UNITED STATES DEPARTMENT OF AGRICULTURE

WASHINGTON, D.C.

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ADVISORY COMMITTEE ON :

BIOTECHNOLOGY AND 21ST CENTURY :

AGRICULTURE (AC21) :

FIFTEENTH PLENARY MEETING :

:

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A meeting in the above-entitled matter was held on Monday, March 26,
2007, commencing at 8:30 a.m., at the USDA, 1400 Independence Avenue,
S.W., Washington, D.C. before:

Dr. Michael Schechtman, Designated Federal Official, USDA

[A P P E A R A N C E S]{.underline}

Abby Dilley, RESOLVE

Kathy Grant, RESOLVE

Cynthia Sulton, HW&W

[MEMBERS OF THE AC21 PLENARY COMMITTEE]{.underline}

Patricia Layton, Chairperson, Absent

Russell Kremer

Sarah Geisert

Carol Tucker Foreman

Duane Grant

Margaret Mellon

Elizabeth Milewski

Adrian Polansky

Alison Van Eenennaam

Kathleen Jones

Nicholas Kalaitzandokes

Bradley Shurdut

Daryl Buss

Jerome Slocum

Randal Giroux

Russell Kremer

Guy Cardineau

Stephanie Whalen

Lisa Zannoni

Leon Corzine

Nancy Bryson

Michael Dykes, Absent

Greg Jaffe, Absent

Steven Poeppke, Absent

[PRESENTATIONS]{.underline}

[Page]{.underline}

Dr. Ronald De Haven

Administrator, APHIS 47

Catherine Greene,

Economist, USDA 101

OTHER USDA SPEAKERS

Cindy Smith 47

Deputy Administrator, BRS, APHIS

Rebecca Bech 47

Assistant Deputy Administrator,

BRS, APHIS

[P R O C E E D I N G S]{.underline}

DR. SCHECHTMAN: Welcome and good morning. This is the 15th meeting of
the U.S. Department of Agriculture\'s Advisory Committee on
Biotechnology and 21st Century Agriculture or AC21. My name is Michael
Schechtman and I\'m the Executive Secretary and Designated Federal
Official for the AC21.

To my right and left are our facilitators, Ms. Abby Dilley and Ms. Kathy
Grant from the organization Resolve and next to me, Ms. Cynthia Sulton
from the organization HW&W, who are our partners in helping us make the
advisory committee process work.

The AC21 Chair, Dr. Patricia Layton, who is also Chair of the Department
of Forestry and Natural Resources at Clemson University will not be here
at this meeting because she suffered a complex break in her leg last
week and is awaiting surgery at present. We all wish her well, I\'m
sure, and she promises to be back next time.

As provided for under the Federal Advisory Committee Act, as Designated
Federal Official for the AC21 I will chair the committee for this
meeting in the absence of Dr. Layton. A bit later this morning we will
also be pleased to have Dr. Ron De Haven, the Administrator of USDA\'s
APHIS, the Animal and Plant Health Inspection Service here, to talk
about two issues. One is a follow up on the transgenic rice issues this
committee has been following and the second is with regard to a recent
court decision relating to APHIS\' Environmental Assessments for
deregulation of a transgenic alfalfa line. These will be very
interesting and relevant updates for the committee.

I\'d also like to welcome our committee members, I believe seventeen of
whom should be here today, including three new members of our committee,
Bowen Flowers, Guy Cardineau, and Stephanie Whalen who will introduce
themselves in a few minutes. Welcome to our discussion and, of course,
welcome to our *ex officio* members, several of whom I expect but none
of whom I see have arrived as yet.

I should also mention with regret that Josephine Hunt has been moved to
a different portfolio within her company and has left the committee.
Also, Greg Jaffe and Steven Pepke are out of the country at the moment,
one near the Arctic Circle and the other in Africa and won\'t be here
for this meeting. If you heard my phone ring before I shut it off a
moment ago that was Michael Dykes telling us that he\'s not going to be
able to be here today but will be here tomorrow.

We will, as usual, have a very full agenda so we ask that when the
meeting is in session, conversations need to be limited to those between
members. The public will be invited to participate by providing comments
to the committee and USDA this afternoon between 3:30 and 4:45 p.m.
Members of the public who request to speak during the public comment
period I will need hard or electronic copies of your remarks. We will be
preparing the minutes of this meeting and a computer transcript of the
meeting will also be available within about six weeks or so. We hope to
get the minutes and all meeting announcements up on the Web.

The AC21 has a website linked to the overall USDA website. It can be
reached through USDA\'s main biotech portal via the main USDA website at
www.usda.gov by clicking on agriculture, then clicking on biotechnology
and then on the committee name. For any members of the press who may be
in attendance you\'re welcome to speak to whomever you wish during the
breaks of our meeting and before or after the meeting itself but we ask
that you not conduct any interviews or request comments from members
while the AC21 is actually in session.

I will be available for questions and comments at the end of each day of
the meeting. I would like to request that all members of the AC21 as
well as members of the audience and the press who should be here please
shut off your cell phones and beepers while in the meeting room.
Bathrooms are located on either side of the patio just outside the door,
women on the near side and men on the far side.

For the information of members of the public let me indicate that the
AC21 has two distinct charges from the Secretary of Agriculture in its
charter. First, examining the long-term impacts of biotechnology on
agriculture and the work of USDA which the AC21 has interpreted to mean
over the next five to ten years and, second, addressing pressing
specific biotechnology related issues identified by the Secretary.

The committee last year completed a significant piece of work dealing
with that first charge and the resulting document entitled
\"Opportunities and Challenges for Agricultural Biotechnology, the
Decade Ahead\" was presented to the Deputy Secretary of Agriculture two
meetings ago. Over the next two days the committee will continue its
work on its next project which might be considered to fit under either
charge of the committee on the impact of coexistence considerations for
agriculture. The committee will be reflecting on the discussions from
the last meeting considering work done by the members of the session
both in drafting pieces of text and in commenting on the assembled
compilation, including what to do with relevant portions of what I might
call old issues discussed in previous reports in some way that adds new
value and listening to and reflecting on two presentations on relevant
topics from some outside expert speakers that might provide supplemental
information to include in your paper, all this in the context of
preparing a concise, focused document.

I\'ll have more to say about the upcoming work later. Just outside the
room there\'s a table with meeting documents and background documents on
them. Please take only one copy. For this meeting we have a series of
documents. There are a number of background documents outside and they
include the official AC21 committee charter. Note that the charter has
been renewed for two more years. The AC21 by-laws and operating
procedures. A package of biographical sketches of all of the current
AC21 members, old and new. The draft meeting summary prepared from the
14th AC21 meeting held on December 14-15, 2006. Three documents that
were provided to you by USDA to committee members as background
information in an attempt to fulfill some information requests by
committee members and they are the first a paper by Brian Endress
relating to legal issues and options around coexistence as a supplement
to lead the discussions we had last time and the other two are
information about the state of coexistence discussions or perhaps the
continuing coexistence controversy in the European Union.

One, a compilation of information from a few web sources within the
European Commission and outside of it about the state of regulation and
the reaction to it and the other an article providing a somewhat
skeptical view of the history of the debate around Europe. Both of the
reprinted articles that I mentioned have been provided to you with
permission of the office.

There\'s also a document that is a compilation of four USDA notices.
Three press releases and one Federal Register notice relating to two
issues on which Dr. De Haven will be speaking to you in a little while.
I should mention those are quite current. Three of them are from last
week.

Finally we have as background information for the public the earlier
three reports that have been developed by consensus in 2005 and 2006 by
this committee on the table. Now, specific to this meeting we have just
a couple of official documents. First, we have, of course, the
provisional agenda for this meeting. The version that you receive is
just very slightly modified from the one that was sent to you earlier.
Second, there\'s a document made up of compiled texts developed by sub
groups of committee members on relevant areas that were identified last
time and that compilation was circulated back to members and comments
were solicited and the document that\'s outside contains all the
comments and changes that were provided by members or suggestions. Now,
this document was circulated to members on March 8th. I\'ll have more to
say about the document later this morning, how it came about, what its
status is, and how to interpret it when we turn to the work at hand in a
little while.

But, for now, let me just thank committee members, drafters, and
commentors for their work. Please note on the agenda for this meeting
that there are breaks scheduled this morning and afternoon. For members
of the public who wish coffee, coffee is available in the cafeteria
downstairs. Also on the agenda, let me note again that we\'re planning
for a period of one and a quarter hours for public comments between 3:30
and 4:45 p.m. today. We want to be responsive to the needs of the public
and we want to see as the meeting progresses how we need to structure
that time. If there are no cementers, we\'ll undoubtedly find other uses
for that time.

Members of the public, if you wish to make a comment and haven\'t done
so already, please be sure that you have signed up at the door so that
we can plan for that time. From USDA\'s perspective we have a few main
objectives for this meeting. They are, first, the further work on the
coexistence topic framed around the question in an increasing complex
marketplace what issues should USDA consider regarding coexistence among
increasing diverse agricultural systems. Second, to consider
presentations from two speakers from outside the committee and review a
compilation of draft submissions on a series of sub-topics for
production of a paper on the topic, and, third, determine the next steps
and a continued work plan for effort between this and the next committee
meetings.

We\'ll also do one other thing, as I mentioned before, offer committee
members a brief opportunity to be briefed and to ask questions of the
APHIS administrator regarding the transgenic rice issue and the
transgenic alfalfa ruling. We\'ll do that around 10:00 a.m. to fit
within Dr. De Haven\'s schedule. Now, before we turn to the substantive
work at hand, I have some committee business to which we must attend,
some updates and some past.

First, the committee charter was renewed in February as it has to be
every two years. Two more years of life. Second, committee membership.
The continuing members will recall that most members have been appointed
in February but that one year, some members were appointed in April
because of the paperwork delay on our part. Given that member terms have
been up to this point one or two years, some members\' terms go around
and expired in February and some will expire shortly in April because up
until this appointment cycle we were limited by charter to fix one or
two year terms for members, no longer.

For this appointment cycle, we\'ve made some appointments in February
and with some terms expiring April there will be additional appointments
in April as well and we will address terms of membership so that in the
future everyone\'s term will end in February. I would note that Carole
Kremer and Josephine Hunt have already left the committee and Lisa
Zannoni, who I see here, did not apply for \-- did not reapply for
membership on the committee.

The following members whose terms expired in February and who you do see
now or will see here during this meeting were reappointed, Michael
Dykes, Jerry Slocum, and Leon Corzine. A couple of other housekeeping
issues. Among the requirements for federal advisory committees is that
efforts be made to follow equal employment practices in constituting
each committee. As part of that effort outreach activities are made to
arrange with relative institutions so that the minorities and
disadvantaged communities in soliciting nominations. This is an ongoing
process. We are also requested by our Office of Civil Rights to provide
you each with a pair of forms, filling out of which is strictly
voluntary, which gather data on the ethnic makeup and handicap status of
members of advisory committees. There\'s a copy of each at members\'
places, not at the places of ex officio members.

This information in no way affects your status on this committee but it
is used in accordance with OMB\'s reproduction of reports on the overall
makeup of the government workforce as its subgroups and it may be used
in seeking out individuals who may be in special populations that may
receive other voluntary personnel surveys. I will have two accordion
folders up at my place at the table each day, one labeled for
self-identification of ethnicity and one for self-identification of
handicap.

If you should choose to complete the forms, please place them in the
correct folders sometime over the course of these two days. I will
deliver them to the Office of Civil Rights. Finally, in terms of
committee business, members will remember having heard from me on one or
more occasions about the classification of committee members as either
special government employees or representatives in accordance with
federal ethics requirements.

I will note for those members who have been newly classified as special
government employees for this purpose that you should have just received
from me some information, rules that you\'ll need to review and
disclosure information that you need to provide to the government. This
has been sent to you, I confess, a little bit later than it should have
been, but, please take care of filling out the forms and returning it as
directed promptly. Thank you very much.

Before I turn to the discussion of the work at hand I\'d like to ask the
newest members of our committee, Bowen Flowers, Guy Cardineau, and
Stephanie Whalen to briefly introduce themselves and each tell us what
they see as their role on the committee and then I\'ll continue with my
remarks. So, if I could.

MR. FLOWERS: I\'m Bowen Flowers from Clarksville, Mississippi. I\'m a
\--

DR. SCHECHTMAN: Actually, if you\'d like to sit down, it\'s probably
would be easier to pick up on the microphone.

MR. FLOWERS: I\'m from Clarksville, Mississippi. I\'m a partner in Omega
Plantation. We manage 14,000 acres of crops, cotton bean the main crop,
wheat, corn, and soybeans. I\'m a director on the board of the National
Cotton Council. I\'m on the American Cotton Producers Executive
Committee; on the Board of Staple Cotton, a co-op marketing firm for
cotton. We market right at 14 million bales of cotton and just looking
forward to being on the committee and seeing what I can add on to the
discussions.

DR. SCHECHTMAN: Thank you.

MS. WHALEN: My name is Stephanie Whalen. I\'m with the Hawaii
Agricultural Research Organization which is a trade association for the
sugar industry in Hawaii. We\'ve been around for over 110 years and we
do work not just for the sugar industry though but for other crops. It
has always been the intention of our organization to look at further
possible and increased agricultural activity on the Island.

I attended the workshop recently on specialty crops in biotechnology and
this discussion was really on the access to the technology of specialty
crops and the concerns that the regulatory process and IP that needed to
get through the process and this was made up mainly of specialty crops.
We have a great interest in being sure that their technology is
preserved or available to the specialty crop areas and we recently had a
coexistence discussion but it was strictly farmer-to-farmer at the table
and so that happened last year.

The report went to the legislature and we expect that to continue.

DR. SCHECHTMAN: Thank you.

DR. CARDINEAU: I\'m Guy Cardineau. I\'m a professor at Arizona State
University where I have appointments in the Biodesign Institute of Life
Science and the College of Law. I\'ve been there for about four years.
The previous years I spent in industrial biotechnology starting in 1983.
I worked for a series of four companies. It\'s the small fish getting
swallowed by the bigger fish, Mycogen and Dow Agrosciences. I spent my
entire career in agricultural biotechnology. Have been involved in
bringing several products into the marketplace in insect-resistant corn
and insect-resistant cotton and the only plant-made pharmaceutical
approved by the USDA, which is a vaccine against the Newcastle disease
virus.

DR. SCHECHTMAN: Thank you and welcome all three of you. To help our new
members and members of the public in attendance identify who else is on
the committee, why don\'t we just quickly go around and ask every member
to identify him or herself and simply indicate their affiliation.

MR. KREMER: I\'m Russ Kremer. I\'m president of the Missouri Farmers
Union and I\'m an agriculture producer from Missouri.

MS. GEISERT: I\'m Sarah Geisert and I\'m with General Mills.

DR. BUSS: Daryl Buss from the School of Veterinary Medicine at the
University of Wisconsin, Madison.

MR. GIROUX: Randal Giroux, Cargill.

DR. VAN EENENNAAM: Alison Van Eenennaam, Department of Animal Sciences
at the University of California, Davis.

DR. JONES: Kathleen Jones, U.S. Food and Drug Administration, Center for
Food Safety and Applied Nutrition.

MS. ZANNONI: Lisa Zannoni with Syngenta.

MS. BRYSON: Nancy Bryson, Former General Counsel of USDA.

DR. POLANSKY: Adrian Polansky, Secretary of the Department of
Agriculture representing in this case the National Association of State
Departments of Agriculture.

MS. TUCKER FOREMAN: Carol Tucker Foreman, Consumer Federation of
America.

DR. SHURDUT: Brad Shurdut, Dow Life Sciences.

MR. GRANT: Duane Grant, another farmer from Idaho. I do work with sugar,
wheat, and potatoes.

MR. SLOCUM: Jerry Slocum from North Mississippi where we farm with
country grain elevators and I represent the United Soybean Board and
American Soybean Association.

MR. KALAITZANDONAKES: Nicholas Kalaitzandonakes, University of Missouri.

DR. SCHECHTMAN: Thank you. Let me just mention that you all are not
quite so fortunate to have a microphone in front of your place that
amplifies for this process so I\'d like to ask everyone to speak up
please. It makes the transcript more readable later on.

Now, I\'d like to say a little bit about the work ahead of you for this
meeting and there will be a lot to do and a spirited and interesting
discussion I have no doubt. As a committee you\'ve continued to produce
significant reports that have been all the more valuable for the range
of views you\'ve incorporated in them. I know that all the reports have
been read widely within USDA and the ideas incorporated in preparing for
the future reports have been used as envisioning work in some agencies.

Your current effort on coexistence will be one more piece on the whole
continuum of your effort. It will be in one respect a paper that fills
in some of the gaps by some of the previous three papers. Maybe it can
be considered a bookend to the initial set of reports, but, this is an
important topic. We\'ve already gotten a sense in previous meetings that
this is so and that we probably wouldn\'t have been sent the topic to
consider if it weren\'t. The paper that you\'re preparing is not going
to solve or resolve these issues. We\'ve asked you for your insight and
collective understanding rather than specifically a recommendation.

We will need the lay of the land for you. The sense of things that USDA
will be faced with considering so that we can understand some topics
better. From USDA\'s perspective, as I have said previously at past
meetings, we would like a paper that is relatively concise and that is
focused with attention to avoiding the duplication of materials from
previous reports. Your discussions at your committee meeting got us
moving in the right direction, framing the issues with the observation
that coexistence is happening, reflecting on what is fostering and what
is hindering or challenging to continue coexistence, and beginning the
conversation about removing subjects that are interesting and perhaps
important, but tangential to coexistence per se.

On a nuts and bolts level, at this meeting you\'ll have to address a
number of issues at this meeting in order to move forward. They include,
in no particular order, deciding whether the compilation, which we\'ll
talk more about in a few minutes, can serve as the basis to work from,
adding, subtracting, and editing. And from my point of view it would be
good to have a green light to start regardless of how much it needs to
be changed to come to a final product.

Second. Deciding what to do with topics covered in previous reports and
how to extract any information on those topics that will add value to
the previous work. Excuse me, add value in the current work.

Third. Deciding what additional topics might need to be addressed or
included in the existing materials based on the presentations you\'ll be
hearing today and tomorrow or based on any of the background materials
that we\'ve provided to you.

And, finally, describing the different viewpoints of what coexistence
means or from which coexistence is viewed, whether it\'s an end result
or process, or whether or not it\'s been completely successful or is
entirely desirable depending on what you see. What have you heard so
far? We\'ve heard from a number of presenters in the last two meetings
that at least in some senses coexistence is occurring. There have been
presentations that have indicated that products are being supplied to
meet market demands for commodity product, to differentiate non-biotech
product, and for organic products which may vary according to both
country and buyer requirement. This is, I think, very important.

The biotech and the organic sectors are growing. Providing the widest
range of choices to farmers and consumers though makes for a very
challenging mix. We\'ve heard about the role of farmer-to-farmer
communication and neighborliness in helping many of the potential farm
level issues get resolved before they\'re, in fact, issues. We\'ve also
heard concerns raised about the need to make sure that the market is
responding, or will adequately respond, to signals provide seed to
diverse markets, about niche market needs potentially being overwhelmed
by the growth of commodity demands, particularly for biofuels, and about
future potential inadequacies in the infrastructure that the U.S. would
need to move and to store product to meet diverse demand.

We\'ve also heard about the needs for the future, in which markets are
functioning and consumers are getting what they want but some production
of products of specialized markets has moved offshore, whether because
of labor difficulties or because of production issues. Some are
skeptical that the concept of coexistence is achievable. As we know, and
we will hear more about segments of the population that simply do not
want biotech products and have the expectation that they will be able to
obtain essentially biotech-free products. That could become an
increasingly tough demand to fulfill.

If the markets are working and production moves offshore for some
products has coexistence failed? Should we even consider it an
achievable objective rather than a process? If some production moves
offshore is it a market failure or is the assumption that every farmer
should be able to grow anything that he wants an unrealistic one and is
it reasonable to assume that consumers should have access to anything no
matter how small the market?

We\'ve seen boundaries put around the assumption in some instances in
growing canola and rapeseed in the Northwest for example. Obviously, we
don\'t think it\'s a reasonable desire for a farmer in Vermont who wants
to be able to grow rice out of doors. He can try. If a consumer wants
completely GE-free product, but, doesn\'t want to pay extra, is that a
reasonable choice? What are the boundaries of what is reasonable? Would
adding any additional boundary conditions be something that USDA may
wish to consider, and, if so, on whom might each set of boundary
conditions be imposed? Any such condition, no matter who placed them on
any of the parties in this issue, would not be something to be imposed
without much thought and compelling evidence that such action was
appropriate and necessary.

I don\'t want by these questions to give you the impression that USDA is
considering any of these things, but, I think that\'s part of the
discussion that you\'re having around the table. The committee had
talked about coexistence as a state where consumers have choice in
products available and farmers have choice to purchase or grow what they
want. Are these two requirements at their extremes, sometimes in
conflict with one another? If they can be under some circumstances, how
can that problem be looked at in the productive way?

We\'ve seen the example of the EU and they have, I think it\'s fair to
say, struggled with addressing coexistence country-by-country in a very
formal way and where regulatory policies have emerged they\'ve made it
very difficult for farmers to plant biotech crops. The situation is
different in the United States and there are a range of products
available for consumers here, but is our current situation robust and a
stable one? What does USDA need to be thinking about?

So, there are lots of things on your plate. At this point it\'s worth
remembering though what this committee does best, incorporating the
different perspectives this committee as a whole brings to issues, and
focusing on what is most important, capturing issues in a way that
reflect the diversity and points of views of committee membership, not
necessarily resolving it. I see that we have some enthusiasm from our
new members entering this discussion and I expect all three of you to be
active participants right off and I\'m looking forward to a lot of
progress at this meeting and I\'d like to be able to say that we have a
great deal of work over the next two days and between this meeting and
the next one that we\'ll be able to wrap up work on this topic at that
time.

So, with that I will turn this over to our facilitators for an overview
of the agenda and summary from the last meeting.

MS. SULTON: Just a brief summary. Cindy Sulton. Just a brief summary
from our meeting of December 14-15, 2006. You all have received it and
so I\'m going to briefly summarize it and ask for any questions or
modifications. At that meeting after our preliminary introducing just a
few new members we had a general discussion of the committee\'s charge
and during that discussion, among other things, the committee reaffirmed
that the scope of the charge would include perspectives from producers,
consumers, and customers and that the main focus would be the domestic
market.

