also been advised that a lot of work is being done on potatoes and grapes becoming disease resistant and, even further, there is research being done on allergen-free nuts.

There are many other genetically-modified options advancing, and I am sure these will continue to develop well into the future. Other benefits of GM crops around the world have also included lowered farm level production costs and higher crop yields, increased farm profits, improvements in soil health, and reduced CO2emissions from cropping. On a state-by-state basis, Western Australia is experiencing the biggest uptake of GM technology in Australia. When the 2010 permission was given for commercial planting of GM canola, 317 growers planted around 72,200 hectares. Since then, the proportion of commercial genetically-modified canola grown has been steadily increasing.

In 2015, Monsanto reported that Victorian farmers purchased 108 tonnes of the company's Roundup Ready Canola seed, up 15 per cent on the previous year. That level of planting accounts for about 13 per cent of Victoria's overall canola crop. Overall, states able to access GM technology have been able to adapt more efficiently to extreme climactic conditions, and require less pesticides, water and fertiliser than conventional crops. There is also GM technology which could address vitamin deficiency of the world's malnourished.

Whilst I have acknowledged some of the benefits genetic modification presents, safety requires paramount consideration also. Food Standards Australia New Zealand (FSANZ) established a rigorous and transparent process for assessing the safety of GM foods. FSANZ undertakes a thorough safety assessment of all GM foods prior to them being allowed in the food supply. This safety assessment is distinguished through case-by-case consideration of GM foods, consideration of both the intended and unintended effects of the genetic modification, and a comparison with conventional foods having an acceptable standard of safety. The following statement is an extract from the FSANZ website:

Many of the food safety issues raised by GM foods are equally applicable to foods produced by conventional means. GM foods are however subjected to a safety assessment before they are permitted in the food supply. The safety assessment includes extensive analyses of the composition of the food, a full consideration of the safety of any new substances that have been introduced into the food…as well as a thorough characterisation of the genetic changes that have been introduced into the organism from which the food is derived. This ensures that any GM food that is approved is as safe as food already in the food supply, including in the long term.

To date, gene technology has not been shown to introduce any new or altered hazards into the food supply, therefore the potential for long term risks associated with GM foods is considered to be no different to that for conventional foods already in the food supply.

As well as the safety assessments previously described, the Office of the Gene Technology Regulator (OGTR) is the federal government body responsible for the national scheme to regulate genetically-modified organisms (GMOs) in Australia. Under the Gene Technology Act 2000, the OGTR administers some of the toughest legislation regarding GMOs in the world. Breaches can result in potential fines of more than $1 million per day.

Given that we are debating genetic modification, I must also refer to the comments made by the Minister for Agriculture. The minister claims that, by South Australia remaining GM free, all South Australian exports receive a premium in overseas markets, though to date the minister has provided no data or advice to quantify or substantiate his claims that all South Australian exports receive a premium as a result of South Australia's genetically-modified free status. The minister even commissioned a report by the University of Adelaide to investigate his assertions. Ultimately, the report does not address the claims that all exports receive a premium as a result of this state being GM free.

Furthermore, I would like to reflect on a contribution made by the Hon. Robert Brokenshire in the other place. The honourable member indicated that agricultural commodity prices between South Australia and other states do not show any evidence—any evidence—of a premium price for this state being GM free. The honourable member in the other place continued his remarks in this regard, stating that he was required to sign a sustainable canola declaration to prove that South Australia has the cleanest, greenest and most sustainable canola in the world, yet there are no additional premiums for this status.

The opposition's policy of having a high-level expert investigation would consider all matters relating to genetically-modified canola, including the statements made by the minister in relation to this so-called added premium. During estimates this year, we questioned the minister about a GM breakout. I note from the comments made in the answer by Will Zacharin from the department that on 22 May 2017 Biosecurity SA became aware of a report from a Mid North farmer of a number of self-sown or volunteer canola plants that had survived a spray of glyphosate while others in the paddock had died.

It went through the investigative process, and these plants were determined to be genetically modified. Obviously, there had been an issue with the seed, and some genetically-modified seed had come in. From what I understand, it was not just one round of Roundup. A grower tried to kill these plants. He went over several times. Obviously, they were Roundup-resistant. The issue is that this was not over a small area: this was over 500 acres, or 200 hectares, a significant portion of land that now has had genetically-modified canola on it.

The Productivity Commission's draft report of July this year into the regulation of Australian agriculture unequivocally states that there are no economic, health or safety justifications for banning the cultivation of genetically-modified GM organisms. Draft recommendation 6.1 stated that all state and territory governments should also repeal the legislation that imposes or gives them powers to impose moratoria on the cultivation of genetically-modified organisms by 2018. It went on to say that some regulations lack a sound policy justification and should be removed, including state bans on cultivated genetically-modified crops and that there is little evidence of GMO-free marketing benefits at bulk trade level.