The committee also discussed possible, possible solutions to facilitate
the charge with the discussion of what\'s happening now with working of
what\'s likely to change potential of what we call the impinged point of
barriers and legal issues. The solutions, opportunities, and potential
policy options. In addition to that discussion or that discussion \--
along with that discussion were presentations on coexistence, the first
of which was by Drew Kirshen from the University of Oklahoma College of
Law. Kirshen spoke on the legal mechanisms relevant to coexistent
issues.

A second speaker was Dr. Bernice Slutsky, Vice-President of The American
Seed Trade Association who spoke on assuring a diverse seed supply. The
third and final speaker was James Stitzlein, manager of Market
Development at Consolidated Grain and Barge and he spoke on
transportation and infrastructure for addressing coexistence needs.
There was also a rather robust discussion with all of those speakers.

Then the committee turned to the review of the draft concept paper on
potential topics for inclusion in a paper on coexistence. And we started
from topics that had been identified in our August 2006 plenary and
expanded upon in a concept paper drafted by Nick in that we addressed
market infrastructure, uniform standards, compliance, and stewardship,
market information and transportation, and then moved on to discussing
what our next steps would be to actually complete the paper.

It was agreed that we would have some drafting groups and those drafting
groups would submit papers that would be consolidated by the staff and
that\'s how we got to the draft we have here today. Basically, that\'s a
summary of what we did. Are there any questions, any corrections to the
minutes?

DR. VAN EENENNAAM: I note that I was listed as being there and I think
Daryl\'s not listed as being there and he was.

MS. SULTON: Then that\'s a correction that we shall make. Thank you.
Sorry about that. Any other comments on the minutes? We\'ll leave them
open for about a week and if we don\'t get any further comments we\'ll
just assume that they\'re approved if that\'s all right with the
committee and then they\'ll be posted on the web. Thank you. Abby.

MS. DILLEY: Moving to the agenda, as Michael has already gone through
the objectives for this meeting, and I just want to go briefly through
what we had proposed for this meeting. The agenda requests a combination
of things so it\'s an eye towards meeting those objectives over the next
two days and bringing the new information to the committee and working
with their schedules and trying to sort through how best to use the
materials we have developed so far and then build on the conversation
over the course of the new few days and then beyond this meeting and
working towards closing out this topic after the next meeting in the
time frame the Secretary had given the committee through early summer as
I remember, late spring, early summer with the anticipation that the
committee would take on a new topic at that meeting so sometime at the
end of the summer.

With that in mind we have just, again, a quick review of the agenda. We
will have some time this morning re-grounding ourselves in terms of the
way we\'ve been scoping this topic and doing our work and partly I think
at the beginning of a meeting to get ourselves re-grounded and on the
same page with what we\'re trying to do and how we\'re trying to do it.
Also, to bring along the three new committee members I think will also
be helpful.

And then also spend some time this morning talking about how we want to
proceed. We have about a half an hour at which time we\'ll take a break
from that discussion. I\'m sure we\'ll come back to it because we won\'t
complete that discussion in a half an hour, but, take a break so that
Dr. DeHaven can come in and provide the updates that Michael referenced
on rice and alfalfa and field some questions of the committee on those
two topics.

And then after a break pick up the discussion again in terms of our
scope and how we\'re approaching our work on coexistence. And then
we\'ll turn to the document work that\'s been taking place since the
last session and how we want to think about the document and also talk
about the products that we\'ve been using which Michael has already
referenced in terms of coexistence is happening. There are some
strengths, some challenges, are we making observations about that and
how do we want to move forward given some of the background information
we\'ve collected since the last meeting up to this point.

We\'ll take a break for lunch at noon and have a little over an hour for
a lunch break and then come back and right after lunch we have
presentation from the research \-- on research on the organic industry
from the Economic Research Service, Catherine Greene. So, after that
we\'ll move back to the document compilation, pick up our conversations
that we were having prior to lunch and then take a few public comments
between 2:30 and 4:45 after a brief break. I think Michael\'s already
mentioned if someone does want to make public comment please be sure and
sign up for that.

Also, for those of you who are new to the committee depending on how
long the public comment, how much public comment there is, and how much
time that requires we often use some of that time to come back and pick
up our conversation that we were having prior to breaking for public
comment. So, we will continue our discussions until five this afternoon
and adjourn for the day.

At that point, just prior to breaking to see where we are and to review
the agenda for tomorrow just to make sure that we\'re tracking and if we
do need to make some adjustments we\'ll do that at the end of the day.

Tomorrow we have another presentation which will set off our day from
Phil Lempert and then we\'ll pick up again where we are and where we\'re
headed with the document and how we\'re framing our work and that will
carry us through until after lunch when at which point we\'ll talk about
how we want to structure our work between now and the next meeting. We
also had requested that you bring your calendars. We know there are
several members who are not here and we\'ll need to coordinate with them
but if we can at least get two candidate dates around the June time
frame that would be exceedingly helpful because then we can \--

DR. SCHECHTMAN: July.

MS. DILLEY: In July time frame that would be very helpful so we can try
and zero in and confirm those dates as quickly as possible post this
meeting. So, if you don\'t have your calendars with you today if you
could get those for July and we can do that first thing in the morning
tomorrow before we start and we\'ll adjourn no later than four.

Any questions, comments before proceeding? Everybody have copies of
documents? I\'ll turn it back to Michael to talk a little bit about work
that\'s been done since the last session and then we\'ll move into a
discussion of scope and getting ourselves organized around the topic for
today.

DR. SCHECHTMAN: All committee members should have received a document
which is headed Coexistence Compilation as of March 8, 2007. It\'s also
available outside as a lightly colored document. Before you really get
involved in your deliberation let me introduce that paper, how it came
about, what its status is, and how to read it, information that ongoing
members may know but which may be useful for an amendment to the public.

You\'ll remember that at our December meeting the committee considered a
document that Nicholas Kalaitzandonakes on this committee put together
prior to that meeting, which attempted to organize the ideas that had
been discussed at the August meeting. Reflecting on that material the
committee decided last time on a slightly different grouping of ideas.
The committee decided on using the concept of potential pinch points as
at least place holders for areas where consideration to the future might
be necessary and work assignments were given to groups of committee
members to give some writing in several areas.

First was a framing piece talking about what the market is doing these
days, what is and is not working and perhaps why and perhaps what might
be challenged in the future. Then, in no particular order, were pieces
on potential pinch points in infrastructure, pinch points in market
structure and market access, and pinch points with respect to regulatory
standards, compliance, and stewardship. Groups of three or four members
each worked on the very first draft which I compiled and did a minimal
amount of editing on.

The compiled documents were sent out to two members for comment on
February 9th. Comments from some members were received over the next few
weeks. Not enough. And those comments and edits were compiled into the
text and sent back out to members for their consideration on March 8th.
So, the document that you have at this point is just a compilation of
submissions and comments without extensive editing though, as mentioned
in e-mails accompanying the compilation, with some very slight editing
for terminology, etc.

Committee members will need to consider whether it provides a basis from
which additional progress can be made. No word in the text is considered
to be agreed upon or anything in any sense at this point. Let me
describe how to interpret all the notations in the documents so you\'ll
know how to read it.

The document contains two forms of input from committee members,
comments and edit, all of which would need to be considered when you get
down to the nuts and bolts of the work if this is an acceptable place to
start. Comments are generally off to the side, though they were
sometimes so long or numerous that MS Word continued them onto
continuation pages at the end of the document.

Specific proposed changes to the text are represented by square brackets
in the text. These are the rules for interpreting the square brackets.
Alternative texts are represented with consecutive pieces of text, each
within its own square bracket. If there are consecutive alternatives the
first text will always be the initial version of the text and subsequent
ones are suggested replacements. Alternative texts are attributed to
members with their initials.

If there\'s only a single piece of square bracketed text it\'s a
proposed addition to the text and is attributed. Proposed deletions are
also attributed with the word "delete" or "deletion" in italics. It was
sometimes necessary in preparing the compilation to do a bit of nesting
of brackets, embedding some proposed smaller changes within larger
blocks of text. I\'m hopeful that it\'s going to be obvious what\'s
suggested in each case and I also hope that I haven\'t inadvertently put
any brackets in the wrong place.

There were very few minor and strictly editorial fixes that I made in
terms of grammar or usage that did not in my judgment affect the text in
any meaningful way and they are generally indicated with strikeouts. So,
with that general guide for reading the document let me turn this back
over to Abby, Cindy, and Kathy for moving forward.

MS. DILLEY: There are a variety of technical questions in terms of
navigating the documents that people have. Because now I don\'t want you
to look at the document for now. I think we need to take just a \-- we
have about a little over a half an hour until we have Dr. De Haven come
in and talk, provide updates, and provide an opportunity for the
committee to ask questions.

What I think would be helpful is to revisit how we\'ve been talking or
thinking about coexistence and taking the committee\'s work. Obviously,
one of the most important things to sort through is how to take up the
Secretary\'s request given to the committee and the committee\'s
interpretation of that request and then we have kind of a time frame.
All those factors have been working through how we\'ve approached our
work and then we\'ve had a couple from the paper that Nick took a crack
at, kind of summarize our deliberations and looking at it through the
lens of market issues. We also talked about fostering consumer and
grower\'s choice.

But, with that coexistence from a lot of different lenses. We also have
a fairly challenging time frame in terms of completing the project and I
think having just completed one report not too long ago that took three
and a half years to complete. I think we know to try to integrate
diverse opinions is always challenging. I think we just need to kind of
take a step back for half an hour and talk about what are we trying to
accomplish and how we\'re looking at coexistence issues.

The way we framed it and it has \-- again, we\'ve worked at it through
different lenses has been, and I think this came out of the discussions
particularly last session which was talking about the fact that
coexistence is occurring and has occurred in lots of different
situations in agriculture. We talked about the yellow corn/white corn
example and currently we\'re looking at it obviously with conventional,
genetically engineered, organic, and then trying to meet the charge the
way we shaped it in terms of an increasingly complex marketplace and not
just looking at what\'s happening now but looking towards the future and
how might the committee be able to highlight some issues in terms of
what is going on relative to coexistence, what is working, what is not
working, whether you want to frame it as market failures or pressure
points. We\'ve been using pinch points so we got a lot of feedback on
that and not wild about that terminology which has become a placeholder
I think for us not having landed on a particular concept of what we\'re
trying to and how we\'re trying to do it, whether you want to talk about
a market failure or interfering with choice at a grower/consumer level
or how are we trying to structure this.

It\'s getting our hands around that which we definitely need to do, but,
talking about what is working, not working in the current environment
and then anticipating challenges in the future and a lot of that\'s
built off of some of the presentations during the last session where we
had especially comments about the infrastructure and talks about the
impact that the Liberty Link is raising, a lot of people wondering why
we\'re talking so much about economics and especially people who hadn\'t
been at the last meeting. But, just using that as the conversation we
had at the last meeting and then sorting through any observations we
might be able to make in the future in terms of where those, let\'s not
call them pinch points, but pinch points, are they going to get worse or
better. Is it \-- define it as, are we reaching that point whether you
call it a market failure or failure to be able to choose what the
consumer role wants to do as a failure, so is there any intervention
required or is there anything that we want to talk about in terms of
encouraging or discouraging or addressing?

And I think that\'s where we started getting into more
recommendation-like language and yet we had talked about the fact that
the paper is really to develop observations, what kinds of observations
are we having. Do we really want to get to the point of recommendations
and I think actually when the Secretary first gave the topic to the
committee talked not about recommendations. That\'s not necessarily what
was being looked for and that\'s another question that I think we need
to put out there in terms of if there is recommendation-like language
and there\'s some concern about that where we want to go.

I think having worked on that opportunities and challenges and other
documents that the committee has produced getting the point of having
consensus around, not only painting a picture that incorporates
different points of view but going the next step and saying, therefore,
we\'d like to recommend this is challenging under any circumstances.
It\'s particularly challenging I think when you have right now is this
meeting and the next meeting to complete our task on this project.

So, I think we need to revisit the bidding to some degree in terms of
what\'s the scope we\'re taking on and what are we trying to accomplish
in a fairly short period of time given that I think we\'ve done a lot of
good work and provided a lot of good observations, even to this point,
that have reflected some of the documents and conversations that
haven\'t necessarily been reflected in this document because it was so
popular at the last meeting to kind to pull everything forward.

So I think I just want to have an opportunity to talk about what\'s the
scope of what we\'re trying to do. Does it still make sense in terms of
what we\'re trying to do? And then I think getting more grounded in that
discussion will help us then reflect on so how do we want to use this
document, where does it need to go, and how can we meet our objective
for completing our task on this particular topic.

So, what I will mention for the new committee members, we use our name
tags so you don\'t have to hold your arm up for a long stretch. Hold
your tags up so we scan it. So for those of you who are new to the
committee that helps me know. So, Carol.

MS. TUCKER FOREMAN: I may have missed it, but, as of today what\'s our
goal in terms of completing this paper time-wise, completing the paper?

MS. DILLEY: Timeline?

DR. SCHECHTMAN: The goal is to complete a paper by the end of the next
meeting.

MS. TUCKER FOREMAN: I\'d like to make a suggestion then. It seems to me
that the reason \-- as I went through this I was real troubled by the
fact that it doesn\'t really start off with this is what the Secretary
asked us for and, two, this is how we define coexistence. If we got that
down a lot of other things might come a little more easily.

Michael mentioned early on that he\'s really looking for a fairly short
paper and this one has gone beyond that. I think that if you had this is
what they asked for, this is the definition, this is what\'s working,
this is what\'s not, and these are the questions where we may have
trouble in the future and such we\'d have a paper of half dozen pages
and we could finish it.

MS. DILLEY: I see some nodding. That\'s good. Yeah, I mean, and that\'s
consistent, I think, with the way we framed it, but, first and foremost
you need to have that concise statement of what the Secretary asked for
in here, how we defined our work so that the rest that follows after it
builds off of that. And we defined it lots of different ways and we\'ve
talked about \-- I don\'t think it\'s necessarily inconsistent. We just
haven\'t pinned it down. And if we\'ve talked about choice for consumers
and growers. We\'ve talked about potential market failures. We\'ve
talked about it in a lot of different ways but we haven\'t really pinned
that down.

MS. TUCKER FOREMAN: The coexistence paper from the EU starts out with
two paragraphs that \--

MS. DILLEY: That\'s the one with agriculture and rural development at
the top.

MS. TUCKER FOREMAN: It starts off with a couple of paragraphs that are
real simple definitions of coexistence so that might at least give us a
jumping off point. I don\'t think there\'s anything in there that\'s
EU-centric.

MS. DILLEY: So, when you refer to that I think everybody has that.
That\'s coexistence for the ability of farmers to make a practical
choice between conventional, organic crop production. Talks about legal
obligations for labeling and purity. And then really again reiterates, I
guess, coexistence. At the bottom is coexistence encircling to economic
implications. Is that right?

Other thoughts? Yes.

MS. TUCKER FOREMAN: One last thing on that. The only weakness that I see
in this is that it really doesn\'t \-- it really is limited to
producers. It doesn\'t say anything about the ability of companies or
consumers to be able to get the product they want, but, I think the
emphasis there is the correct one.

MS. DILLEY: Other thoughts on it? So, there\'s a lot on the table in
terms of making sure \-- not going into what do we think about the
future so taking that piece of it out of the equation and more starting
with, first of all, what\'s the working definition of coexistence and
then how we were looking at it and then what\'s working, what\'s not
working, and then observations about future, where it may get to,
potentially tools that may assist in perpetuating coexistence or
potential particular problems that may need to be looked at, but, then
not making recommendations, not going into sort of anticipating other
future type of thing which is another exercise and that makes it a
little more difficult to reach agreement on how everyone\'s interpreting
the future.

MS. TUCKER FOREMAN: Avoiding conjecture is probably \--

MS. DILLEY: Yeah.

DR. SCHECHTMAN: We have a lot of conjecture.

MS. DILLEY: Who doesn\'t like the conjecture, but, especially given our
time frame I think it makes it that much more challenging to go down
that path.

So, other thoughts, comments about how we\'re getting ourselves
grounded?

MR. GRANT: Well, I think I would just like to support where Carol was
pointing us. My thoughts were really similar. You know, my comment right
at the beginning of the draft, that\'s really in that very same line of
thinking and it should be defined as narrowly as possible. I thought it
was very interesting to read Brian\'s document and he really used the
definitions to ground his document in the discussion and helpful to
responding to it.

I was kind of also very interested to read the EU document, the more
academic version, not the compilation, but, the academic report and see
how in their discussion this has really become a proxy for the entire
battle between the different factions and I don\'t think we want to go
there.

MS. DILLEY: Right. Leon.

MR. CORZINE: I\'m sorry for my tardiness. The airline industry didn\'t
want me to get here any sooner this morning. I wondered as I read
through this and I went back through it whether as far as in the
introduction if that\'s where we are \-- sorry if I missed something or
I don\'t intend to make us regress, but, you could go \-- but, the
suggestion was could we go down to about the one, two, middle of the
third paragraph starting with the U.S. is now the world\'s largest
producer of both genetically engineered and organic crops and start
there?

All the verbiage above that I\'m not sure is really necessary.

MS. DILLEY: Yeah. I mean, that may be where we end up starting. We\'re
kind of putting the document aside for a little bit and just trying to
get ourselves grounded. What are we trying to do and how are we trying
to do it and the scope of what we\'re trying to do. And Carol, I don\'t
know when you came in, Carol put on the table that it would be helpful
to trim back what we\'re trying to do and really focus on the choice
piece and the economic piece of it because that helps us keep our scope
to a particular set of issues and then not get into what the future may
look like but really kind of capture what\'s happening now, where
there\'s some challenges, where it\'s working and try and stay with that
kind of frame as opposed to \--

DR. SCHECHTMAN: I mean, I think I also heard a little bit about some
observations for the future, but, not \-- but certainly unless things
change enormously and we get a paper in no time, you know, moving away
from the idea of coming up with big recommendations for the future.

MS. DILLEY: Right. So, we intend to pick up the document with \-- if we
can get set on that then pick up the document and do what you\'re
suggesting which is let\'s go back and see where do we want to take this
document. Nick?

MR. KALAITZANDONAKES: I certainly would support what Carol said in terms
of being out of the report. I want to make a comment which is that the
discussion that we are having is in some ways like the discussion that
the European Union has been having and in some ways very different and
the reason I\'m saying this is because a lot of what is going on in
Europe is driven by their labeling requirements, their mandatory
labeling requirement and we don\'t have them.

And, so, my scope of the discussion on coexistence in Europe is wrapped
around thresholds, AP, adventitious presence, and labeling requirements
and we have none of those. So, it is important to separate what it is
that is common and so I just wanted to say that.

MS. DILLEY: Other thoughts or different points of view or concerns as to
where we\'re heading with this? Because I think if that seems reasonable
to people then I think we need to try and capture that, what is our
working definition and get that pinned down and then we can come back
and look at the document and say, okay, where do we need to move this
document in a framework that given our framework and our definition of
what we\'re trying to accomplish as a backdrop to really take a
different look at the document I think, one that can move it forward.

Any other thoughts, perspectives? Okay. So, well, the charge, and,
Michael, I don\'t know if this is appropriate to pick up the one that\'s
in the meeting objective, this is an increasingly complex marketplace,
what issues should USDA consider regarding coexistence among
increasingly diverse agricultural systems, obviously we\'ve been looking
at those. I think the Secretary\'s office is trying to get us to think
both current and future and the way we\'ve looked at it so far is really
more weighted on the current which would fit with us approaching the
topic and I think it is consistent with some of the commonalities of the
European Union discussion in terms of the economics, both choice piece
and the economics and looking at those dimensions of it.

I don\'t know if we have ever actually defined it, however, so, I don\'t
know if that\'s the best way to take a run at it or we can try to see if
we\'ve got dimensions of it and then maybe come back after we have the
USDA update and focus more specifically on that, but, I just want to
make sure if people have any other questions of where we need to go with
the conversation if you have other particular pieces of it if we need to
revisit that.

I don\'t want to spend time. In other words, I don\'t just want to spend
time just cracking the definition. I think we just want to make sure
we\'ve got the different elements of it I think we could probably do
that at the break and then move forward into the framing of the rest of
the scope of work. So, what\'s the question, Abby? The economics and
choice piece that needs to factor into the definition. Nancy?

MS. BRYSON: I just thought that the meeting for this time were very good
when I looked at them in terms of a couple of short clear statements
about coexistence. There\'s one on page 4. There\'s one on page 5. The
one on page 4 talks about concept of coexistence as fostering choice for
producers, customers, and consumers which I think matches up well with
Carol\'s language that she was pointing to in edit the other two
dimensions and then there\'s sort of a similar brief discussion on page
5. So, it\'s a break of looking at those I think it\'s pulling all of
this together.

MS. DILLEY: Stephanie?

MS. WHALEN: I agree with what Carol said to begin with as the three
items to look at.

MS. DILLEY: Can you speak up? I think we\'re having a hard time picking
you up on the mike.

MS. WHALEN: I said that I agree with what Carol had said at the
beginning on these three points the Secretary asked for something and we
needed to define it but we skipped to the definition and I\'m just
wondering what actually is the Secretary\'s charge. That would help me.

DR. SCHECHTMAN: That turns out to be a more complicated question. What
our initial charge was to the committee has been discussed and was
modified by the committee but the modification which is what is
described as the first bullet on the agenda is an acceptable charge to
the committee and that was in an increasingly complex marketplace \--
I\'m trying to remember from memory \-- what issues should USDA consider
regarding coexistence among increasingly diverse agricultural systems.

And that was the last version of the charge and that was okay as a
definition for what the committee should be working on and that could
very well make it somewhere within the first 20 pages of the paper or
so.

MS. TUCKER FOREMAN: Obviously we could start out by simply saying the
charge from the Secretary was and redefine coexistence as. Seven or
eight lines maybe.

MS. DILLEY: Okay. There\'s more history there, but, I don\'t know if it
adds anymore clarity though. Okay. It seems like people are pretty
amenable with it to scaling it back, being more precise in terms of
putting the charge in there, defining what it is, and the definition
using pieces that we\'ve already discussed in terms of the choice,
fostering choice of producers, customers, and consumers which I think
gets the marketplace piece of it as well as the face piece of it and
then try to capture what\'s working, what\'s not working and what the
potential additional challenges might be in the future.