In my experience as a farmer before entering this place, and having an issue with wild radish on my property, I had no choice but to use a lot of chemicals on my canola crops and I had to use triazine-tolerant (TT) varieties. You take a bit of a yield hit using triazine-tolerant varieties because they have to have that built-in triazine tolerance. You go out with a fair lick of simazine and then follow up with atrazine later on, early in the crop growth. It does work and it is very effective.

I am going from memory now, but the recommendations were about 3½ litres of triazine per hectare. I think it was two litres first-up and probably six or so weeks later 1½ litres of atrazine. Because the regulators were concerned with the build-up of triazine in the soils, they reduced the label rates. I can tell you from experience that they are not effective. I understand why the label rates were reduced, but if it does not work it is not much chop going with a lower rate.

That is an issue because there is a lot of country in South Australia, as there is in Western Australia and through other states in this country. I am certainly well aware of how much wild radish there is in WA, but it would be right through Victoria, New South Wales and probably into Queensland. It is—I was going to swear but I will not because I am here—a darn weed; it is a beggar of a thing. It just keeps regrowing. There is hard seed in the ground and you have to use triazine-tolerant canola seed to grow a clean and profitable crop.

What has happened with the Western Australian experience—where they have been able to use Roundup-Ready canola for quite a while now—is they can go in with Roundup, which is a lot safer than triazines and a cheaper option. Certainly it is another option, another tool, in the kitbag for Western Australian farmers in their farming program.

Canola is not grown year in, year out. It could be a three-year rotation, a four-year rotation or a five-year rotation—so, every three, four or five years. Several years ago there was a drought in Western Australia and some of the only profitable crops on some farms were the genetically-modified canola. They sowed it with very little rain because they knew that they could take all the weeds out with Roundup once everything germinated and, in fact, a lot of it went in dry, as a management tool. Because people have so many acres or hectares to put in they need to get on with the job and in a lot of cases that was the only crop that made them any money at all.

As I said, with trials and the Plant Accelerator experience, whether it be in the genetically-modified zone or the normal crop-breeding zone, to get salinity and drought tolerance into any grains or canola would be a huge win—a huge win if it can be pulled off—for the agriculture industry.

Salinity and drought, certainly in Western Australia, are two of the biggest issues, but they are also issues here. We always have droughts around the place. I note that in Canada there has been some talk about premiums. Japan will not take canola unless it is non-genetically modified. Canada pretty well sells all their canola commingled and they sell a lot of it to Japan.

I have talked about the Productivity Commission report. In regard to the ban in South Australia and what it does as far as getting seed from the Eastern States through to Western Australia or whether it is grown under licence in Mount Gambier, I know that Webb transport in MacKillop and Tintinara cart a lot of this seed. They have to go right around South Australia and up through the Northern Territory to get this seed to Western Australia, which I find absolutely ridiculous. Getting this seed there puts a huge cost on the other end, for the Western Australian farmers.

I have opened plenty of canola seed bags. They are probably triple-strength material and stitched right up. They would be packed in plastic, tied up and put inside container trucks. Unless you had a devastating crash, nothing would happen. It just seems amazing that, because of the ban in this state, this seed has to go right around the state as if it is some big bogeyman out there in the field.

I am certainly keen to hear what the minister has to say about the recommended next steps in regard to the University of Adelaide's Centre for Global Food and Resources' Final Summary Report. Three of the recommendations include:

1. Invite South Australian businesses interviewed as part of the study to a presentation and discussion of the findings.

2. Liaise with Food SA to include the highlights of the findings in the industry workshops it will be conducting as part of developing their 'Growth through Innovation Strategy'.

3. Depending on sufficient industry support, provide a briefing to relevant Government Ministers and Executive staff on the findings and implications for Government programs.

I would certainly be interested to know whether any of these recommendations have been implemented and what the government's original thoughts were about extending this moratorium until 2028 because clearly we do not actually have a government policy that is unreviewed and not looked at for more than two decades. I am interested in the minister's response to that.

As I indicated, we oppose the bill. I have indicated what we will do if we come into government. I am a farmer and have declared that. I look at the tools that can be used elsewhere. I look at the uses of genetically-modified foods not just in the first but where they are used for add-ons to processed food, such as cottonseed oil which is used in many deep fryers across the state.

Certainly, there would be a huge array of foods with genetically-modified ingredients that people would buy every week off our store shelves in South Australia and they would have no idea that they were genetically modified. Obviously, they do not have any health effects. Looking at some of the health reports I commented on earlier in this contribution, I know that there are no reasons to have this moratorium. It just seems that emotion gets in the way of reality. On this side of the house, we would like to see science and economics come to the fore so that we can see the true reality. With those remarks, we oppose the bill.

The Hon. P. CAICA (Colton) (12:59): I will be very quick in seeking leave to continue my remarks. If that contribution was meant to have us reconsider lifting the moratorium on genetically-modified crops in South Australia, it did not work. It is more a reason for us to do exactly what we are doing by this bill. I seek leave to continue my remarks.

Leave granted; debate adjourned.

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