So, if we are \-- I think the other piece of it is recognizing and when
we do look at the documents that we\'re not \-- we don\'t \-- we\'re not
really working for not recommendation language. I think that was another
piece of people having a lot of comments in the document that we must
make a recommendation and we need to scale back from that and that\'s
been through in other previous documents as well where we\'re really
trying to capture a picture of what\'s going on as opposed to going the
next step to recommendations.

Carol and then Mardi.

MS. TUCKER FOREMAN: Do we have the computer capacity today because I
think, you know, I\'ve been playing with that language, Nancy obviously
has been, and maybe during the break we could get something up there.

MS. DILLEY: For the definition?

MS. TUCKER FOREMAN: Yeah.

MS. DILLEY: That would be great.

MS. TUCKER FOREMAN: I\'ll buy Michael\'s suggestion that the bullet
describes whatever it is.

MS. DILLEY: Mardi?

DR. MELLON: On the recommendation question, I agree that we shouldn\'t
strive for recommendations and, you know, I did a lot of work trying to
excise them from, you know, they were kind of shot through the document.
But, if by any chance we actually could come to agreement on one or two
things that might be a good idea and I\'m not sure that that\'s
impossible. I wouldn\'t rule out a recommendation.

MS. DILLEY: I think that makes sense. I mean, I think the first order of
priority is trying to get a collective consensus opinion in describing
what is and how it\'s working or not working. If the committee can go
beyond on I think certainly the Secretary\'s not going to say no,
that\'s not helpful.

So, if we go in that direction, but, that should not be the ultimate
goal, I think, especially given that we only have until the next meeting
to complete this, which is a short time frame.

Other comments, questions? So, with that I think looking at that
organization of the topics I think we\'re in good shape. I would assume
that to me we\'ve got another ten minutes I would prefer we just take a
break now because I think otherwise we jump into the document and
that\'s only ten minutes and then we have to pull out of it. So, I
suggest we take a break now, come back at ten when Dr. De Haven is here.
Is that all right, Michael?

DR. SCHECHTMAN: Yes.

MS. DILLEY: If you don\'t have documents make sure you pick up
additional copies, especially since I found this typo. I don\'t know
about your computer but my computer doesn\'t print out all the comments
on the side so if you have text without those comments I think it would
be helpful to pick up a copy outside that provides that.

So, let\'s reconvene at ten o\'clock and we\'ll take a ten minute break.

DR. SCHECHTMAN: But, let me just say that Dr. De Haven is going to have
quite a tight schedule so we\'ll need to be back and ready to start
because I know he has another meeting at 10:30 so he\'ll be in at ten.

MS. DILLEY: Take a break and then come back.

(Whereupon, a brief recess was taken)

DR. SCHECHTMAN: We are starting late and I\'m happy right now to be able
to introduce to you Dr. Ron De Haven who is the Administrator of the
Animal and Plant Health Inspection Service and he\'s going to provide
some updates on the two relevant topical issues, one having to do with
transgenic rice and the other having to do with transgenic alfalfa and
answer a few questions.

Dr. De Haven.

DR. DE HAVEN: Michael, thank you and it is good to be here. It\'s an
interesting time in the biotech arena and I guess I don\'t need to tell
any of you that, but, before I get into the issues I want to thank you
for your volunteerism to be part of this advisory committee. There are
several such committees within the department, as you know, and we take
your ideas and recommendations very seriously, so, again, I appreciate
your being here and your volunteerism to be part of the process to make
our oversight of biotechnology better.

It\'s a common joke, but, not so much, actually within APHIS right now
with all of the attention that\'s being directed towards our
biotechnology regulatory services unit. I give Cindy a hard time about
the fact that BRS is the smallest unit, program unit within APHIS, but,
it is consuming all of the agency resources and some outside the agency
as we are dealing with a number of issues and events and I think an
indication of some growing pains because it is an area that is growing
significantly and importantly and one that has tremendous potential in
terms of meeting some societal needs, but, we\'re walking that tightrope
of not unduly restricting an industry, but, at the same time providing
adequate oversight and regulatory oversight of the industry.

So, it\'s that tightrope that we will continue to walk. I guess a lot of
the attention surfaced earlier when we had a report from our Office of
Inspector General who in large part talked to our folks found out about
a lot of the activities and ongoing improvement initiatives that we had
underway and, in fact, that\'s the reason my predecessor, Bobby Acord,
created BRS some years ago. It was recognizing the importance of
biotechnology and it was an area where we were going to need to be
focusing additional resources.

So, we obviously recognize the need. We had a lot of activities in place
to improve our overall regulatory process and ended up in an OIG report
that in large part took those initiatives we had underway and we found
those in the form of recommendations and findings of the OIG report so
in some respects that\'s helpful and in some respects not so much, but,
nevertheless, I think it adds to the importance of some of these changes
that we have in the works.

Most importantly in terms of changes in looks is our effort to publish
an Environmental Impact Statement that would then precede an overall
rulemaking change that would modify the way that we provide regulatory
oversight recognizing that not all of GM products are created equal,
some represent significantly more risk than others, and, so, that we
would through our regulatory approach recognize that difference, spend
less time focusing on those GMO\'s that represent little or no risk and
more time on those with uncertainty about the ones that represent a risk
such as pharmaceuticals and industrial.

So, that really is the idea behind our regulatory rulemaking that,
again, will follow the EIS which we hope to get out in the near future
and while we have a lot of high priority activities within APHIS and
more broadly within the department I can assure you that this rulemaking
initiative is one of the most high priorities. It\'s one of the many
number one priorities that we have to get done as quickly as we can. So,
we recognize the need to do it and do it right, but, we also recognize
that there\'s a little time sensitivity in terms of getting that out as
well so that is a high priority.

Michael mentioned a couple of lawsuits recently that had some negative
findings. Two of them in which the court ruled that APHIS had failed to
properly document that the deregulation or field testing of GE crops did
not present special circumstances which would require more analysis of
environmental impact process consistent with NEPA. The first was the
alfalfa lawsuit on February 13th of this year. The Federal District
Court in San Francisco in response to a lawsuit filed by the Center for
Food Safety and other non-profit organizations found that the department
had not adequately considered all the issues with regard to deregulation
of Monsanto\'s Roundup Ready alfalfa. The lawsuit alleged violations of
not only NEPA but also the Plant Protection Act as well as the
Endangered Species Act.

The court ruled that APHIS had not adequately assessed the potential
environmental impacts when deciding to deregulate this Roundup Ready
alfalfa, suggesting that APHIS should have provided data demonstrating
that organic farmers would be able to keep their operations separate
from any genes from this particular product and suggesting that because
gene flow can present an environmental impact and then that results in
an economic impact negating the department\'s argument that this was
more of an economic issue and not so much an environmental one.

So, on March 12th the court issued a preliminary injunction on growers
that had already planted this Roundup Ready alfalfa could continue to
harvest, sell, \-- harvest, use, and sell the crop and in planting could
continue until March 30th. No additional sales of this Roundup Ready
alfalfa could continue after March 12th which was the day the court
issued the preliminary injunction and then of course the court vacated
APHIS\' decision to deregulate this particular event.

While we\'re not so pleased with the court\'s decision I think it\'s not
all that bad either. It is helping us already to improve some of the
processes that we have in place and I think those issues would go more
to documenting the decision and the basis for the decisions we make
rather than undermining of the basis or the science on which those
decisions were made, so, again, we\'re taking that seriously in terms of
complying with the court\'s order. We notified the sellers and growers
of this Roundup Ready alfalfa, of the court\'s requirements to encourage
and gain full compliance with the court\'s order.

The second lawsuit had to do with bentgrass and involved APHIS\' review
of notification to field test herbicide resistant turf grasses. The
court ruled that although APHIS\' genetically engineered notification
permits are categorically excluded from the need to prepare a NEPA
document or notification in this case, suggested that this bentgrass
would have fit into that categorical exclusion, we did not adequately
document that none of the exceptions to that categorical exclusion
applied in this case.

So, we have here again taken the appropriate corrective actions in that
regard. The court did cause us to cease issuing notifications until we
had improved procedures in place to ensure that we, in fact, did
consider and document all of the relative environmental issues and, so,
we are now once again issuing notifications and catching up on a backlog
there which obviously is important to the industries that were so
affected.

And, again, I think processes that will make our overall regulatory
oversight better, but, also consistent with where we intend to go in
terms of our ruling. And then of course we have the rice situations
starting with the finding of Liberty Link 601 in a variety of rice
called Cheniere. This was a rice that we have subsequently deregulated
but of course this rice found its way into commercial channels probably
through deregulation.

It represents no risk from an environmental or food safety standpoint
and there was no intent for it to be commercialized at this point and,
in fact, it did find its way into commercial rice. It was then followed
with the more recent situation involving the variety of rice called
Clearfield 131 in which we had initially an unknown GE event in that
variety of rice which subsequently determined that it is Liberty Link
604, again, one that\'s not been deregulated but in this same family of
genetic traits that has been studied and reviewed extensively and so
here, again, we feel comfortable in saying that it represents no
environmental or food safety risk and I\'ve said so very recently in
some of our press announcements.

But, here again, these two situations suggest the need for the
regulatory reforms that we are undergoing, making sure that, one, we not
only carefully consider the basis for all of our decisions in ensuring
that we are making those decisions on good solid scientific basis and
categorically say that I feel that we have done so, but, I think where
we may have been missing the boat is in completely documenting some of
those decisions and documenting them in ways, in such a way that a lay
person, a District Court Judge, for example, could understand the
process that we went through and the scientific basis for the decisions
that we have made.

So, a learning process all around and, again, I think confirmation that
we are appropriately involved in developing an EIS and a ruling
initiative to improve our inter-agency regulatory oversight.

One other issue that is very much on our plate and that is consideration
of low level prevalence in GE products and I think for us a two-fold
process looking at what our current regulations would say and how we
would interpret that in terms of low level prevalence, but, also working
through that in an international union through Codex in clarifying the
international arena what low level prevalence means and how a country
should respond to that.

And, so, we are very happily involved in that whole process from an
international perspective as well. So, with that, let me pause and see
what questions and comments you have. We have both Cindy Smith, our
Deputy Administrator for Biotechnology Regulatory Services and Rebecca,
our Associate Deputy Administrator in the audience and they can help me
with the easy questions and I\'ll take the hard ones.

DR. CARDINEAU: I\'m curious as to whether or not the USDA has figured
out in conjunction, I assume, with the company, how the Liberty Link
rice got into the market.

DR. DE HAVEN: Thank you for the question. Did you all hear the question?
We have an ongoing active investigation to determine just that, how did
this rice find its way into commercial channels. I think there\'s been a
lot of misperceptions about what the purpose of our investigation is
and, you know, to the extent that an event has been deregulated from an
official standpoint at that point we don\'t really care what the
geographical distribution or the prevalence of that organism is, that
GMO is. Once we deregulate it, it\'s determined to be safe.

So, let me first start by saying what this investigation is not and that
is not an effort to determine how prevalent and what is the geographic
distribution of the 601 event. It focuses exactly on what you\'re asking
and that is, how did this happen and did it happen in such a way that
there were violations of our existing regulations that would allow the
event to find its way into commercial channels?

Every time we think we\'re about to wrap up an investigation and the
findings we come up with a new wrinkle, new test, and new event like the
Clearfield 131 and so that investigation is still ongoing and so at this
point it would be prudent for me to not say anything more than other
than that question you\'re asking is exactly the focal point of our
investigation to determine how this happened and were there violations
of our regulations that allowed it to happen and then taking appropriate
action based on the findings of that investigation.

There are obviously market sensitivities here, particularly in export
markets and a lot of pressure simply from our European colleagues why we
must resolve this investigation so that things can get back to normal
and so we\'re struggling between another tug of war of wanting to wrap
it up quickly but also making sure that we do a very thorough job so
we\'re doing it as quickly as we can do it well.

DR. CARDINEAU: Thank you.

MS. GEISERT: Alison and then Mardi.

DR. VAN EENENNAAM: Yes. Could you explain what happens next with the
alfalfa case? Does it go to court or when can people start planting it
again, or, what happens next?

DR. DE HAVEN: Well, the next step will be a hearing on March \-- what is
it, Cindy \--

MS. SMITH: April 27th.

DR. DE HAVEN: \-- to consider whether or not the preliminary injunction
would become a permanent injunction so that is the next step. Will the
court issue a permanent injunction on continued use of this particular
event? Presumably that would still allow us the opportunity to go
through a regulatory \-- continue to go through a regulatory process,
but, until such time as that hearing would happen and we could convince
the court that we have satisfactorily considered all of the relevant
issues it remains a regulated event.

Cindy, do you need to expand on that?

MS. SMITH: No.

DR. DE HAVEN: Okay.

DR. VAN EENENNAAM: Is that the person who makes the decision?

DR. DE HAVEN: It is. And indeed because we\'re represented through the
Department of Justice and there are a number of opportunities for the
Justice Department to consider appeals of a full range and so on, I\'m
beginning to talk like an attorney here, but, you know, perhaps appeal
to a full panel of that District Court or appeal to the Circuit Court so
I\'m sure that there are additional legal remedies that we might
consider, but, the next step would be this hearing on a permanent
injunction as opposed to a temporary injunction.

MS. DILLEY: Mardi and then Duane. Oh, Rebecca, did you want to say
something?

MS. BECH: We\'re going to be preparing an environmental impact statement
and so that\'s also included in the next step is it will remain a
regulated article until we complete the Environmental Impact Statement
and then make a decision on how to proceed in the deregulation process.

DR. DE HAVEN: Good point. In fact, that\'s part of what the judge
ordered us to do was to go with EIS on this and then based on the
results of that would consider deregulation.

MS. DILLEY: Mardi.

DR. MELLON: Well, since you haven\'t made a decision to appeal yet
you\'ve got a District Court ruling I think that the Department must
consider economic risk as part of environmental impact statements. I\'m
interested in whether you\'re going back and looking at other
documentation that you\'re preparing in conjunction with other crops and
trying to assess the economic risk. That would be one question and my
second question is just how many more rice contamination events do you
expect?

I mean, do you think this a flurry that\'s now over or do you think that
this is going to be an ongoing part of all of our lives?

DR. DE HAVEN: Well, for me to speculate on how many more of these
Liberty Link rice events we might have in the future would be pure
speculation and this is probably not the appropriate forum to speculate.
We didn\'t anticipate the Clearfield 131, for that to happen, and, so, I
would hope not, but, I don\'t know of any crystal ball that would allow
us to predict if there would be any more like this or how many.

DR. MELLON: Excuse me. It would come out. An ability to answer that
question might come out if your investigation is as to how this happened
in the first place.

DR. DE HAVEN: I think we\'ll be able to infer from that investigation
whether or not we are more than likely looking at \-- we\'ve seen the
universe in terms of these situations or it\'s a fact that could be
potential ones. Similarly, to defer to you on the first question in
terms of how are we going back I would only say that we are working hard
to comply with not only the letter but the intent of the judge\'s order.

DR. SCHECHTMAN: Could you move up towards the mike so it will get on
record.

MS. SMITH: To add a point onto this issue, something I can assure you
it\'s really hard for us to \-- what we\'re doing with the investigation
is we\'re taking a very hard look at exactly what we think can happen.
It takes a long time to gather evidence along those lines, but, that\'s
important information for us to act upon. One thing I will just reassure
you is that you can expect action from APHIS when these situations
happen.

You know, this was a case where we learned about this. We received a
little bit of information on a Wednesday evening. By Friday we had a
little bit more of a picture and we spent the weekend activating folks
across the country to prevent farmers from planting this crop because we
were under the impression that the majority of the crop was going to be
planted that coming week and as a result of being able to put the
systems in place that we have we were able to end up with what we
believe was three acres being planted and so I can assure you can expect
a lot of action from APHIS.

DR. DE HAVEN: Let me just interject here too, not only were we very
quickly to have acted very aggressively, we couldn\'t have asked for any
better cooperation from our industry partners in terms of getting that
rice on hold and making sure that we had recovered all of it and I think
it\'s a success that, in fact, only three acres were planted.

MS. SMITH: I\'ll speak to your second question about looking at economic
impacts where there may be a connection with environmental impacts
we\'re looking very closely at that now. Of course, that\'s a different
way of looking at things than we have historically so it\'s a rather
significant undertaking. I think what we\'re looking at right now is
whether the most pressing regulatory decisions on our plate and kind of
starting on a right-now-what-decisions-do-we-need-to make basis, looking
more carefully at these issues, going ahead and assuming that there\'s a
closer look we have to take for now pending the long-term outcome of
this case.

So, there is more analysis that we are looking at currently. We are
looking at multiple mechanisms to try to do that, both internal
expertise as well as contracting, so that\'s very much on our plate.

MS. DILLEY: Duane and then Sarah.

MR. GRANT: So, two questions. First of all, the easy one. What is the
timeline for the EIS on alfalfa, and then the second question would be,
so this was an effective re-regulation of something that APHIS had
deregulated? Does this set a precedent for potential re-regulation of
other crops that are over pollinated where some of these same issues may
apply?

DR. DE HAVEN: As to your first question, by the time when the EIS \--
I\'m not trying to sound trite, but, rather seriously as quickly as we
can get it out and we think that we are within weeks of getting EIS out.
And, again, this would be a draft for comment probably in preparation
for comment so as quickly as we can, but, again, as quickly as we can
get it out and do it as well as we can.

Your second question about does this set a precedent. Again, I think
that\'s a legal speculative question and one that I\'m not sure I\'m
qualified to answer. Cindy indicated that, you know, this is a different
way of looking and requiring us to look at things, not just from an
environmental standpoint but also an economic standpoint and the judge
making the connection to the fact that the economic impact could have
some environmental impact so requiring us to do that.

So, we will do so in the future. We\'re taking a retrospective look at
that as well. But, I would hesitate to speculate as to whether or not
this will set a precedent and we\'ll be looking at similar source of
challenges in the future I simply don\'t know. In the meantime, we\'re
going to be doing all that we can retrospectively to ensure that we\'ve
got all bases covered.

MS. DILLEY: Sarah?

MS. GEISERT: Thank you. Thank you for your help in the last couple of
weeks dealing with Mexico and I think again there were no environmental
or safety risks associated with the rice. Certainly they have found
market risks associated with it. And I\'m wondering as you look forward
and talk about looking retrospectively back if there are some
opportunities that we should be thinking about or doing differently to
address those marketplace challenges as these events come forward.
Mexico was the last market where we\'ve had issues of significance and
you stepped in to help out with those issues, but, we\'ve had a number
of lessons learned and I\'m wondering if there\'s a way we can begin to
build in some more proactive steps to deal with these events that occur
to help with the marketplace.

DR. DE HAVEN: You\'ve raised some excellent points and I think much of
the reaction that we have seen internationally has been based on
consumer fears that are founded on lack of knowledge, misunderstanding
about what GMO\'s are and what they are not. And, so, I think that there
is and will continue to be some public relations, public education
perspective here.

I see it as one of the functions of this advisory committee to take a
somewhat external science-based view of some of these court decisions in
knowing how we are functioning and make some recommendations to us in
how we can improve the process. So, I think it\'s timely that it\'s
unfortunate from a regulatory standpoint that some of these events have
been. It\'s timely, particularly as we are involved in this process of
getting the EIS out and going through rulemaking, making sure that we
have considered all of the relevant issues as we go through that
process.

So, again, I think that goes directly to part of the function of this
advisory committee is to take a look at those kinds of concerns. It has
been interesting from an international export market perspective as
we\'re responding to a lot of the concerns, even from the EU a desire to
mobilize trade and get past all of this turmoil that these events, these
situations have created, but, also taking advantage of them to provide
\-- taking advantage of the educational moment that these situations
provide in terms of educating the public in terms of what these GMO\'s
represent and what they don\'t in terms of food safety and environmental
risk.

DR. SCHECHTMAN: One last question and then I know Dr. De Haven has
another meeting.

MR. CORZINE: Thank you very much for being here and answering these
questions for us. As you look forward at the next EIS and particularly
if you\'re going to do one on every event that comes forward, do you
have an estimate on how much more time that\'s going to take or
resources to meet what you will need to meet that EIS? And the second
part of that is if you\'re going to include an economic impact side of
that, I mean that\'s a two-sided coin. I mean, does that mean if we\'re
going to be able to show a dramatic reduction in costs or something
along that line that that\'s going to have a weight as you do that as
well?

DR. DE HAVEN: Let me answer your questions at the 30,000 foot level and
then ask Cindy to get down to about 5,000 feet and I\'m not sure we\'re
ready to get climb up there yet. I don\'t necessarily agree that the
court decisions will require us to do an EIS in every case. I think what
it does require is for us to not only carefully consider whether an EIS
is done, is necessary or not, but, when we decide it\'s not to make sure
that we have very thoroughly documented and have a good solid scientific
basis for making that decision, again, not to suggest that we haven\'t
had a good scientific basis for what we\'ve done in the past, but, quite
honestly, we probably haven\'t been as complete as we could have been in
terms of documenting the basis for those decisions.

Having said all of that, I think this court decision will suggest that
we probably need to do more in terms of environmental impact assessment,
more EIS work, more situations where we\'ll do an EIS, and even when we
don\'t have to the additional documentation that we\'ll need to provide
based on the precedent set in this court case will slow things down.

So, I think it is realistic to assume that there will, in fact, be some
slowdown in the process, perhaps not nearly as much as there might be if
one assumes we had to do an EIS in every situation, but, we don\'t see
it that way. We see it more as more thoroughly documenting the decisions
that we make in configuring some of the economic consequences and the
process of doing so.

Cindy, do you have anything to add?

MS. SMITH: No, I think Ron made the point that on \-- I think our key
thing that we\'re going to have to do is better document our decisions.
One of the things that we\'ve done as we\'ve gone through the process of
evaluating the quality of our EIS documentation in general is we\'ve had
the opportunity to talk to our scientists about what were the questions,
you know, that we have identified a series of questions that they
answer. It\'s very interesting as we\'ve talked to them over the weeks
and weeks about how they\'re documenting the evaluations that they did
and what we found was, you know, well, for this question how did you
come to this conclusion.

Well, as scientists with years of training it was obvious to them. And,
so, we found what was happening was they\'re doing this analysis but
they\'re doing it in their head because they are scientists, they\'re
not documenters, and so the key thing I think we need to do on a number
of these is really pull out and make it transparent that we are asking
the right questions. We\'re doing a full analysis. And there may be so
many areas because this judge is looking at this question of economics
differently than we have, but, we will \-- there will be scenarios where
we don\'t have full information and we may have to undertake some work
to develop some of that larger body of information that we\'ll need.

I think I would agree with Ron also. You\'re talking about a process
that\'s going to take more time, but, I think in the end we\'ll all be
in a better place because of it.

DR. DE HAVEN: Thank you for the opportunity again. Thank you for being
part of this advisory committee. Because of the issues that we\'re
dealing with and the visibility all the more reason for this meeting and
some of the recommendations and guidance that we provide for as we move
forward in what I think is a very big critical time period in terms of
our regulatory oversights, setting a new foundation in terms of how we
will be operating in the future to provide an appropriate level of
oversight for GMO products. So, thank you very much for being here.

DR. SCHECHTMAN: Thank you. Thank you all. I think we will take a 15
minute break. We\'ll come back at 10:45.

(Whereupon, a brief recess was taken)

MS. DILLEY: In terms of noting of the minutes were comprehensive, part
of that is getting a good transcript and part of that is having a lot of
interfering noise for the transcriber to be able to take down notes and
if you do have a Blackberry and if you can turn it off so it doesn\'t
interfere with the signals it will pick up. Also, for those of you with
soft voices we\'re having trouble picking up your voice on the
microphone. So, if you could be sure and talk to the opposite corner of
where you\'re sitting that would be very helpful to pick up and have a
comprehensive transcript for the notes.

So, when we took a break we had been talking about pinning down the
language around the Secretary\'s charge and our working definition and
scope of what the committee was taking on in the paper and trying to be
succinct about that and building off of some of our conversations
previously and then looking at some of the ways coexistence has been
framed in not only our documents but also other documents to try and put
that together and pin that down so that can help shape what the rest of
the document is going to look like.

So, what we wanted to do is pick up on that conversation, look at
language on the Secretary\'s charge, and then also some language that we
had talked about before the break and some of our documents to see if we
could do exactly that and then try and \-- and then what I would imagine
starts working on the introductory language and kind of flesh that
buildup of the charge, introduction, and scope and we can start looking
at the documents, the compilation documents and the introductory
language in there and start working with that and seeing how we want the
buildup of our scope and working definition of coexistence.

So, one of the things that I noticed in looking at the summary was that
we actually had made some suggestions to the change in the goal of
language in the objective piece of it. I think we increasingly found we
were using increasingly too much. So, we had actually agreed to change
that language and I had not caught that in pinning that down in the
meeting objective.

And what we had talked about is incorporating the notion of "dynamics,
evolving" language as opposed to "increasingly" because it didn\'t make
a lot of sense. So, what we had put up there is, "In a dynamic evolving,
complex marketplace what issues should USDA consider regarding
coexistence among increasingly \-- that\'s where we\'re saving it \--
diverse agricultural systems", rather than having two "increasingly" and
now we have one and trying to capture this notion of just how dynamic
and changing the marketplace is.

MS. TUCKER FOREMAN: Take increasingly out of both places.

MS. DILLEY: Get rid of the "increasingly." I just don\'t like that word,
increasingly. It doesn\'t add anything at this point. Okay. Is dynamic
evolving okay and complex marketplace, does that get more to where we
are in that we don\'t need to spend the time on that language but I just
want to make sure we capture that notion of it as an evolving
marketplace. Carol, did you have \--

DR. BUSS: It might be much easier to read if you put the first part at
the end and have it read, "What issues should USDA consider regarding
coexistence among diverse agricultural systems supporting the complex
marketplace?"

MS. DILLEY: Okay. How about tightening it up a little better in terms of
what the committee was asked to do? Can we move off that one then and
look at our working definition of coexistence?

DR. SCHECHTMAN: You want a very short report.

MS. DILLEY: The Secretary asked and this is what we heard. Thank you
very much. Okay. A couple of people made reference in their comments as
well as earlier this morning about the documents, agricultural and rural
development and picking up the language that Nancy referred to in
previous documents and I think including this one perhaps, the
compilation document, but, trying to take a run at some language.
Coexistence refers to the ability of farmers to make a practical choice
between \-- this, again, merges a lot of different language, including
this one from the EU \-- to make a practical choice between
conventional, organic, and biotech crop production and \-- this is our
piece I think that we\'ve added in our conversation \-- for food
processors and consumers to have choice in the marketplace.

And then potentially that the notion of choice is how we\'re looking at
coexistence and then focusing on perhaps the economic dimensions more
specifically. Duane?

MR. GRANT: I\'m okay with that definition until you get down to the
bottom and it says for individual consumers to have a choice in the
marketplace. And I\'m not opposed to that concept, but, here\'s what
I\'m getting at if I can explain what I\'m thinking. Coexistence works
and we had a discussion about coexistence as long as you limit it to
kind of a single group or unit or group of affected parties. But, here
we\'re mixing in different drivers. The drivers for producers are
completely different than the drivers for consumers and if you require
that individual consumers have a choice in the marketplace then you\'re
saying that every \-- you have to offer, you\'re required to offer
different choices in the marketplace and there are some crops in which a
farmer making a practical choice may not ever offer an organic perhaps
offering in the marketplace.

He may not ever offer a GE choice in the marketplace. It\'s the
practical implications of it is if it doesn\'t work in practice, you
won\'t do it. So, if individual consumers have to have a choice, that
implies a different coexistence discussion than if producers are making
practical choices in response to \--

MS. GEISERT: Just so I understand. Because I think individual consumers,
I think that was trying to distinguish from other kinds of consumers, so
commercial consumers is the way I kind of read that. I don\'t know if it
needs to be consumers, but, the fact that they have a choice as a
qualifier for growers may be the qualifier for all this.

MR. GRANT: The last thing I\'d say on this is that you\'ll notice even
the EU\'s definition of coexistence didn\'t bring the consumer choice
directly in. Okay. Now, when the EU actually got into discussion about
what coexistence means absolutely consumer choice came into the question
and I think you can tell by their document that\'s one of the reasons
they haven\'t been able to resolve the issue.

MS. DILLEY: Carol and then Mardi.

MS. TUCKER FOREMAN: I think that maybe we should have put after the
Secretary's charge and gone home. I think that ultimately everything is
driven by people having a choice in the marketplace that they want.
You\'re not going to get to grow something if people won\'t buy it and
this doesn\'t have to suggest any requirement on farmers. It\'s a
reality that you want to have a choice in the marketplace. Practical \--
you may be able to rewrite it so that practical applies in both places
and I wouldn\'t object to that, but, I\'m not willing to have the
discussion limited only to farmers.

MS. DILLEY: Mardi?

DR. MELLON: I would point out that the definition, the way it\'s written
simply says it refers to the ability of farmers and consumers to have
choice in the marketplace. It doesn\'t say coexistence. It doesn\'t say
what an adequate coexistence is. It doesn\'t say that in order for
coexistence to be deemed adequate every consumer must have every choice
in the marketplace, every farmer must have every choice in the
marketplace. It just sets the stage in which we\'re working and it seems
to me that that stage does include choices that are made both by
consumers and by farmers with reference to, you know, kind of one
another.

So, I\'m comfortable with it just saying what it refers to and, you
know, perhaps going forward in terms of how much coexistence we want,
need, or, should guarantee had that come out of other parts of the
document.

MS. DILLEY: Yeah, I do think it\'s more fostering choices as opposed to
mandating choice. I mean, that notion of practical that\'s in there and
I think this kind of hearkens back to our discussions of market failure,
and market failure versus not a market failure, and it\'s kind of
balance out the notion of different choices, a variety of choices, and
also the fostering and not mandating choices.

So, it may be that we just don\'t have the right language, but, the
notion of choice among consumers and the whole food chain and food
production chain is part of the mix. I think it was Nick and then Randy,
Adrian and then Stephanie.

MR. KALAITZANDONAKES: As far as I\'m concerned what we have on the
screen is the truth. As far as I know, we do not have a planned economy
today and therefore consumers, farmers, and processors all have the
ability to make choices. So, I\'m not sure what the definition of this
is. And the reason I\'m saying this is because today they have the
ability to make choices. They will have the ability to make choices
tomorrow, right. So, coexistence isn\'t about the ability to make
choices. The reason that the document in the EU is written this way in
such a practical ability is because it refers to meeting specific
effects which are imposed through the regulatory process in Europe on
labeling and adventitious presence requirements and threshold.

In the absence of meeting a particular set of constraints this
definition doesn\'t work. So, to say that coexistence is about the
ability of farmers, processors, and consumers to make decisions, of
course we all do have the ability today.

MS. DILLEY: Randy.

MR. GIROUX: I\'m uncomfortable with that definition because it almost
sets up a conflict at the very beginning and I agree with Carol that the
markets work because people demand things and then other people produce
them to meet those demands and so in my mind it really isn\'t
independent choices between farmers and consumers in this particular so
I\'m uncomfortable with the way it\'s worded because it tends to set up
what looks like conflict where there isn\'t a conflict and coexistence
is more about how do supply chains work and personally I think there\'s
at least one sector missing from that definition.

MS. DILLEY: Adrian and then Stephanie.

DR. POLANSKY: I\'m not sure that it necessarily sets up a conflict. If I
was practical, it\'s there, but, it may be able to be said better. I
guess my thought is that hopefully that individual wouldn\'t necessarily
cause a problem for me in terms of processors and consumers have the
choice rather than individual or, you know, individual processor or
individual consumers. Consumers, it would seem to me, would be adequate
to address that particular part of the statement. Just a thought.

MS. DILLEY: Okay. Stephanie.

MS. WHALEN: I think I\'d have to agree with Duane that I don\'t believe
food processors and individual consumers needs to be a part of this. At
least coming from what appeared in Hawaii in terms of discussion of this
it really was the farmers wanted to be sure that they could meet demands
with whatever process they choose and, so, and sometimes I\'ve heard
farmers talk about the fact that they\'re not ignorant and they
understand how to render business and it is based on the need of the
final user and so coexistence for them was really about being able to
use whatever process they felt was needed to meet the demand in their
particular situation and, so, the demand is from those others.

But, that\'s not what we\'re talking about. We\'re talking about how the
farmers coexist in producing for the users or consumers or whatever you
want to call it. So, it\'s not necessary. It\'s already implied in
trying to make a business work and be possible.

MS. DILLEY: I think part of maybe the challenge here is because we\'ve
been talking about the choices and I feel like we\'re mixing half the
definition in terms of what does that mean in terms of what we\'re
trying to concentrate on and that\'s the economic portion or what the
scope is that everyone wants to take on and I don\'t know if we need to
add that to it in thinking about how to frame this in getting the right
language.

Nick, you\'re right in terms of that\'s what\'s explained in terms of
the EU with its particular obligations and actually I left out a few
sentences in terms of adding language to talk about within contractual
obligations so I don\'t know if that makes it less truism or is it more
definition or not, but, that\'s something to think about.

Carol, your card went up and then Leon.

MS. TUCKER FOREMAN: Yeah, I understand that mindset for many is that
this is only about farmers, but, production and consumption of food is
about farmers and I think that it is essential that you acknowledge that
there are at least three actors in this process and state it up front.

MS. DILLEY: Leon?

MR. CORZINE: I don\'t completely disagree with that, Carol, and I think
we\'re struggling with how to word that at the end of \-- I wonder, does
it work? If you look at that and you stop at the end of "and GE crop
production" and add \-- and strike everything after that and insert to
provide for the marketplace. I don\'t know if that weakens it for you
too much, Carol.

MS. TUCKER FOREMAN: It does. It really does. You want a recognition
there that there are other actors that are involved.

MR. CORZINE: Well, the marketplace is all the other actors.

MS. TUCKER FOREMAN: But you got to name them. My continuing effort is to
try to get people to take a broader view because in reality that\'s what
you\'re going to have to do. It\'s not just about farmers and I want a
specific recognition of the other actors in the marketplace.

Incidentally, in the content that we have it\'s there. We\'re just
trying to get it put in the first paragraph.

MS. DILLEY: We\'re talking about economic implications that are tools
that help foster coexistence at multiple levels, not just at the grower
level so it\'s kind of stand out without having to name every single
entity so it\'s somewhere between marketplace and what we\'ve got up
here and I don\'t know exactly the language.

MR. CORZINE: Well if I could respond to that.

MS. DILLEY: Sure.

MR. CORZINE: And maybe we\'re hung up on the word, and, Carol, you want
to make sure you get the word consumers in there, but, the marketplace
to me is the consumer at the end of the day. Now, maybe if we need to
reword that to make that better that was my attempt to do because when I
look at the marketplace that\'s the consumer and I don\'t think that
anybody here really believes that, you know, I\'m going to produce
things and not have a marketplace or not be concerned about the
consumer. I mean, because that is what we\'re doing at the end of the
day and we will continue to do but it\'s the marketplace.

MS. TUCKER FOREMAN: If you could take out individual. Processors and
consumers should not have to be in the definition as far as I\'m
concerned because marketplace is not enough.

MS. DILLEY: Let me get Guy, Nick, and then Mardi.

DR. CARDINEAU: In line with what Leon suggested and in light of Carol\'s
position when I was looking at the definition it occurred to me that
I\'d like to see the definition report status. After crop protection, I
think Leon is correct from my reading of the coexistence literature that
we\'ve seen or that has been shared with committee. Coexistence seems to
really focused on the producers, but, there\'s no question that Carol\'s
correct, that the downstream users are going to be impacted by that.

Could I suggest that we say after GE crop protection which provides for
food processors and individual consumers to have a choice in the
marketplace because the producers are going to make a choice on what
they\'re going to produce and then the consumers will be able to look at
those choices and decide what it is they\'re going to support. So, I
think that coexistence choice is made by the producer but it provides
the end users an opportunity to make the choice so we could just say
provides for food processors and leave individual in there from my
perspective. An individual consumer is to have a choice in the
marketplace.

Would that work for you, Carol?

MS. TUCKER FOREMAN: Thank you. I appreciate where you\'re going. I might
argue that it operates the other way around, that it is their desire for
choice in the marketplace that drives the farmers and I think that\'s
what Leon was saying that if you have an overwhelming number of people
who won\'t eat or use organic as a matter of principle yeah, you\'re
going to have people out there organic let alone charging a premium for
it. So, I appreciate where you\'re going. I\'m not sure that the
economists and the market people would agree that that\'s what\'s really
happening here.

MS. DILLEY: Michael is trying to come up with some language so, Michael,
I\'ll let you work that up and then I\'ll go to Leon and Randy.

DR. SCHECHTMAN: Yeah, I think this is building on in part what Stephanie
said earlier trying to hear a few of the comments around and maybe this
addresses a number of other things. What I tried was, coexistence is a
process of enabling farmers to meet demands of their intended customers
and consumers within their production system. I\'ll read it a second
time slowly.

A process of enabling farmers to meet the demands of their intended
customers and consumers within their production system.

MS. DILLEY: Within their production system. So just put another run at
it up there. Nick, then Mardi, then Randy.

MR. KALAITZANDONAKES: It seems we are in the process of offering
alternatives and a third one and I\'m going to go back to a sentence
that I used in my original report because I actually lifted it off a
European Union document and it\'s the best definition I\'ve seen over
the years so here\'s what it says.

"Coexistence refers to the concurrent cultivation of conventional,
organic, and biotech crops consistent with underlying consumer
preference and choice." It doesn\'t say anything about fostering choice,
it doesn\'t say anything about processes by which the choice is made. It
basically says what it is and, so, I read it one more time if you want
me to.

Coexistence refers to the underlying \-- I\'m sorry \-- to the
concurrennt cultivation of conventional, organic, and biotech crops
consistent with underlying consumer preferences and choices.

DR. SCHECHTMAN: With underlying consumer preferences and choices?

MR. KALAITZANDONAKES: With underlying consumer preferences and choices.

MS. DILLEY: Mardi and then Randy.

DR. MELLON: I could live with all the definitions as long as they do
include the major actors in the marketplace, but, I just want to point
out I kind of had to revise my opinion since my last comment, but, I
think at some point we need to say coexistence is desired in the
American marketplace. I mean, we talked about the first two. This whole
discussion doesn\'t make any sense if we don\'t take some sort of stand
on whether this is something that is either desirable, not desirable, or
on which we have no opinion. And I mean I think coexistence is something
that we ought to advocate as a good end for U.S. agriculture. And I
think that\'s been conducive with some of our previous conversations in
terms of where it\'s working, where\'s it not working, and what might be
considered to help foster coexistence.

It\'s just the way we\'ve been talking about it in the past so the point
is well taken and that it hasn\'t been part of the definition so far.
It\'s always that try not to cram everything into the definition versus
pursing it out a little bit in the introduction. Randy.

MR. GIROUX: I\'m not sure which definition I\'m commenting on.

MS. DILLEY: Go ahead.

MR. GIROUX: But, I just have a general that my guts tell me that we\'re
talking about coexistence of U.S. agriculture, right, and why do we do
pull out some\-- specific parts markets for U.S. agriculture there, a
few markets there, there are a few markets there, export markets there,
domestic markets, and so I just want to make sure that when we develop a
definition around coexistence we\'re not picking specific sectors or
others and, secondly, is it all coexistence of conventional, organic, or
biotech or are we talking \-- there\'s many types of coexistence.
There\'s lots of lessons can be learned about current coexistence. So,
do we want to nail the definition so much as to only include those three
types of coexistence?

And that\'s a question for the committee, but, the second is I think we
need to be looking at U.S. agriculture and there\'s many, many markets
for that and I want to make sure that we\'re covering all those that
we\'re talking about coexistence.

MS. DILLEY: That\'s a good question because we kind of keep going back
and forth between that was the language about the increasingly complex
marketplace, a complex marketplace, and other production systems in the
future, other than those, so, where are we on that is the question that
we need to address.

Russ and then Carol.

MR. KREMER: I kind of like this last definition on account of it, I
think the first one is, I believe in inclusivity and including all the
players and I think that that first one we were excluding people here in
the value chain including, for instance, processors for instance. A lot
of the food that we deal with isn\'t even processed. I mean, it\'s local
food that\'s distributed and brokered by somebody so we left those
players out. So, I think although this is more general I think it\'s
more inclusive. I can live with it but I think a little bit better than
the first one.

I also agree with Mardi. Similar in this document we need to make the
statement that we\'re trying to preserve and enhance our ability to
coexist and I hope that\'s taken into some consideration later.

MS. DILLEY: Okay. So, you\'re talking about some clauses in here that
get to some of those issues that hopefully will try to get to some of
those issues and hopefully you can see the screen. Carol, Duane, and
then Nick.

MS. TUCKER FOREMAN: I like this definition too. I like it just in terms
of being clear and if it said to underlying consumer preferences and
choices only because I think that\'s what\'s consistent with means, but,
it\'s shorter words.

And, Randy, I think that\'s general enough to meet everything. My goal
was to exclude from the definition the need to reference regulatory
requirements because they\'re clearly not what we\'re doing here and I
thought that, in fact, none of these were general enough that if you\'re
going to meet an underlying market and that market\'s the EU and
they\'re going to have to label it you\'re going to grow in a particular
fashion and you\'re going to buy in a particular fashion.

So, looking at that I think it meets your concerns and it was surely my
intention to have a definition that did not get us into the quagmire of
suggesting that where we go needs to be driven by the legal requirements
that are imposed in the European Union.

MS. DILLEY: Was that a particular question to Randy in terms of this
language around \--

MS. TUCKER FOREMAN: I asked the question, is this broad enough to talk
about all of the \-- I don\'t know any other kinds of agriculture so I
couldn\'t put any more in there.

MS. DILLEY: Daryl and then Nick.

MR. GRANT: I\'m actually very comfortable with this definition and I
remember, Nick, when you had in your concept paper. Who is CEC by the
way? I had a note that that\'s where you pulled it from.

MR. KALAITZANDONAKES: No, the European.

MR. GRANT: But, anyway, I can live with this definition. I honestly like
it and the reason I like it is because it refers back to the fact that
the coexistence practices are going to be at the farm level. Yes, they
will be meeting consumer preferences and I\'m fine with that. But, the
practices that we\'re talking about are at the farm level and that\'s
really where we\'ve got to focus if we hope to finish this thing.

MS. DILLEY: Nick and then Stephanie.

MR. KALAITZANDONAKES: So, I would prefer that we maintain the definition
and then we make a separate statement in a separate paragraph that says
we desire to maintain coexistence in U.S. agriculture. Because trying to
merge those two just, for me, doesn\'t work. So, let\'s define what it
is and let\'s say that we want to maintain it afterwards.

MS. DILLEY: Okay. Stephanie and then Leon.

MS. WHALEN: I was just making a suggestion based on a concern where we
have of conventional, organic, and biotech crops, just go back to our
original charge and put in diverse agricultural systems. It doesn\'t
make any difference we come up with new systems or some other system out
there besides those three. It\'s used in a diverse agricultural system.

MS. DILLEY: So as an add-on or is that before?

MS. WHALEN: No, replacing.

MS. TUCKER FOREMAN: Oh, replacing conventional?

MS. WHALEN: Organic and biotech.

DR. MELLON: I don\'t agree with that at all. We have a hard enough time
just addressing those three. The notion that we ought to be considering
something else is just buys us a whole lot of \--

MS. TUCKER FOREMAN: Okay. I was going to suggest if you move that phrase
after conventional, organic, biotech and biotech in diverse
agricultural.

MR. CORZINE: My suggestion is where underlying consumer preferences are
you speaking we don\'t need "and choices" because preferences are
choices. So, with that thought, if we cross that off in the idea that it
was suggested by somebody we\'re talking consumers but this always goes
right to food products then maybe we need something about the
marketplace so I was going to strike \-- I was going to change that last
to say "underlying consumer and market preferences." You like that or
no? You don\'t?

MS. DILLEY: Nick and then Mardi.

MR. KALAITZANDONAKES: So, the reason that preferences and choices is
because you can have preferences but not exercise them so choices is in
my view is an important sentence so as far as incorporating diverse
agricultural systems we can put it in the second paragraph that again we
are talking about desire to maintain so I\'m still in the same place
where let\'s define it in a very tight way and then talk about what it
is that we want to maintain.

MS. DILLEY: So the desire, etc. and the other diverse agricultural
systems would be in that second sentence after this first one defining
what it is. Mardi and then Adrian.

DR. MELLON: I do want to just to reiterate we need to talk about
organic, conventional, and biotech. Those are the issues that we\'re
focusing on and that would take the very little time that we have and I
think that these are actually very special issues. I mean, organic would
not be in the mix but for the fact that it is a surrogate in a lot of
folks\' minds for non-GE food because it has requirements in terms of
genetic engineering.

Those are the kind of issues we\'re going to have to look at here are
not going to come up with, I don\'t think in other as unnamed sort of
sectors of agriculture so if we could just, you know, keep focus on this
one and be clear about what we\'re talking about I think we can get
ourselves \-- we can accomplish this task in the time we have ahead of
us.

MS. DILLEY: Adrian.

DR. POLANSKY: I was just going to comment a bit on the last couple of
thoughts and current that it makes sense to leave the three listed. I
also think in a followup that mentioning the diverse agricultural
systems or something like that may make some sense in terms of just
giving a little bit of an indication of the future because I think there
will be more than just those three options at some time in the future
when there are health and safety improvements in terms of the foods
and/or crops.

For example, I believe there will be an organically produced GE crop but
we don\'t want to go there now because I think that adds a lot of
complexity and so I\'m okay with trying to deal with both of them and
the way that we\'re looking at it here.

MS. DILLEY: So what I hear so far is that people really want to stay
focused on coexistence. We really haven\'t talked about any U.S.
agriculture or for the purposes of the paper or for this committee or
whatever and we need to come back to that, but, coexistence refers to
the concurrent cultivation of conventional, organic, and biotech crops
to meet or consistent with underlying consumer preferences and choices.
That second sentence would then deal with something along the lines of
diverse agricultural systems and desires for proffering or something
along those lines to kind of extend beyond that to talk about what the
committee wanted to talk about.

So, we\'re stripping it down, the first sentence, to the basic
definition I think that Nick put out and then these other things that we
want to try and capture are in our subsequent sentences past that. Does
that make sense?

MR. KALAITZANDONAKES: Yes. In the second paragraph, yes, absolutely.

MS. DILLEY: Because coexistence, we\'re not defining it for U.S.
agriculture, but, we\'re defining it at least for the paper and for the
committee that\'s what we\'re talking about when we talk about
coexistence in this paper. There are other pieces of it that are in the
parentheticals, are in U.S. agriculture. Coexistence for the purpose of
the paper for the AC21 or however you want to \-- yeah.

And then the desire, I\'ll take it out because proffering a desire needs
to go in the next sentence and then the diverse marketplace needs to
also \-- diverse ag system and then U.S. agriculture needs to go in.

MR. KALAITZANDONAKES: I\'d prefer consistent with mostly because it
means something different \--

DR. SCHECHTMAN: Nick, could you speak up.

MR. KALAITZANDONAKES: I\'m sorry. I said in my view instead of the line
consistent with \--

MS. DILLEY: Why doesn\'t that work for you? I don\'t understand
consistent with. I mean I understand it but I don\'t understand the \--

MR. KALAITZANDONAKES: Well, what it says is the consumer preference and
choices in production and that then includes the whole supply chain
implicitly.

MS. DILLEY: Consistent with extended to the whole supply chain?

MR. KALAITZANDONAKES: Exactly.

MR. SLOCUM: Consistent with first practical choice. This way implies
that there\'s going to be practical choices.

MS. DILLEY: I see. So, that\'s a different angle then what you meant,
Nick, but, that flushes out the consistent with.

MS. TUCKER FOREMAN: I think that\'s part of your economist theme to have
it. I don\'t object. You know, I\'m just always looking for plain folks
words and \--

MS. DILLEY: Okay. If that works for people then okay.

MS. TUCKER FOREMAN: You know, biotechnology or genetically engineered,
we tried to use. Do we really want the word biotech there? Do you need
to put \--

MS. DILLEY: I think it needs to be GE. I don\'t think it needs to be
genetically engineered. It would be good to be consistent with our other
documents. Randy, anything else?

Rather than just kind of procrastinate we can do that at the lunch break
and come back with a second sentence. What I want to do is pin down the
other pieces of the framework that we had been talking about before we
had Dr. De Haven come in, but, I just want to make sure in terms of the
elements of that second and third sentence include we\'re looking at the
U.S. marketplace. We\'re looking at diverse agricultural systems so
while we\'re mentioning conventional and organic and genetically
engineered we\'re also talking about it had some rather than for some
other production systems to catch phrase but we\'re not going to \--
this paper is not going to deal with that, but, we just want to make a
nod to that.

And then the notion of fostering. So, those are the three elements that
we pulled out of the first sentences for the purposes of being concise
with our definition. Is there anything else or element that we needed to
make sure we don\'t lose in the first part.

Randy?

MR. GIROUX: I just want to make sure that generally this committee\'s
used the term consumer to represent the end use consumer.

MS. DILLEY: Yeah.

MR. GIROUX: And I think in this case we\'re going to use the term
consumer. We want to make sure that we\'re clear that consumer \-- this
does not go to just the end use consumers, the bag products, but all the
other sectors as well.

MS. DILLEY: Consistent with.

MR. GIROUX: Maybe it\'s best, I don\'t know. But, consumers has to be
there. All I\'m just saying is that U.S. agriculture is more than just
end use consumers.

MS. DILLEY: So you\'re saying it\'s the right terminology or the right
\--

MR. KALAITZANDONAKES: Why don\'t we say food sector.

MR. GIROUX: In the second sentence somehow define what consumer means.

MS. DILLEY: Yeah, okay.

MR. GIROUX: It\'s more than end use consumer. That would be fine.

MS. TUCKER FOREMAN: Would it help if you had customers and consumers in
that first sentence? That\'s what we\'ve used before to kind of
differentiate between the food chain to feed people and individual
consumers.

MS. DILLEY: Customer and consumer preferences and choices. Okay. Guy?

DR. CARDINEAU: Well, this is my first meeting and I don\'t really know
what you\'ve been using. I have a question about genetically engineered.
I like biotechnology better for probably obvious reasons, but, I\'m
wondering whether or not genetically modified might not be better
because one of the things that conventional and organic leaves out but
really isn\'t covered by genetic engineering is if you have mutation
breeding so if you look at all the wheat that\'s used for pasta it\'s
all been mutation bred. So, that\'s not really genetic engineering
because you\'ve not physically manipulated the DNA, but, you have
treated the material with radiation or EMS or some mutagen to change it.

So, I think genetically modified incorporates mutation breeding as well
as genetic engineering.

MR. KALAITZANDONAKES: Yeah, we don\'t want to do that.

DR. CARDINEAU: You don\'t want to do that. I like biotechnology crop for
survey reasons.

DR. SCHECHTMAN: Let me talk just a little bit about that. We have one
issue with \-- the U.S. Government has had an issue with the use of the
term genetically modified because we believe that it\'s an imprecise
term. In terms of the issues that wrap around coexistence and make it
difficult it\'s not that there\'s \-- that there are sectors that are
concerned regarding coexistence of products that are produced using
mutagenesis.

So, the issue that the committee has been talking around are the
concerns that derive and the ability for the different kinds of
agriculture that specifically relate to genetically engineered. So,
that\'s, I think, why that term is used, why we would use that term. In
one of the earlier papers we had \-- it was rather lengthy and I think
it went a fairly short discussion on the choice of terms.

We can certainly go back and pluck that old discussion and stick it in a
footnote in this one.

MS. TUCKER FOREMAN: That would be fine.

MS. DILLEY: That probably would be helpful too. I mean, just for your
reference. There\'s a lot of \--

DR. CARDINEAU: I don\'t want to re-plow old ground.

MS. TUCKER FOREMAN: I think it would be useful to put the footnote in.

MS. DILLEY: Yeah. So, it is in one of the documents out there. We\'ll
track it down and that needs to be edited as well. Are there other
pieces that need to be without taking the framework into the
introduction because we\'ve obviously talked a little bit about the
introduction hopefully spills off of these definitions and what the
paper is going to address.

Nick.

MR. KALAITZANDONAKES: What if we change the original sentence into
coexistence for the purposes of this paper refers to the concurrent
cultivation and procurement of conventional, organic, and genetic
engineered crops consistent with underlying consumer preferences and
choices so that we incorporate a lot of people\'s interest in explicitly
incorporating supply chain. Does that make it?

But, to make this point I think coexistence is a supply chain usually.
It isn\'t just agricultural issues. So, by putting procurement I
basically incorporate supply chain in my mind, but, \--

MS. DILLEY: So, from your perspective that\'s a better way to do it than
adding customer?

MR. KALAITZANDONAKES: Right. Because customers \-- I mean, consumers are
customers and processors don\'t make their own choices. You know, they
basically try to give what consumers ordiinarily will buy. So, you
needn\'t put customer in that part of the sentence, although I mean I
can live with it. I\'m just asking whether it\'s a better choice for
words.

MS. GEISERT: I don\'t know if you look at the issue we took into the
framing it is much more about the whole supply chain and I\'m sure about
procurement or customer, but, I do think having a little bit of
expandability for the group to say it\'s not just about the cultivation
of it and I think you can get there in the second sentence, you know, as
Randy talked about it, but, I think that\'s part of the issues that
we\'re going to talk about what\'s working and what\'s not working
further downstream so I guess I\'d be voting for, you know, one or the
other but I don\'t know that procurement is acceptable.

MR. KALAITZANDONAKES: The second sentence, in the second sentence?

MS. GEISERT: In the second sentence. I like the shortness of the first
sentence definitely.

MR. KALAITZANDONAKES: Maybe just take both out and just put them into
\--

MS. GEISERT: Yeah.

MS. DILLEY: Okay. So stick with consumer.

MS. TUCKER FOREMAN: I\'ll tell you, I\'d like procurement and take
customer out because I think procurement \-- I agree, that\'s really
basic. It\'s not just the cultivation. Is the market going to provide an
opportunity to get hold of what you need in order to meet your market
demand.

MR. KALAITZANDONAKES: Maybe we can say in a simple sentence something
along the lines of coexistence refers to the whole supply chain or
something like that.

MS. DILLEY: You\'d be very correct about that.

MR. KALAITZANDONAKES: Well, it is.

MS. DILLEY: Refer to whole supply chain. Okay.

MR. KALAITZANDONAKES: Yeah, or something like that, I don\'t know the
right sentences.

MS. DILLEY: Sounds like we\'re getting there making sure that we
establish it to the whole supply chain and that\'s okay to expand upon
in the second sentence. Okay. All right.

Are there any other elements that we\'re missing that just in terms of
first defining what we\'re trying to do and how we\'re referring to
coexistence. Okay. Then the third part is really what the paper covered
and I think in a conversation earlier this morning pulled it back a
little bit from where we had started going between the last meeting and
this meeting which was we had \-- the way we had outlined it was to talk
about the fact that coexistence is happening, was happening, and then
there\'s some areas where it\'s working and not working and some notion
of where it may become more challenging and we\'re talking about this
notion of fostering so it\'s getting to that.

So, what do we really mean by the sense of the committee in terms of
where it\'s becoming more problematic and we don\'t like the term pinch
point but it\'s along those lines but not getting into anticipating lots
of challenges and issues and that\'s still a little bit of a gray area,
but, pulling back on making recommendations potentially and more
observations and where it\'s working, not working, and what additional
tools, that kind of notion.

I mean, just so because I think when we come back and really start
looking at the document itself I think that helps give us a lens with
which we want to take a look at the document so some of it then may be
more easily gone through and edited with that in mind. We just want to
get some feedback on that. Is everybody on the same page in terms of how
we\'re trying to frame it.

Carol, then Randy.

MS. TUCKER FOREMAN: I think that it might be more positive, where we\'re
going in the future. I\'m not sure that we have to assume that it\'s
going to be challenging. It\'s just that there\'s going to be \-- how we
organize the future. Now, I don\'t want to get us into stuff that
requires recommendation language but challenging \--

MS. DILLEY: Can you give me an example because that sounds pretty
expansive to me.

MS. TUCKER FOREMAN: I\'m sorry. I just had like language that might
indicate that there was nothing but problems in the future.

MS. DILLEY: Right. I think we\'re talking about to just do this is
what\'s happening, but, we\'re also not trying to do here\'s where we
want everything \-- the way we wanted to play out entirely in the
future. It\'s somewhere in between and I can\'t quite frame it.

MS. TUCKER FOREMAN: Okay. Maybe lunch would help.

MR. GIROUX: I think in the second point as an advisory committee there
shouldn\'t only be a listing of what\'s working and what\'s not working
but maybe we should be saying why it\'s working, the basic reasons why
it works or basic reasons why it\'s not working. Shouldn\'t we be
advising them as to a collective wisdom on that.

MS. DILLEY: Yes. Yes. Good point. That gives us a little bit more
substance too in terms of assessment. And then I think what we haven\'t
quite captured is building off of those observations, what additional
things this committee has to say and I don\'t know, Michael, you just
said observations for the future or something like that.

DR. SCHECHTMAN: Very neutral.

MS. DILLEY: And I think the tools that are out there or are there
additional things to consider. It\'s just \-- and it could be that we
put that as a placeholder and then it will be a little more clear after
lunch and we\'ll have the first two bullets to start working through the
document. That category will get a little more definition.

Anything else in terms of \-- if that makes sense as a framework then I
think we can come back after lunch and start looking at the document,
working it. But, I would suggest we take a break now. Can we come back
at one maybe instead of 1:20?

(Discussion off the record)

DR. SCHECHTMAN: Before you head off, our speaker may not be here so we
may be starting this discussion again and the speaker is supposed to be
here after lunch. And I have one other question. This is off the record.

(Discussion off the record)

(Whereupon, a luncheon recess was taken at 11:49 a.m.

[A F T E R N O O N S E S S I O N]{.underline} 1:21 p.m.

DR. SCHECHTMAN: To get back to the business at hand I\'m pleased for
this meeting we will have two speakers, one for each of the two days of
the meeting and today\'s speaker will be from USDA and she\'ll provide
some additional information about the status of organic farming in the
United States. In earlier presentations we heard quite likely that USDA
had not been able to do certain types of surveys on the organic that
they had done at one point only to budgetary constraints.

But, it turns out that the industry as a vibrant agricultural sector is
still nonetheless being actively followed and investigated by USDA\'s
economists. Catherine Greene, who is a senior agricultural economist
with USDA\'s Economic Research Service is here to speak to the committee
today about USDA research on the organic industry.

Cathy, welcome and special thanks for agreeing to come and talk to the
committee on pretty short notice.

DR. GREENE: Sure. Let me just as a preface sitting down and not standing
up and being a little more animated. I had arthroscopic surgery on my
knee so I\'m still in the recovery period and so that was the
explanation for what it\'s worth.

What I\'m going to do today is try to give you a broad overview of what
you\'re going to expect and what the organic sector looks like\-- and
I\'m going to start off with telling you a little bit about the rules
because they\'re somewhat unprecedented in terms of the scope of these
rules for an eco label and then I\'m going to talk a little bit about
the size of the market per se, organic sales, which I think you maybe
heard a little bit before, so I won\'t go into it real deeply.

Then I\'m going to show you some slides of what the farm sector looks
like in the U.S. and then finish it up with what some of the research
that we are just now undertaking in the Economic Research Service to
actually get a handle on the economic of organic farming.

So, first slide. Let\'s start out with USDA\'s formal definition of
organic production system.

(Discussion off the record)

DR. GREENE: Let me just read it. It\'s just one sentence and it\'s
pretty helpful. The USDA definition of organic production is a
production system that is managed in accordance with the Organic Foods
Production Act and regulations to respond to site-specific conditions by
integrating cultural, biological, and mechanical practices to foster a
cycling of resources, promote ecological balance, and concern for
biodiversity. So, basically it\'s an ecologically-based production
system.

And, again, I\'m focusing on the organic sector today. Organic is just
one eco label or production processing type label. There\'s also a
natural label and in contrast with the 127 Federal Register pages or
whatever it is for what the standards are for organic production the
natural label is just a one sentence definition that says, essentially a
food that\'s minimally processed with minimal additives.

In 2005 organic was approximately 14 billion dollars out of the
approximately 21 billion dollars of organic and natural products. In
addition to the natural label there\'s also fair trade label which is
mostly imported bananas and coffee from developing countries and
there\'s a host of developing labels like free range and authentically
grown labels that don\'t have a huge, including a lot of labels don\'t
have a huge, market share at this point.

Next slide. Okay. So, for right now we\'re concentrating on the label
that does have one of these definitions, organic. The first slide is
just basically the rationale for why USDA published, developed
regulations. One, to establish national standards governing the
marketing of organically produced products, basically to develop a
uniform standard because at that point in 1990 when the rule was created
as part of the 1990 Protection Act, the 1990 Organic Foods Protection
Act, part of the Farm Bill in 1990, there were at that point thirty-some
certifiers' definitions in the U.S.

Second rule goes to consumers. Second reason, I\'m sorry, to ensure
consumers are benefiting from these products and meet a consistent
standard and, three, to facilitate interstate commerce for organically
produced and processed foods.

Also, along with that it has greatly facilitated trade in organic food
products. Third slide. USDA\'s national organic program went into effect
in October 2002. All domestic organic production and all imports must be
in compliance with the rules and the provisions touch on everything from
how we produce the food, how you process the food, to how you can label
the food, who gets to use the organic USDA organic seal, the need for
certification among everybody who wants to claim it or get product. The
only exception being unless they sell less than \$5,000 worth of
product, of organic product, and finally, all \-- finally, the
requirements for accreditation and certification.

This slide shows you a little bit. I had already mentioned the exception
of \$5,000 or less. The certification process itself involves an organic
plan. It involves record keeping, incredible record keeping, and it
involves manual on-site inspections.

Organizations that provide certification services can be state, private,
or foreign. They all have to have accreditation from the Department of
Agriculture and meet USDA\'S organic production standards. I\'ll just
mention a little bit about what producers and processors have to do. The
crop standards cover a transition period. They cover rotation. They
cover the pest and nutrient management input. They cover fees and
transplants you can use.

For this audience, obviously genetically modified organisms were
excluded from use in organic production systems, along with irradiation.
One thing that you\'re probably aware of that USDA did not set a
tolerance for how much material, GMO material could be in an organically
produced product.

It did set out limits and in general the rule itself is a process-based
rule. It\'s not a product rule. It\'s a process-based rule. So, there
are exceptions to that though and that is USDA did say only pesticide
residues can only be 5 percent of the pesticide tolerances that are set
by FDA for all food.

So, it did have that one product-based tolerance level set. It didn\'t
do it for GMO\'s. However, buyers have done it. Buyers have set very low
tolerance levels in a lot of cases with zero tolerance levels. Livestock
standards, obviously they have to use organic feed, they have to use
organic pasture, hormones and antibiotics are prohibited. They have to
provide access to the outdoors and for livestock that means also access
to pasture.

Processors have restrictions on the inputs they can use and they have to
avoid prohibited products all through the distribution process. This
slide gives you the seven criteria that were embedded in the enabling
legislation for what can and can\'t be used in an organic production
system, materials that can and can\'t be used in an organic production
system.

I\'m not going to read the list but it touches on toxicity, human
health, probability for contamination, and also compatibility with
sustainable agriculture.

USDA\'s organic labeling requirement. To qualify for the USDA organic
logo you have to have 95 percent organically produced raw or processed
agricultural products in your product. Another salient thing is that the
rule itself did not prohibit the use of additional eco labels and a lot
of organic products do have additional eco labels.

USDA organic certifier accreditation and import equivalency. I\'m not
going to go through that, but, basically I guess the point that I want
to make is how stringent the USDA organic rule is, not only do producers
and processors have to follow an absolutely enormous set of regulations,
requirements, and standards to be considered organic, the certifiers
have to meet a very rigid set of business wherewithal requirements in
order to get accreditation for providing certification services.

USDA organic food sales. I think Karen Wilcox from OTA may have gone
over some of this material a few weeks ago. The organic food sector has
been growing in double digits for actually for at least a decade and a
half. That\'s partly what started the humongous attention that the
organic sector has from major food companies all over the U.S. That
double digit growth pattern has started to slow a little. I think the
industry sees it at least being double digits at least through the end
of the decade.

In 2005 we were at \-- in 1997 organic food sales were 3.6 billion in
the United States. In 2005 they were approximately 14 billion in the
United States and that represented about 2.5 percent of the U.S. retail
market for food. Among the categories of U.S. retail sales for organic
food, the big one is still fruits and vegetables. That was the biggest
one when organic food started being sold in the United States many
decades ago, and it currently represents 42 percent of total U.S. food
retail sales.

Packaged and prepared foods have been growing very fast for the last
full decade, basically they\'ve been growing very fast. Dairy in the
United States is still in a shortage of organic dairy products. Meat,
fish, and poultry is the smallest sector at this point but it\'s been
growing super fast essentially since the rules were implemented in 2002.
Of food products in the U.S., meat was not allowed to carry an organic
label until the end of the 1990\'s and so we had an alternative label,
natural beef gaining the market share during the 90\'s and organic meat,
now that can be labeled as organic, is starting to catch up.

This slide is sort of the flip side of the slide I just showed you.
Fruits and vegetables were the \-- claimed the biggest segment of the
market. That\'s why you see that they\'re growing as well and you see
meat, fish and poultry growing the fastest at this point. So, basically
it\'s an illustration that demand for organic food encompasses pretty
much every single food category in the grocery store.

Sales of organic food obviously used to be concentrated in natural food
stores, independent supermarkets for the most part many decades ago.
We\'ve gone through the transition where organic food started being sold
hugely in huge natural food supermarkets and now we\'re in the
transition where they\'re being sold in traditional food supermarkets
and huge conventional supermarkets and I\'m sure everyone here heard
WalMart announce their entry into the organic market last spring.

And, at this point, I wanted to move into talking about the U.S. organic
farm sectors just a little bit. AMS has been collecting data from
certifiers \-- I\'m sorry \-- been collecting information from
certifiers to try to get a picture of what the farm sector looks like
for about a decade and essentially we\'re compiling information from all
the certifiers in the United States that provide certification services
to organic producers. And what we\'re showing is at this point in time
we have about four million acres and in 2005 we had about four million
acres of certified organic farm land, including both pasture and crop.

About half of that is crop land. This is color coded so I\'m going to
look at the graph. The green is the crop land and I just want to make a
note that the pasture has been a lot more erratic. Right now we have
really big pasture operations that are kind of disproportionately large
while crops have been growing very steadily throughout the whole period
we\'ve been looking at this information. And in this slide, California
started out as the big state in organic and is still the big state in
organic.

Interestingly, I expected a few years ago that at this point we would
have already been concentrated on grains in the Midwest because there
was large production of grains in the Midwest in terms of organic
production, but, California was still the top state in 2005 for crop
land with mostly specialty crops and conventional.

Okay. This slide shows a steady increase in certified organic crop land
at about 10-15 percent a year since the early 1990\'s with some periods
where it jumps a little bit faster. And then I wanted to show you how
much it varies between crop sector in terms of adoption levels for
certified organic farming systems. For fruits and vegetables, fruits are
about 2.5 percent \-- I\'m sorry \-- fruits, about 2.5 percent of all
fruit acreage in the United States is managed under certified organic
farming systems. About 5 percent of all vegetable acreage in the United
States is managed under certified organic farming systems.

Specific crops, carrots 6 percent, lettuce about 4 percent, apples a
little over 3 percent, and, you know, some of these crops, extension
economists expect to see really jump even faster in the next few years
because of demand from WalMart.

In contrast, acreage for field crops has been much, much smaller. About
0.2 percent of U.S. corn acreage \-- about 0.2 percent of U.S. corn
acreage in 2005 was under the certified organic system. 0.2 percent of
U.S. soybean acreage under organic systems. Wheat was a little higher.
Obviously it\'s more of a food use crop and it was half a percent. Rice
was nearly one percent and dry beans were a little over three percent in
2005 under the organic systems.

Okay. The last section that I\'m doing today is to talk a little bit
about the research primarily in USDA but also a little bit about the
expanding availability in statistics in the department on organic
production.

USDA in the late 1990\'s ERS published a report and we included with
that an appendix of what a number of agencies, line agencies in the
department were doing on organic activities, either regulatory
activities or protections, research, or, marketing research and we
basically found nine agencies with a notable program going on. At this
point I think it\'s more than that.

Next slide. In terms of statistics, ERS has been monitoring the amount
of certified organic acreage and livestock in the U.S. We\'ve also added
an organic over-sample to our huge annual economic survey, the ARMS
survey. Most of you are familiar with that, our Agricultural Resources
Management Survey.

A few years ago we added an organic over-sample and we\'re just now at
the point where we\'re doing \-- we\'re starting the same kinds of
research activities on economic activities on organic that we\'ve been
doing on conventional and also ERS has funding from the Risk Management
Agency to do a nationwide organic processor survey and the results from
that will probably be coming out this year.

The National Agricultural Statistics Service has been started, five
years ago added these questions on organic agriculture and that was in
2002. They\'ve expanded that to 2007 and they\'re also administering our
survey obviously. The USDA Ag Marketing Service for well over a decade
has published some organic produce prices and two years ago started
publishing a weekly market news on organic poultry and eggs and at this
point have some other price activity pilot project.

USDA\'s Foreign Agricultural Service has made an estimate, one estimate
in 2005. They made an estimate of 2002 export and import statistics for
organic agriculture. It\'s kind of interesting. They estimated that the
U.S. was importing a billion to a billion and a half worth of organic
product in 2002 and was exporting about 150-250 million in organic
exports. So, already our trade balance was affected. We do not have
trade statistics, official trade statistics on organic agriculture
because we don\'t yet have codes in the harmonized trade code system and
that is a project that the Foreign Agricultural Service is working on to
try to remedy.

One thing that we do know is that 43 countries are importing organic
products into the United States, either through a certifier located in a
foreign country that\'s been accredited by USDA or by a U.S.- based
organic certifying agency or under some sort of reciprocity agreement.

Federal organic inspection activities. The nine agencies that were doing
stuff before, a lot of that focuses on market facilitation obviously
setting the uniform standard, doing market research, loading organic
exports, which is one thing the Foreign Ag Service is doing, research
and education. The Farm Act in 2002 expanded in a very small way funding
for an organic research grant project and the Risk Management Agency is
working on developing better crop insurance programs for organic
producers, certification cost share and conservation programs.

There\'s a 15 state organic certification cost share program that
started in early 2000 and was expanded to all 50 states when the organic
rules were implemented in 2002 and at this point in time I think that it
is back to the 15 under-served states, although I think there\'s a lot
of interest in having it expand back to all 50 states.

One other interesting thing is that some states in the U.S. have used
the federal EQIP Conservation Program to provide some transition funds
for producers who want to certify into organic production because
transitioning into organic production means basically going for three
years without chemical input or other prohibited input and not being
able to get an organic pricing during that period.

Okay. So, now I\'m going to say a few words about our agency. We have
some organic activity in all three of the major divisions in the
Economic Research Service at this point. The Food Economics Division has
bought the supermarket scanner data and is doing a consumer demand
analysis on the demand for organic food in the U.S. It\'s looking at the
characteristics of the food in this case, the different characteristics
of food demanded by the consumer.

The Market and Trade Division is also doing research on organic food
markets and our organic food distribution and is doing the project to
look at producer price, to look at the processor\'s distribution
channels, processor/farmer relationships and other aspects of organic
food distribution in the U.S. And then the Resource and Rural Economics
Division is looking at the adoption of organic farming systems, looking
at literally where and how much has been adopted and also looking at the
economic survey, agricultural resource management survey.

Okay. Very briefly, and I\'ve already mentioned this so I won\'t
elaborate on it, but, we have been tracking the adoption of certified
organic farming systems since the mid 90\'s. We\'ve done that by
collaborating with the fifty or so certifiers in the United States, also
with other USDA agencies and also with several offices of USDA National
Ag Statistic Service.

And that data is all posted on line on our ERS organic data briefing
website. Organic activities, research and analysis on specific markets.
I\'m just going to give you a couple of examples here. The last project
that we did on looking at the trends of organic food and released a
report on trends in organic poultry and eggs, that\'s in our organic
briefing room. The organic briefing room basically has everything that
we published on organic so it has the data products with the certified
organic acreage and livestock estimates. It has the historical data
products where we\'ve taken the AMS data on organic poultry and organic
produce and combined that with their traditional data on those products
and developed an historical comparison database and then it also has
probably 30-40 articles and reports that we\'ve published on organic
agriculture in the last decade or so.

I\'ve mentioned that ERS is collaborating with RMA on a nationwide
handler survey. And I\'m just going to say another word about the ARMS
survey. This is a really involved project because essentially organic
agriculture is such a tiny segment of U.S. agriculture there\'s no way
that we could have done any kind of economic analysis on this sector
without doing a really large organic over- sample. And that\'s obviously
a really big cost undertaking and we did get funds from Congress several
years ago to add that sample and what we were adding \-- what we added
was dairy in 2005.

We expect to publish side-by-side cost of production estimates for
organic and traditional dairy production this spring. We\'ll publish
that both in the ARMS website and also in the organic briefing room
website.

We added an organic soybean over-sample in 2006 and that data, that
survey, will actually just come back in the next month or so. This is
the first time we\'ll see that data. Hopefully, we\'ll get some research
products out on that this year and we\'re in the process of designing an
apple survey and apples, not only do we have organic over-sample for
apples, but, just having a specialty crop in the ARMS survey is
historical. We\'ve never had a specialty crop before in the ARMS survey.
This gives us, again, enough unprecedented opportunity to do the
research on an important segment in U.S. agriculture.

And I think I\'ll just close there. If I didn\'t talk about what you
really wanted to hear about, you can ask questions.

DR. SCHECHTMAN: Thank you very much, Kathy. That\'s was a really
interesting presentation. I think we\'ll try to make copies of those
slides for folks. I know I have enough trouble reading them from this
distance so we\'ll try to get you copies of those slides and you can
take a look at them.

I just wanted to say before questions that it\'s a somewhat different
impression that I heard today on the level of activity that is going on
on analysis of organic by USDA and I think that\'s really very helpful
for the committee.

MS. GEISERT: Thank you for your presentation. I work for General Mills
so we\'re a bit involved in organic, but, I was wondering one of the
conversations we had was about education and from all the small
marketing you\'re getting survey data. From your perspective what do you
see USDA doing to help make aware to a broader population base, you
know, the opportunities or the challenges in entering into the organic
market?

DR. GREENE: It sounds like you\'re asking both about the consumer side
and the producer side.

MS. GEISERT: The producer side.

DR. GREENE: Producer side, I\'m not sure I\'m the best person to answer
that question. I think probably CSREES would have a decent answer for
you. Right now the department does not have a consolidated website for
producers to go to who wants to transition into organic production but
the CSREES Sustainable Research and Education Programs has a number of
technical bulletins out there, including one on transitioning to organic
production. It\'s very hard to find, although, you know, it\'s very
useful.

The prices \-- we\'ve got some prices in our website that are all
historical winding into the organic production piece and the Ag
Marketing Service website probably is somewhat mysterious.

MS. DILLEY: Well, asked a different way you see knowing that information
is part of the factors and adoption rate. Are you picking that up on
your survey just in terms of growers knowing that there\'s an option out
there or how to transition? Is that affecting adoption at all or are you
not picking that kind of information up?

DR. GREENE: Yeah, I\'m not sure you\'re asking some sort of direct
question.

MS. DILLEY: I don\'t know if that\'s the way to ask the question.

MS. GEISERT: How do you get information to make informed choices early
in the supply chain because it might have been in different places but
that I don\'t know.

DR. GREENE: Well, I think the USDA has some really good data available
and I suspect in the process of making it better consolidated so that
producers can reach it more easily.

MS. DILLEY: We have a lot of cards up from Mardi and Russ, Alison, and
then Carol. Mardi.

DR. MELLON: Thank you for the presentation. There is more going on than
I thought. Some of it seems to be very recent but that doesn\'t matter.
It\'s on its way and that\'s good. I wondered if you had a view: we\'re
kind of operating in this committee on the assertion or assumption that
the U.S. has the largest organic agricultural sector in the world and I
wondered whether that\'s the way you see it either in terms of acreage
or sales. Is our organic sector the largest in the world?

DR. GREENE: No. Our organic sector is not the largest. Australia\'s
bigger than us, considerably bigger, and Argentina is bigger than us,
considerably bigger and I think Italy is hand-in-hand with us at this
point.

DR. MELLON: Just by itself, not the EU?

DR. GREENE: Yeah. I didn\'t bring my slide. I should have brought a
slide on U.S. and worldwide production, but, the U.S. is probably not
\-- well, it\'s not probably \-- the U.S. is not growing nearly as fast,
the U.S. organic sector is not going nearly as fast. Now, I\'m talking
about production sector, as the organic production sector in many, many
other countries in the world. The organic production sector in China is
growing more than a thousand percent a year. The organic production
center in a number of the Eastern European countries is growing that
fast. The organic production sector in a number of developing countries
in Latin America is growing. I think there are about a half a dozen
countries that are growing well over a thousand percent a year in terms
of certified organic acreage.

MR. KREMER: Yes, following up on Mardi\'s comment concerning the
presentation, I\'ve attended several organic trade associations,
conferences, and whatnot and it does seem like over half the vendors are
from overseas or from other countries and I guess my question probably
is two-fold and related to that. Number one, what does that attribute to
as ERS or somebody kind of analyzing the situation? Is it strictly due
to price or what are the other reasons that we have such a great
imbalance of organic trade?

The other thing related to that is you talk about this import
equivalency thing. What are we doing to monitor and keep track of
whether the other countries\' certification standards are up to par with
ours?

DR. GREENE: Let me address the first question first and that is checking
up on countries that are importing organic products into the U.S.
obviously they are required to be certified by a USDA accredited
certifier or have some sort of reciprocity agreement negotiated with the
U.S. and what the U.S. is doing for countries where there\'s specific
concern that\'s growing, I think meeting with officials in those
countries and, you know, I think the right group to ask that question is
really the Agricultural Marketing Service that monitors the national
organic program.

I know that the NOP has just come back from a really big trip to China
and other Eastern countries. And then the first question, trade
imbalance, well, the information that we\'ve been tracking on certified
organic acreage we saw soybean certified acreage in the U.S. decline
starting two years ago. We saw certified organic cotton acreage decline
starting five years ago. Well, the real market for cotton, the U.S.
market for certified organic cotton and the world market for certified
organic cotton is still growing very fast.

The U.S. is just playing a huge role in that market. Partly, for cotton,
for example, it\'s partly due to having import competition in places
that have lower wages and I think field crop production may be a special
challenge for transitioning into certified organic production as well.

DR. VAN EENENNAAM: I guess just following up on this trade environment
thing, you said there was 14 billion dollars in organic sales or so in
2005 and I guess if you extrapolate from the 2002 if it\'s a one to
eight production then you\'re really talking about only two billion of
that actually being American.

DR. GREENE: No, I\'m sorry. The U.S. organic imports were 1.5 billion
and that was out of I think in 2002 the market was about 10 billion.

DR. VAN EENENNAAM: Okay. I guess one of my other questions is you were
talking about some countries with a thousand percent growth rate so I\'m
just curious. Are they consuming that product in their country or are
they growing at that rate because they see a market in America that has
a lucrative outlet for their products and so are we actually seeing an
increase in organic egg production that are organic in other countries
to satisfy the demand for the organic sales in America?

DR. GREENE: Yes.

DR. VAN EENENNAAM: Okay. Given that we\'re talking about coexistence and
are you aware of issues that are affecting our egg production sector\'s
ability to service our own markets? Is it coexistence that\'s affecting
that or are there other factors that are plowing into that kind of
balance that\'s going on?

DR. GREENE: Coexistence may be an exacerbating factor. I mean, it\'s
certainly an enormous concern among organic producers because of the
difficulty \-- you know \-- the national organic rule specifies borders
but borders don\'t necessarily stand up to obviously to many, many miles
of wind-blown pollen and organic producers also alter planting dates to
try to offset if they have crops that are not in pollination from their
neighbor\'s crops are pollinating but I think that\'s in cases also
makes their crop less marketable. I think, yeah, there\'s a lot of
challenges with that issue specifically.

MS. TUCKER FOREMAN: Thank you very much. I\'m a consumer of the data on
your website. It\'s really terrific for people like me who are looking
for information and it\'s really very accessible as well as available.

I\'m troubled, since we all came to believe that in the brilliance of
the marketplace, farmers get an increased premium both at the farm gate
and then there\'s a further increased premium at post sales for organic
products. The market for organic products is growing in the United
States. Since we are largely a mature market, it\'s clear that the
organic or I think it\'s clear that the organic sales are to a certain
extent replacing conventional sales. I don\'t think there are people,
even though we\'re all getting fat, I don\'t think that it\'s because
we\'re eating organic on top of conventional. We\'re importing more and
more organic products.

Now, I don\'t understand. Why is there still a premium for these
products and there\'s truly a market for them and we\'re importing to
meet that market, why isn\'t the market generating more organic
production and since we\'re talking about coexistence in this committee
what forces, you mentioned a couple, but, what other ones are out there?

DR. GREENE: The U.S. hosted a USDA workshop on organic agriculture about
a year ago, about a year and a half ago and we invited several large
conventional, organic corn and soybean producers to come and tell us
what the challenges to growing organic were that had, you know, had
stopped them from plunging into that market. They both said that they
thought the organic market was very tempting but they mentioned, you
know, they mentioned the fact that they got really spread-out farms.
They don\'t have hedgerows. They don\'t have fences. They don\'t have
livestock. They don\'t have a lot of things that would make it easier to
produce an organic system.

So they literally said to go from a conventional system to an organic
system is, you know, changing your entire world around and it\'s an
enormous commitment and at this point there\'s really aside from the
really tiny couple of states that are providing relatively modest
organic transition funds during that brief three-year period where you
can\'t get that organic premium, you know, there\'s really no support
system for producers in making that switch.

MR. KALAITZANDONAKES: I was wondering if you could tell us what is the
acreage in Argentina and Australia for organic agriculture and what is
the composition of that?

DR. GREENE: Australia and Argentina are much more heavily \-- we\'re
about half and half on pasturing crops. They\'re disproportionately more
on pasture versus crops. Obviously they have pasture-based livestock
systems there and we\'re still not totally in that boat here even within
the organic sector.

MR. KALAITZANDONAKES: Do you know the numbers?

DR. GREENE: The numbers, I believe it\'s something like 11 \--

DR. VAN EENENNAAM: In the documents, if you hold on one second, it has
the hectares but you can do the math. It\'s the first page one, the
comment there, but, basically Australia is 31 million hectares \--
excuse me \-- yeah, that was 31 million. 11.8 in Argentina. 31 total.
11.8 for Argentina with 3.1 China and 2.3 and U.S. 1.3.

DR. GREENE: China, yeah, China\'s the third one, right.

MR. KALAITZANDONAKES: So, do you have an example out of the 12 million
hectares how much of that is pasture versus crop production? That\'s
what I\'m asking.

DR. GREENE: I can\'t \-- I don\'t know what it is off the top of my
head.

DR. VAN EENENNAAM: I\'m guessing it\'s mostly pastures.

MR. KALAITZANDONAKES: No, it\'s not. I mean, that part of the discussion
would have is what impression do we have about the statement in the
beginning in the document was crop production, organic crop production,
and when you add pasture that changes the \-- all right. So, that\'s
what the differentiation takes place.

MR. CORZINE: I have a question along those lines. When you create your
listing as far as organic production by countries is your measure is it
in acres or a volume or is it dollar sales or what measure is used?

DR. GREENE: The statistics that I\'m aware of on worldwide production
are compiled by a non-profit in Europe and so they\'re from everywhere,
those statistics. So, they\'re from, you know, the U.S. Government
sources as well as the European Government sources because obviously the
European Union subsidizes organic production so relatively good
statistics are available from the EU on production but in some of the
developing countries I\'m imagining the statistics are a little softer.

MR. CORZINE: The reason I ask is because as far as rating and ranking
the U.S. is at total dollar retail sales and it might be a lot different
if you grow a lot of fruits and vegetables in your pastures.

DR. GREENE: When I mentioned Australia, Argentina, and China that are
ahead of the U.S. they\'re ahead in terms of acreage, total farm land,
certified organic farm land acreage.

MR. CORZINE: Acreage. Okay. Because it figures I had seen that in dollar
sales.

DR. GREENE: Dollar sales, well, \--

DR. VAN EENENNAAM: There would have to be some because of all the input.

MR. CORZINE: Yeah, yeah. Yes.

DR. GREENE: Basically the EU and the U.S. and Japan are \-- in Japan and
Canada are kind of a way distant third are the big markets. I mean,
really the EU and the U.S. are the big markets. A lot of countries have
small developing domestic markets, but, those are really the big
international markets.

MR. CORZINE: Really my question, we were kind of on that subject. The
producers as far as I think there\'s a lot of networking going on and
we\'re getting information now. I don\'t know when I take a look at
different markets and I\'ve got an organic neighbor and we talk and how
he\'s doing and how I\'m doing and those kinds of things it\'s more
networking. I\'m not sure, no disrespect at all, but, the USDA can
really \-- I wouldn\'t go to the USDA site to get information whether I
was going to grow organic or not so a question on the import.

So, we do put U.S. organic label on imported organic products?

DR. GREENE: Yes.

MR. CORZINE: Okay. And the other question I didn\'t quite follow on the
pesticide tolerance, which was a chemical residue, there\'s a FDA
standard and you mentioned organics it\'s five percent below what the
FDA standard is?

DR. GREENE: Yeah. Basically FDA sets a tolerance for how much pesticide
residue can be on a food product. You\'re right, EPA sets the tolerance.
FDA monitors it. EPA sets the tolerance and the USDA basically sets an
organic product can\'t be more than five percent of that tolerance.

MR. CORZINE: Right, because of the residual. Because in talking with the
networking with organic folks I know they have more issues around the
pesticide residues and as far as getting things rejected or whatever
than they do around a pollen drift issue or something like that because
even though a pollen flows it doesn\'t really live that long and in the
organic standards you aren\'t disqualified from the organic standards or
qualification by whatever adventitious presence you might have because
that\'s not in the organic standard, correct?

DR. GREENE: That\'s right. The only ERS research that I have to date any
statement from was a set of listening sessions that ERS did about four
or five years ago, three or four years ago was this management agency
funded project.

MR. CORZINE: One last thing. As I talk to folks around the country it
seems like on why producers, why we have more import and it\'s not grown
here, grow organic, and from your experience and your surveys it seems
to be as much to do with labor issues as anything else. Is that what
you\'re finding as well?

DR. GREENE: Well, we\'re just starting the process for really getting
good economics on the organic sector. I mean, we\'re just on the verge
of publishing our very first culture production analysis. From all the
literature labor is a huge issue. The different sectors are different. I
think why you see a reduction rate in the fruit and vegetable sector is
going to be a lot different. You know, the problems they\'re having are
different than the problems that we see in the sector where labor is
really a huge issue whereas, you know, the field crop sector where
we\'re seeing very small organic production systems, labor is not
typically the number one issue.

DR. SCHECHTMAN: We\'re running late. We\'ll take the cards that are up
now but try to make questions or comments brief so we can move on to the
next step. I know there\'s a lot of interesting presentation.

MS. DILLEY: Adrian.

DR. POLANSKY: Yes, I\'ve got a few comments and I\'d be interested in
your reaction. What I would say, whether it\'s Alaska or Australia or
South China there\'s really, you know, large expanse. There\'s not a
transition issue because they have \-- that\'s the way they\'ve been
farming. They have not had access to genetically enhanced yields through
genetically enhanced traits and varieties so, one, they don\'t have the
transition, and, two, they\'re not giving up that additional
productivity that some of us have gotten quite accustomed to and that\'s
with the one thought that I would share.

And then back to the labor issue. And I would say that, as a thought,
that in the commodity crops indeed labor is the issue. It\'s a bigger
issue, I would contend, than in the fruit and vegetables. When I was in
high school I started hearing about soybeans and I mentioned it to my
father that I\'d like to plant the soybeans and he said, well, I\'ll buy
you a hoe and, you know, even though there were a few herbicides
available at that point in time we still needed a hoe and prior to the
latest round of genetic enhancement not only we had hoes we had cord
knives and we had every high school kid we could get to work and then we
had crews of Hispanics that were through the area at that point in time
that went through the soybean fields.

Labor is a transition issue and the lack of access to more modern
techniques. It\'s a huge issue and labor is a huge issue and if someone
\-- you know \-- I\'m really interested in economic analysis and
probably far beyond what you\'re looking at at this point because it\'s
huge. It\'s not just in agriculture but it\'s used across the board. You
know, we\'re having an easier time recruiting companies than recruiting
people to work in those jobs.

So, labor is a big issue in this country and if you change the kind of
agriculture we have in a significant way. Somewhere there\'s got to be
labor that we don\'t \-- even if we wanted to pay for it I would contend
we can\'t access. I\'d just like to hear your reaction to that.

DR. GREENE: Yeah. I\'m truly not going to dispute that. I am hopeful
that we do have economic research underway that will encompass some of
these issues a lot more thoroughly than we\'re capable of doing right
now.

MS. BRYSON: Great presentation. I guess I wanted to understand more
exactly what is the nature of the data that ERS has on this? I think you
said that you\'ve added it to the big ARM survey but you\'re still at
the threshold of really developing some reliable information.

DR. GREENE: Right.

MS. BRYSON: As part of that are you looking at barriers for U.S.
production for more U.S. products for the farm and market community?

DR. GREENE: Yes. Two projects, two survey projects related to looking at
production. One is this project that we\'ve been tracking the adoption
level based on information from the certifiers in the United States.
Basically we\'ve been getting information from these USDA
state-accredited organizations in the United States that help determine
how much acreage they\'re certifying for different crops and how much
crops they\'re surveying based on the records that they get. So, that\'s
the one project.

The other project is the one that we\'re pinning our hopes and dreams
for doing research on and that is adding the large over-sample to ARM,
an annual growth survey, the USDA annual producers' survey that we use
to get basically all of our economic financial indicators on from cost
of production for targeted funds to the financial well-being.

MS. BRYSON: Does the website have the states that are using the EQIP
program for the transition?

DR. GREENE: That information was in some of the reports. It includes
Iowa, Minnesota, and California.

MS. BRYSON: Thank you.

MS. TUCKER FOREMAN: I\'m still trying to figure out some of the market
issues here. Do you have data on the rate of return to the producer for
crops input, output, rate of return, and a comparison on how it compares
with conventional?

DR. GREENE: That\'s the kind of information that we are hoping to
produce from the data from ARMS survey.

MS. TUCKER FOREMAN: We did, as I recall, have an organic farmer who
acknowledged that his costs were high and had an organic farmer at the
very beginning who acknowledged his costs were higher but he stated it
made up the difference so that\'s why he\'s doing it. Do you have any
data that suggests that there\'s a limit on demand for these products?

DR. GREENE: I\'m not going to make any crystal ball forecasts as an
agency preference.

MS. TUCKER FOREMAN: Did you get any sense from your workshop, getting
away from the numbers, that farmers were reluctant to do this because
they feared that it was a passing fancy or they weren\'t comfortable
being out of step with the neighbors or other non-economic cultural
concerns?

DR. GREENE: Yes, yes. The workshop, the farmers participating in the
workshop certainly specified cultural consideration were part of the \--
part of what made it difficult to grow organic. And, you know, even \--
and also obviously the uncertainty of the market. Markets are always
uncertain and, you know, committing to change in production systems
without being able to tap into the higher price premium for a few years,
for three years, is a big, big step.

MS. TUCKER FOREMAN: So, again, you mentioned the transition. I just have
one more in that series. Did they come in with the lack of a support
system or the need for a support system to make the transition to have
the information that\'s necessary to succeed in a new way of doing
things?

DR. GREENE: Yes, but, big traditional farmers did say that not having
access to informational materials that\'s available for conventional
farming was an issue for them and I think that the person that spoke
here earlier about the farmer-to-farmer network in the organic
community, you know, was also tapping into a significant characteristic
of the organic farm sector and there was tremendous information-sharing
in the organic farm sectors from the listening sessions probably more,
you know, we got a feeling from organic farmers it was more important
for them to be in than in the traditional community at large.

MR. FLOWERS: As a producer I want to make some statements. I feel like
the U.S. farmers are held to a higher degree of accountability farming
than these imports that are coming in. Labor, like everybody\'s been
saying, is a big part of why we don\'t grow a lot of organic. We have
worker protection laws which are very good. We pay higher wages. These
developing countries, I\'ve been there, they\'re paying very low wages.
They compete against us. They use child labor. You know, it\'s just so
much cheaper for them to produce, which is an unfair advantage to them
selling over here in the U.S. and that\'s a lot of the problems.
They\'re just able to do organic farming cheaper than we are and that\'s
the reason where a lot of this is coming from imported in and I kind of
wonder about, you know, are they really doing it the way they\'re
supposed to be doing it here?

You know, who is monitoring, you know, their certification? So, I have a
problem with it, the way it\'s perceived, you know. It\'s great to grow
organic, but look at the price we\'re paying to import it in here.

DR. BUSS: I have a couple of unrelated questions. First, on the cost
comparison you\'re projecting for cost of production. I was speaking to
the goal of having cost and production comparisons on the website and
specifically speaking to Jerry I was specifically interested in knowing
given the diversity of conventional production type when is that going
to be benchmarked again?

DR. GREENE: We are going to break it down regionally.

DR. BUSS: But, I meant if you look at grazing during organic systems
versus conventional confinement, they\'re very different.

DR. GREENE: Well, for organic breaking it down regionally captures a lot
of that and there\'s hundreds of pasture-based systems, whether organic
or conventional, in the upper Midwest, for example, than in other parts
of the U.S. Now, we\'re breaking it down regionally in low-grazing
pasture systems too, just depending on what the data allows and we
haven\'t gotten that far in the research yet, but, there\'s a tremendous
amount of research going on with this data. We\'ve got a really good
response rate. We\'ve got a good example for organic as well as for
conventional and we got a really good response rate and we\'ve got
cooperative research going on right now and we have regional researchers
in ERS working with this data.

DR. BUSS: Second question I had was that one of your earlier slides you
showed a list of factors or considerations and I think this really
pertained to organic vegetables as the factors that are either
prohibited or permitted, etc. and one of those was relevance to human
health. Is there a thought when you start looking beyond vegetables and
looking at, for example, dairy organic, is there a thought been given to
having a counterpart for animal health?

DR. GREENE: Animal health is part of the USDA rule.

DR. BUSS: So that would be one of the factors?

DR. GREENE: That\'s one of the factors I put was the factors that were
done in the legislation for the USDA organic rule which specified what
materials can go onto the national list of synthetic products allowed in
organic production and natural products prohibited in organic production
with the basic assumption on material use or organic use, the rule being
that natural materials are permitted and synthetics are the most
prohibited and synthetic materials are prohibited unless specified as an
exclusion on the list \-- exception rather on the list.

Now, I\'ll say one statement on USDA rules says that animals provided
are natural \-- their natural nutritional behavioral needs must be met.
And there\'s a whole section of the rule that elaborates the conditions
of that that have to be met in order to quantify something.

DR. SCHECHTMAN: Thank you. Thank you very much for a really interesting
presentation, Kathy, and we particularly appreciate your being willing
to come over here so soon after your surgery so thanks again. You\'ve
been very helpful.

(Applause by all)

DR. SCHECHTMAN: We\'re going to get back to where we left off in the
earlier discussion this morning.

MS. DILLEY: We are a little over about 40 minutes before we\'re going to
take a break just before our public comment period. What we would
suggest is that just looking back on this morning\'s discussion about
the charge, the definition of coexistence, and the three pieces that we
anticipate this paper covering. I\'d like to give people just five
minutes to read through the introduction again just to refresh your
memory, just briefly. If you already have done that, great.

But, just a couple of more minutes to look it over with that in mind and
then we\'ll pick up the conversation and it should only take a couple of
minutes. How about a minute to review that page with that in mind and
then we can start looking at the text and reflecting back on what we
need to do given the setup from this morning\'s discussion how we want
to maybe think about the introduction.

DR. VAN EENENNAAM: That didn\'t change over lunch, right, the
coexistence definition, did it?

(Discussion off the record)

MS. DILLEY: With that kind of a background looking at the introduction
to see how we are setting the paper up to go into that more deeply and
then start looking at the actual text to see where we need to either
flesh it out or what we need to reconfigure as an introduction and I\'ll
stop talking so you can read.

One of the things that came up in the previous session, I think it was
in Nick\'s paper, was this differential between cropland and grazing
land and whether we need to elaborate on that when we\'re talking about
the U.S. market so just anything. I think that was how you started your
paper with really focusing on cropland.

MR. KALAITZANDONAKES: Crop production, yes.

MS. DILLEY: Yes, crop production. Mardi?

DR. MELLON: I guess I\'m still interested whether \-- and I understand,
you know, some of the potential differences between pasture and the
animal agriculture and crop agriculture. For example, I\'m not sure
acreage means much when you\'re talking about animals and animals in a
feedlot you count the acreage by the animal, I\'m not sure.

But, I\'m interested in the comparison on organic crops alone. Do we say
that we produce more than any other country on earth? Are we comparing
ourselves to Italy? You know, we can go to the individual countries in
the EU or are we comparing ourselves to the EU across the board?

MS. DILLEY: Collectively.

MR. KALAITZANDONAKES: You mean the EU whether we are comparing the U.S.
against the EU 15 or EU 25?

DR. MELLON: No. I mean Italy versus the U.S. Are we comparing ourselves,
the U.S. to individual countries in Europe so that we produce more
organic crops than Italy, more organic crops than France, or are we
saying that the EU, that the U.S. produces more organic crops than the
entire EU defined by however you\'d like to define it?

MR. KALAITZANDONAKES: My statement, my original statement was not taking
the U.S. against the EU 15 or EU 25, but, even if we compared U.S.
against EU 15, because I don\'t know the numbers for EU 25, they would
be \-- I don\'t have them in front of me but we might still be larger
than the EU 15 as a whole on crop production. But, it was cut by country
not the bloc.

DR. MELLON: Well, I think we ought to make that very clear because at
least my just assumption because I wasn\'t clear enough whether we were
comparing ourselves to some bloc of EU countries and if we weren\'t
comparing ourselves to individual countries in the EU.

MS. DILLEY: So clarifying that statement obviously is important.

DR. VAN EENENNAAM: I actually had that paper here but I\'m not sure it
specified crop production or just total acreage so I can give you a
chance to look at it.

MS. DILLEY: Daryl?

DR. BUSS: In the context of the introduction I\'m wondering if it\'s
relevant anyway because if it was seen in the context we had before it
looks like it disappeared in quite well over the first sentence that
begins, "Over the last ten years" and ends with the word "acreage". It
seems to me logically close if you go all the way from there down to the
last sentence of the fourth paragraph. It says, the flourishing of these
three sectors suggest the underlying framework has allowed coexistence,
and I\'m not sure I see the relevance of all the material in between,
whether you need it.

MS. DILLEY: You\'re going for the short introduction.

DR. BUSS: That was where I was going too, Abby. With what we have for
the introduction already it looks to me like you could eliminate the
one, two and a half paragraphs and where I was starting, I mentioned
this morning, was, and maybe there\'s a question, Margaret, after the
presentation whether we are the world\'s largest producer maybe we could
insert one of the world\'s largest producers of both genetically
engineered and organic crops as well as the largest exporter of
conventional crops.

And then you could drop down to what Daryl mentioned to the flourishing
of these three sectors suggest an underlying framework for the
coexistence between GE, conventional, and organic crops within U.S.
agriculture and that pretty much covers everything about it.

MS. DILLEY: So, the primary point being these three have flourished?

DR. BUSS: Yes.

MS. DILLEY: And we don\'t need to get into whether we\'re the most or
\--

DR. BUSS: Yeah. If you put one of the largest because I think that would
be without dispute.

MS. DILLEY: That\'s the primary point we\'re trying to make here and we
could say it.

DR. BUSS: And I don\'t see what is needed, why we need those first,
everything before that.

MS. DILLEY: Okay. Alison, Duane, and then Mardi.

DR. VAN EENENNAAM: I guess I would just like to leave in that last
sentence from the first paragraph that I inserted in red there just to
give a relative idea of the proportion of organic crop line and GE crop
line because it sort of sets up the context for coexistence. There is a
lot of genetically engineered crop land and if you just stick to you
don\'t care about the whole EU comparison but we\'re talking about U.S.
agriculture and, you know, it\'s 1 to 100 is the current crop.

MS. DILLEY: I guess if you read that you could talk about the relative
rates of growth or something. I mean I guess if you start there you have
to start talking about some of the other statistics too, to kind of
round that out. Maybe not. That\'s kind of my reaction. But, Duane and
then Mardi.

MR. GRANT: Well, for me it would be helpful I think to have some kind of
a reference to this opening introduction to the fact that coexistence
isn\'t the new thing. I know I brought that up before but I think it\'s
really relevant to this discussion. If you look at Brian Andres\' paper
he points out that many of the tools that are on the table to deal with
coexistence in the context of GE and conventional are in fact tools that
have been open for a long time. You\'ve got growing districts,
licensing, commissions that control what can be offered to the
marketplace, marketing orders, etc. All of those are tools that have
been in existence for a long time and can be and, in fact, likely will
be the same tools that are adapted to a common coexistence in this
context.

So, I think it\'s helpful to set it up that, hey, we\'re not blazing a
brand new trail here. In fact, we\'re just building on something that
the industry already knows how to do.

MS. TUCKER FOREMAN: Could I comment just on that?

MS. DILLEY: Sure. Go ahead.

MS. TUCKER FOREMAN: I agree that it should be in there. I\'m not sure
right after that last paragraph. It seems to me it could drop down about
three as maybe the transition to what\'s working and not working.

MR. GRANT: Yeah. Just a matter of fact, I don\'t care if you delete the
paragraph either really, frankly. I just think that it needs to be in a
set-up.

MS. DILLEY: I think what would be helpful now more than what needs to be
in the introduction and then we\'ll figure out where they fit in terms
of \--

MR. GRANT: And to me that\'s a core component. If you leave that out
you\'re really long.

MS. DILLEY: And, in fact, I think we talked about that earlier this
morning that coexistence has been happening and it\'s not just been
happening relative to these three markets but it\'s been happening. I
think we had talked about yellow corn versus white corn as an example.

MR. GRANT: The phraseology suggests an underlying framework. That
doesn\'t do it for me. It\'s much stronger than that.

MS. DILLEY: Mardi and then \--

DR. MELLON: I agree with Duane that it\'s a very important part of this
setting in the paper but I\'d like to make a plea for not eliminating
the discussion in the paragraph that describes where these are coming
from. We were talking about new markets that haven\'t existed before,
problems that surround these new sectors, and for us to kind of flush
over the fact that organic is a de facto label for non-GM food that in
fact the big food companies are interested in sourcing non-GE. They
really pay money for it. So, there are problems with regulation that
mean adventitious presence via the rice things we\'re dealing with right
now.

A lot of people are out there looking for ways, purchasing foods that
has a cost, that doesn\'t have GE in them. And to me that\'s what we
tried to include in this introductory material so I don\'t want to just
say there are, you know, kind of different sectors and they\'re doing
fine. I think it\'s really important that we at least have some
description of where they come from and I think what we have there is
okay. I mean, perhaps others would want to make it better.

The other, I am willing to go with, you know, that our organic sector is
perhaps one of the largest in the world if we don\'t want to, you know,
document the claim \-- if we can\'t document the claim that it\'s the
largest, but, I do think that \-- I mean I\'m just thinking for myself,
I was kind of really blown away by that fact last time when we discussed
it and it gave \-- as a fact it kind of gives meaning to there being a
flourishing organic sector.

Now, having heard what we just heard, finding out that, you know, we\'re
lucky to be ahead of Italy, I\'m not sure that that\'s a flourishing
organic sector and, you know, what we may want to do is make sure that
we, you know, not lose sight of the fact that there may be more barriers
in front of organic that haven\'t been well studied; that its ability to
coexist. I mean it\'s coexisting with three, you know, this hand tied
behind its back and that is a sense that I will be wanting to kind of
bring to the paper in a way that I actually didn\'t when I was, you
know, thinking that we were really up there.

MS. DILLEY: When you were talking, to me the first part of your comments
were going to kind of describe a little bit more the dynamic of evolving
marketplace with those three areas in mind and getting a little more
context to that. The last part of it seemed to me working, not working,
not so much an introduction piece but more \--

DR. MELLON: I agree with the last one. It\'s just kind of a way the
impact is having on my thinking to kind of go back and start talking
about, you know, what do we really mean when we say all three sectors
are first. As I said, I don\'t feel like that as much. I\'m not offering
any particular thing.

MS. DILLEY: Right. It takes away. But, what I don\'t want to do is start
to try to write the whole paper in the introduction but I think I
understand. I understand what you\'re saying in terms of giving that a
little more context of what do we mean by that they are coexisting right
now, what does that look like, the set up they\'re talking about,
working or not working.

Randy and then Nancy and then Russ.

MR. GIROUX: I just want to support what Alison said about including
something in the introduction about the scenarios of what is the
relative relationship between these industries because what struck me in
reading the two papers that were assigned to us that if you looked at
the \-- and if I read them correctly \-- the Commission or the drive for
regulation around coexistence, one of the premises of that was that the
premium paid and I think it read it more than once in here that the
premium paid, but when the politics took over and it worked out to what
the policy was, it was the new product, in this case GM or the novel
product would pay, how it would impact the larger commodity.

And, so, I think context counts so you\'re up where there was no GM and
you wanted to introduce the GM. It was the small player and that helps
drive the policy and how things work out here in the U.S. It\'s almost
reverse where the niche market that you\'re trying to grow is inside a
larger commodity market where the GM market in Europe is trying to grow
in what\'s called conventional markets.

So, I think that context does pay and my idea is you say the organic
industry is trying to flourish in the United States or with its hands
tied behind its back, not that I would suggest that there\'s probably
people who say the same thing about the biotechnology industry as it\'s
trying to coexist inside of Europe.

So, I believe the context is important so somewhere we should make sure
that we capture that as setting up the picture.

MS. DILLEY: Nancy and then Russ.

MS. BRYSON: I think it does help to have some context instead of having
it speak totally of qualitative in a sense and, so, having a fact that
this is what the acres are and then use that as a springboard to say or
identify with more clarity what issues there are to me seems to be
helpful at this stage and I think in response to Duane\'s point it is
more than a suggestion of the framework.

I think that what\'s happened today has happened because we have a
robust agricultural system in the United States and the kind of tools
that have been out there to differentiate between crops have been
brought to bear on this and, so, we might as a committee think that they
are the other tools and other things to happen, but, I think it is more
than a suggestion that a framework is beginning to evolve. I think the
framework was there and how it applies to this particular issue is
what\'s evolving.

MS. DILLEY: Russ and then Carol.

MR. KREMER: Yeah, I was just going to comment on the flourishing of
these sectors and also the comment that Duane had said something earlier
about, you know, we currently have coexistence and I think maybe it was
Nick who said that it is true that we had coexistence.

I guess I mentioned something earlier today about I think there\'s a
need as we talk about these sectors around the table there are barriers
in all of these sectors that I\'d like to see something in there that
states that, you know, hey, we have coexistence, but, you know, there\'s
a need to protect coexistence and enhance the ability of coexisting
because, you know, the way it states here, in my opinion, is everything
in honky-dory and we\'re coexisting and continue to coexist.

MS. DILLEY: Yeah, I think that this morning that we need to make some
affirmative statement about trying to foster coexistence. Is that what
you\'re looking for?

MR. KREMER: To better enhance it, enhance our ability to coexist.

MS. DILLEY: Carol?

MS. TUCKER FOREMAN: I agree and I like the thought, Randy\'s point about
the difference in the situation, who is the new kid on the block in the
U.S. versus the EU. It\'s context setting. And I don\'t object to
discussing the different percentages of crop land to conventional,
genetically engineered, and organic, but, I think to do that there\'s
got to be a reference to where the market for product is and the fact
that \-- and we\'re going to keep running into on this issue the
difference between feed grains and food.

And it might help if we\'re setting descriptive language here to say
there\'s a difference in them because the genetically engineered crops
are predominantly feed grains and the organic crops that we\'re talking
about have been most in terms of fruits and vegetables and part of the
problem we have in talking about this is that we all have a different
thing in front of our minds when we say organic and I thought the
presentation was very helpful in helping us tease that out so it might
be helpful to make that statement. It might take two sentences.

MS. DILLEY: Randy?

MR. GIROUX: I\'m a little \--

(Discussion off the record)

MR. GIROUX: One of the most interesting points that came out of what was
quite a good talk was the disconnect between consumer demand, organic,
and the growth of the industry, organic versus who is actually supplying
that demand and, so, when we talk about U.S. agriculture this may \--
the growth in U.S. agriculture and organic is probably only a percentage
then of what is the growth in the organic industry.

I don\'t understand. I don\'t understand how you can look at that.

MS. DILLEY: That\'s what I was wondering because if Wal-Mart announced
that they were doing that did that make a lot of people in China happy
or did that make a lot of people \--

MS. TUCKER FOREMAN: It makes a lot of people in Australia happy because
it\'s clear that\'s, you know, much of what they\'re going to sell that
got grown somewhere else. You\'ve got to wonder why is the market not
responding.

MS. DILLEY: That\'s a good question. That\'s part of the description.
You\'re looking for how to describe that a little bit more. Is there a
connect or disconnect or what does that look like.

MR. GIROUX: Right. So when we talk about growing the organic sector what
does that grow? Does it grow access for consumers to organic or does it
actually grow the organic sector of agriculture?

MS. DILLEY: Carol, Leon, Nick and then Sarah.

MS. GEISERT: Just a couple. I think we need some context. Is there some
data that we have reference to that kind of sets the stage so however we
choose to do it? But, I do think one of the things, and you listen to it
being on multiple ends, is that it all depends on what source of it is
indicated. If it\'s agriculture are you looking at it from the lens of
the producer? Are you looking at it through the lens of the buyer? Are
you looking at it from the lens of the manufacturer? And I think that
it\'s helpful. Are you looking at dairy, are you looking at meat, are
you looking at vegetables? They are very different and I think that was
one of the things that, you know, was discussed and to try to put it
into aggregate and make a general statement.

I like what Carol\'s saying. I think we\'re going to have to figure out
how we can rein in and talk about a sector or segment as a framework and
surrogate to say this is what we\'re discussing because every one of
them is very different and, you know, how we make our decisions is
dependent upon the global market that\'s out there and the nature of
what the source is in many capacities and so I think if you listen to
this it\'s every segment is your vantage point of looking at it.

Are we looking at wheat, are we looking at sugar beets, are we talking
about dairy? They\'re very different.

MS. DILLEY: Leon.

MR. CORZINE: I\'m not going to try to narrow this down at this point. I
think we\'ve got a real concern. Bowen mentioned it in part of what we
talked about as far as difference in labor. We got to be really careful.
It\'s interesting to know where we stack up in the world but it was
mentioned how in Europe where they really incentivize the organic
production. I mean they pile up a whole lot of extra money on there so
you get into economics and you get into those labor issues. There are a
lot of reasons besides me as a U.S. producer not growing organic or
having roadblocks when they can import from a country that already has
an unfair advantage so I express caution of that comparison and how we
differentiate on the U.S. agriculture on the production side and U.S.
agriculture on the consumer side and are we going to get in \-- I know
some of the states I\'ve been in there are some real serious issues.

Because I\'m really surprised that we put the U.S. organic label on
imported product because there\'s some real serious environmental issues
on products coming into the U.S. that are organically grown in some of
those other countries as well as the labor type issues and some of those
economic incentive issues that give unfair advantage and where we
address that I just expressed that we got to really take a hard look
when we\'re comparing U.S. agriculture to Europe and Latin America
because there\'s \-- you know \-- I don\'t know how broad we get here,
but, you know, those are real issues.

We\'ve already addressed the safety issues and environmental things of
bringing in organic products.

MR. KALAITZANDONAKES: So, there\'s a desire to summarize all this in a
coherent and brief way in the document like this, but, in my view this
seems to be very challenging. Can we have consensus on that? Because
those numbers are very difficult to describe. For example, we\'ve talked
a little bit about the unfair advantage and all of a sudden we sound
almost wary and that is kind of surprising to me for a couple of
reasons.

First of all, the rule of thumb is that organic agriculture is
competitive in the same countries where there is a competitive advantage
for the conventional production of that particular product, whatever it
is. So, for example, if the dairy industry, the conventional industry is
competitive in Australia, which it is globally, then typically there are
guides for production for that to be competitive at a global level. If
vegetable production, conventional vegetable production is competitive
in China, which it is, half of the major food processors in the world
buy their vegetables from China, their conventional vegetables, then
their organic vegetable production is in use.

So, the idea that it\'s only because of labor, or unfair labor use is
the source of competitive advantage, that\'s not fundamentally true. So,
if we are going to have some products that are going to be imported in
this market because they have a competitive advantage and that\'s life,
how we export to other markets. So, somehow to be wary of that reality
is really surprising to me so that\'s point number one.

Secondly, some rising data on various production systems that we are
talking about in making sense in a very brief way is going to be very,
very difficult and by that I mean maybe just people here by an example.
So, I mentioned that I think the United States and Europe is 15 and it
would be pretty singular in terms of, for example, retail sales, okay,
so, you know, in 2003 there was a billion dollar difference between the
two, the EU being higher, okay, but, most of that is, in fact, or their
composition is not higher in terms of animal agriculture, sheep, goats,
dairy, and so on so the land that they are going to be using is again
larger in terms of acreage and so forth. So, it depends on really we
wanted to use whether it's hectares and all of this can be interpreted
in a somewhat different way.

So, it\'s going to be very difficult to be precise and to be brief and
to be all inclusive. The bottom line in my view is that we do have both
large production over organic, large production of GM, large production
of conventional. We are the largest exporter of non-GM products in the
world. So, the question, do we want to illustrate and make sure that all
of it\'s not articulated precisely? It\'s not going to be brief, but, we
can do it.

MS. DILLEY: Yes.

DR. SCHECHTMAN: Just before, one more comment. I think that raises one
possible mechanism of shortening some of that which I guess is the
question for the purpose of talking about coexistence. To what extent
does this paper have to talk about animal agriculture? I mean, obviously
there are simply in terms of talking about vibrancy of the different
sectors, that\'s a different issue, but, in terms of talking about the
part of it that\'s relevant to this paper, what do people feel about the
need for having much discussion on that?

MS. DILLEY: I know your card is up in response to that but just go ahead
and then Nancy.

DR. CARDINEAU: Well, in line with many of the other comments that have
been made, Sarah\'s and Nick\'s probably the most closely, I\'m a
science guy and I like data. One of the problems we have is we\'re
looking at this and we\'re trying to lump everything in one basket.
It\'s very difficult to do that. When you look at GE agriculture it\'s
virtually all commodity crop or row crop. We don\'t have genetically
modified fruits and I hesitate to use the word vegetable because it\'s a
culinary term, but, I think you all understand that. It\'s not a botany
term.

But, the reality of life is other than papaya in Hawaii and some very
limited yellow squash, I don\'t even think there\'s much sweet corn any
more that\'s being produced that\'s genetically modified. So, if you\'re
looking at conventional agriculture you\'re covering everything. If
you\'re looking at GE you\'re talking about commodity crops or row
crops, and if you\'re talking about organic, other than some limited low
crop materials, you\'re principally talking about fruits and vegetables.

So, I think it would be interesting to say that all of these systems can
operate in the United States in coexistence. I mean, there is some
issues there, but, I think here versus lots of other places we do a
pretty good job about doing that. Now, if you want to try to divide up
the acreage maybe we need to look at what exactly is the acreage. I
don\'t think Australia and Argentina with grazing acreage really is
relevant to this discussion because that\'s not what we\'re talking
about here primarily, particularly if we\'re not going to cover animals.

So, I think we have to focus on the areas that we are directing our
attention at which really are row crops, commodity crops, fruits and
vegetables and divide up those areas and I think we can delineate those.
I\'m sure that data is out there. It doesn\'t belong in the introduction
though because it\'s never going to fit. Nick\'s right, we can do this.
But, you\'re not going to get it in three paragraphs.

MS. DILLEY: Okay.

(Discussion off the record)

MS. BRYSON: I was going to say it\'s hard to get data and I also like to
have data before I say anything or, you know, make a general statement
about it, but, it\'s hard to get data on which everybody agrees that\'s
verifiable so it\'s probably unrealistic in my view to think that we\'re
going to get a lot of data in this report. If we have a few general
statements which I tried to set the stage along the lines of what\'s
being planted here in the United States that seems to me to make a whole
lot of sense, but, I also think from the perspective of USDA what USDA
always wants to do is preserve every market it can for everybody\'s
responsibility of growth and it has a lot of interests in making sure
that small farmers have a way to have an economically viable existence.

So, these issues about whether in the process of looking at coexistence
there are things that can be done as part of that framework to enhance
the possibility that we could grow more organic stuff here in the United
States to satisfy our own market is something that\'s very important and
from USDA\'s perspective.

MS. DILLEY: Mardi.

DR. MELLON: I was just thinking this is quite an interesting way of
looking at the coexistence issues. It\'s quite an interesting way of
looking at the coexistence issues is to simply say that we\'re
coexisting because we don\'t grow fruits and vegetables that are GM.

We don\'t really have, except for papaya, we don\'t have an issue there.
We grow some corn perhaps, a little tiny bit of \-- I mean, I don\'t
know what percentage it might be of the sweet corn market, but, overall
it\'s got to be small, but, basically I mean I think we said that the
organic corn acreage was a tenth of a tenth of the overall corn acreage.
I mean, that suggests to me that if we were to kind of lay it out in
this kind of way it suggests to me that we could come up with some quite
innovative solutions.

It seems to me a very small tax on every corn farmer in the U.S. you
could pay off every potential claim that might ever come from an organic
farmer who wants to \-- you know \-- who actually suffered economic
crime in the marketplace. I mean, because it would be so small and that
would deal, you know, in an honorable way with kind of an unintended
effect and I\'m not really sure I can go there but I think the notion,
to me, \-- but still we have some interesting points that a lot of our
coexistence comes from, you know, simply not producing the different \--
not having a similar crops but being produced in the three different
systems and that\'s probably something we ought to keep in mind that
also of course says something about whether we\'re talking about today
and whether that situation exists or whether we\'re trying to set us up
for tomorrow when it might not.

But, it isn\'t just \-- and I think people would be surprised.

MR. FLOWERS: I\'m new to this committee and I\'m pretty simple and try
to come up with simple things. When I read this statement I thought we
were going to be talking about how do we in the farming community, you
know, I grow conventional crops, I grow biotech crops. There\'s not any
organic crops, but, how do we fit all this in together in our
communities and able to grow these different crops all at one place.

That\'s what I thought we were going to be talking about with all this.
It seems like that would be real simple. I don\'t know if that\'s what
our objective is but, you know, we\'re doing that. I mean, we talk to
neighbors. You know, if you grow next to my crop, you know, we work
together and that\'s what I kind of thought this was going to be all
about, so, it\'s kind of interesting to see how far \--

(Discussion off the record)

MS. DILLEY: It\'s really trying to get our hands around it so we may
just say coexisting \-- coexistence is happening and to the degree that
you want to flesh that out a little bit more I think that\'s what we\'re
wrestling with before you get into what you\'re talking about which is
what\'s working and what is not working and that\'s beyond the
introduction and starts getting into how do you divide it up. Do you do
it by crop, fruits, vegetables, however we organize that piece of it.

So, why don\'t we take a break before we get into public comments.
Alison, why don\'t we take your comment and we\'ll take a break.

DR. VAN EENENNAAM: I guess just with regards to this coexistence it\'s
working because the fruits don\'t have it and even the row crops have
organic but I that assumes we\'re talking only about GE, but, I mean,
we\'ve got coexistence of a lot of other conventional and organic
vegetables all over the place in California.

So, I guess one thing I would ask this committee, are we only addressing
coexistence issues at the time of genetic engineering here or are we
talking about coexistence in the broader sense of what enables
coexistence between, for example, are we talking organic and
conventional then that\'s not even what we\'re talking about and maybe
it\'s not, I don\'t know. That\'s what my question is. So, are we only
talking about GE issues are we talking about more general coexistence
issues?

MS. DILLEY: I\'m sure we\'ll pick this conversation back up after the
public comment period but we do need to break here shortly.

MR. KALAITZANDONAKES: Yeah, I think we are talking probably. We are
talking seed production which coexists with conventional. We are talking
about conventional production in GE and to me that\'s all part of it
because the practices are the same. The supply chain practices are the
same at the production level, at the procurement level, at the
transportation level, at the storage level, all the way down, so I
can\'t imagine we are talking only about GE.

DR. SCHECHTMAN: Yes. I\'ll just throw in one little comment. I mean, I
think the committee is charged with looking at a broad sense of this is
a committee about biotechnology so I think it is looking from the lens
of biotechnology but you can say that because these issues are, you
know, dealt with in the same sorts of ways that certainly I think is an
important conclusion, but, the committee does have the lens of starting
from the fact that it\'s a committee on biotechnology, which you are.

MS. DILLEY: Okay. So can we take a 10 minute break and come back at 3:30
for public comment and if there is anybody in the audience who plans to
provide public comment and you have not signed up yet.

(Whereupon, a brief recess was taken)

DR. SCHECHTMAN: We have allotted for the opportunity for the public to
provide comments to our discussion. I noted that on the sign-up sheet
outside \-- could we have quiet back in the room \-- I noted on the
sign-up sheet outside that there was nobody signed up at this point for
public comment. Do we have anyone who wishes to make public comment at
this point? Okay. Not seeing anything at this point we will check again
probably a bit after four to make sure that there are no public comments
at that point, but, as I said, we would find, as we always we do, ways
to use up the time so we\'ll continue our discussion at this point and
I\'ll turn it back over to Abby.

MS. DILLEY: Okay. Let me see if I can at least try and take a run at
some of what we\'ve talked about so far. In the introduction what I\'m
hearing is something like this and it doesn\'t necessarily happen in the
order of things, but, bear with me.

At least we know at the beginning the charge and I think we\'ve got
language around the charge that has been clarified and any other
definition that we\'ve worked in terms of coexistence for the purposes
of this paper refers to the concurrent cultivation of conventional,
organic, and genetically engineered crops consistent with underlying
consumer preferences and choices and then the next sentence talks about,
refers to the whole supply chain, and then I think just before the break
we talked about a lot of different things in terms of what do we really
mean coexistence is happening. Are we making a value judgment on this
because that\'s a real complex piece and so describing that perspective
is the complexity of what do we mean by coexistence is happening and
giving a little more context to that.

It\'s happening more or less successfully depending on where you sit and
what you\'re trying to do. We spiced that up a little bit in terms of
whether you\'re looking at cropland versus grazing land versus a new
product or you\'re trying to capture premium or you can look at through
a lot of different lenses. It\'s complex and you\'re going to look at
how the framework for coexistence, which is not new, but, it\'s evolving
to fit these three areas of production, whether it\'s working more or
less successfully.

And I think that\'s how the descriptive piece of some of the things
we\'re trying to get our arms around and whether we want to use
statistics and whether we want to look at the EU versus the U.S. or how
we put more around that is still in question, but, then I think we have
to move into whether the committee \-- why we\'re trying to struggle
with this.

And part of that, other in addition to responding to Secretary\'s
charge, is we\'re talking about it in terms of if we want to foster and
enhance coexistence. We think that the U.S. is a big producer of these
three areas is a good thing and that what we want to do is try and
understand and articulate what\'s happening out there to the degree that
we can maybe make some observations on how to encourage or foster
coexistence or enhance coexistence.

And the notion of the fact that it is dynamic and it is evolving there
are some things that we can say in terms of what\'s happening and not
happening that we can spotlight on and we can understand what\'s going
on and also to make some observations in terms of how could we encourage
or enhance and, to me, that\'s what we\'ve talked about so far. It\'s
not in text form, but, those are kind of dimensions of what I\'ve been
hearing so far as the introduction.

And then in terms of what the committee\'s trying to understand and
articulate from a body of different perceptions is what's working, not
working in terms of the framework evolving into these areas and into the
future for other agricultural production systems and go further than
that in saying that. Then that transitions into a more in-depth
discussions about what is working and not working which gets us past the
introduction and into more the body of the report in terms of what\'s
working and not working from these different perspectives and that\'s
what we have to kind of step to try and talk to how do we organize that
discussion of what\'s working and not working.

Does that make sense? Again, it\'s not perfect, it\'s in organic
perspective, but, to me, those are some of the major themes that came
out of the discussion until we took a break. Anything I missed, makes
sense, doesn\'t make sense? Okay. Then maybe we should call it a day.
Okay.

So, what I would suggest is that we move from the introduction. You need
a work plan how exactly to capture that, maybe you try to put that into
text and we\'ll figure that out, but, if that is kind of the general
themes of what you\'re hearing so far in the discussion I think it would
be helpful to spend more discussion on that, but, does this really tie
in to the relative part of the document of what\'s working, not working
piece and have that discussion.

We\'ll probably want to come back and refine maybe some things in the
introduction but I think if we can take another move into the next
segment I think it would be helpful. Do you people want to do that? I
don\'t know. I mean, comments? Okay. So, do you want to take a minute or
two to just look at?

We started with a number of things in terms of some things are working
and we have started out a list of some of those things in describing
that in a little more detail. Why don\'t we take a minute to look that
over and then as well just look at the whole part because some things
are working and some things are not working and some of these facts
there are some overlapping things in each of those lists that depending
on where you sit and who you are as described in the introduction we
think it\'s working or not working so look at those and we\'ll start the
conversation with what things are working.

MS. DILLEY: This section is trying to flesh out a little bit more
understanding capturing the committee\'s thinking on understanding and
articulating what is happening and what is working or not working on
that which is the next segment of the report. And you have six items in
the "some things are working." I think the numbering is a little off,
but, the structure and the success of private companies to test,
predictable introduction and use of products, the ecosystem, and FDA
labeling is another kind of big category under the section and the
structure piece of it has five sub-bullets. We can flesh that out a
little bit more.

So, just kind of a general reaction to trying to capture the picture of
understanding what is happening and working and why. Daryl, Guy, and
then Nick.

DR. BUSS: I guess I was going to back up just the headers because I
guess use of the headers that some things are working and some things
are not working, they are potentially in the future, I really like
Duane, what he suggested in the side bar, and I would put out the fact
that perhaps header A might be retitled as "factors enabling
coexistence" instead leading to a value judgment of what\'s a degree of
working and then it logically follows that B would play off that, you
know, "limitations of coexistence."

MS. DILLEY: Guy and then Nick and then Leon.

DR. CARDINEAU: Under number one under the factors enabling coexistence
the second bullet down, familiarity with identification preservation
systems are an efficient effect of production distribution of products,
I think that\'s true but only where there\'s a premium value to be found
in the product and I used StarLink as an example of that.

When you have number 2 yellow dent corn and there\'s no premium
associated with it, it\'s very hard to differentiate so if you have
white corn or high oil corn or some other rationale that pays for
identity preservation I think that\'s an accurate statement, but, it
seems to me to be inaccurate with regard to straight commodity crops.

Now, maybe some of my farmer growers will disagree with that, I don\'t
know, but, that would be my assessment on that. If there\'s no premium
there\'s no value in identity preservation.

MS. DILLEY: Nick?

MR. KALAITZANDONAKES: First, a comment on what Guy said. The statement
is supposed to say that because of the \--

MS. DILLEY: Could you speak up because you\'re speaking to Guy.

MR. KALAITZANDONAKES: So, the statement or that second bullet is
supposed to be indicating that because we already have a number of IP
systems in play that\'s a reality and that infrastructure for another IP
system to be facilitated. That\'s just purely, you know, knowledge and
experience and infrastructure. That\'s what it is.

Now, I wanted to in my own comment, I had participation in writing this
section, but, one of the factors that I think is missing from this
section as to factors that have enabled coexistence in the U.S. so far
and have made for the environment is this and I\'m not sure how to
articulate it so I\'m going to go around and around on this and
hopefully we can all help put it in words.

What we had had is an environment where everybody in the supply chain
has cooperated in making coexistence work, farmer to farmer, biotech
companies not bringing new traits until those traits were approved in
major markets, the grain merchandisers working with downstream partners
to enable all of this. So, that kind of environment of cooperation has
been a big factor of \-- a big contributing factor for having
coexistence working well.

I think an environment like this should not be taken for granted if
anything was not in place it could very easily make for much more
salient involvement. So I think it\'s important to articulate that that
kind of cooperation has existed in the past and has been an enabling
factor in facilitating the environment that we have had happen over all
this time.

MS. DILLEY: Okay. Leon and then Mardi.

MR. CORZINE: This farmer-to-farmer cooperation or cooperative spirit,
something like that, maybe farmer-to-farmer cooperation indication has
certainly assisted in the countryside to how coexistence is working and
we have volumes of examples of that. What I was going to do was go back
up to I noticed under number one, first in the very first sentence under
A I wonder if we should instead of non-GE we should say GE,
conventional, and organic. It makes more sense to me.

Also, under structure of the U.S. agriculture, in that first sentence I
know Margaret made the point as far as what countries, you know,
collectively set apart from other countries and I have a lot of caution
comparing us to other countries, so rather than that, I would strike
that and just put a period after the collectively says being a part. And
then the next sentence could say these characteristics have allowed the
U.S. to rapidly respond to.

MR. KALAITZANDONAKES: A lot of U.S. farmers?

MR. CORZINE: Well, it\'s more than just the farmers.

DR. SCHECHTMAN: Can I interject for just one sec. We\'re getting a lot
of static. Does anyone have their Blackberry or cell phone on because I
know people were chatting out in the hall. It may be next door but
nonetheless I just want to check to help out over here.

MR. CORZINE: Okay.

MS. DILLEY: To make sure, it sounds to me like you were trying to set up
that discussion about rather than trying to compare it to other
countries, maybe the collective agricultural system is set up
collectively to help enable coexistence to occur as opposed to I\'m not
sure the relative comparison to other countries.

MR. CORZINE: Right. I\'d just take that out because I think Margaret had
a good point there in her comment, but, and then rather than the
characteristics have allowed the U.S. or U.S. agriculture to actively
respond.

MS. DILLEY: Okay.

DR. BUSS: One response would be to merge that in one sentence and just
say the U.S. agricultural system.

MS. DILLEY: Yeah. You\'re soft-spoken.

DR. BUSS: The U.S. agricultural system has several characteristics that
allow farmers to rapidly respond to global market signals and just take
out the intervening piece.

DR. VAN EENENNAAM: Well, it would enable coexistence. What the factors
do is collectively is enable coexistence or something. They help
coexistence in some way and those characteristics have allowed them to
respond the way it was with coexistence in there, the first
modification, is what it is the characteristics are pertaining to.

MS. DILLEY: Mardi and then Carol. We\'ll work on that. Mardi.

DR. MELLON: I\'m not quite sure what to do about, but, I\'m a little
worried about the idea that the characteristics that we\'re talking
about are all kind of related to exports which are obviously a very
important part of U.S. agriculture under coexistence problems within the
U.S. and if we\'re all we\'re trying to do is provide coexistence in
terms of exports.

To respond to global market signals shifting their production.
Otherwise, it talks about \-- that to me puts it in an export context.

DR. SCHECHTMAN: Would it work to move that sentence after the bullet?

DR. MELLON: Maybe just remove global.

MS. TUCKER FOREMAN: Just take it out, global.

DR. MELLON: I mean, I just don\'t think we should restrict our sights to
that. My second point is I think we should, you know, make the point
about trying the farmer-to-farmer cooperation as an ongoing and
important element of response to this issue, but, and I think that that
response, you know, to all kind of three sets of interaction with
organic with a kind of non-GE market and GE.

But, I think that some of these, the cooperative efforts that were
described about companies not going ahead with products until approved
elsewhere, that really doesn\'t respond and that doesn\'t kind of
address the needs of the organic, non-organic, and GE interface. So we
just might want to be clear about which ones we\'re responding to.

And then although I hate to say this when Michael Dykes is not here to
fight back, I certainly take issue with the notion that products have
been proven to be equivalent to conventionally grown products in terms
of allergenicity and safety and wholesomeness. I don\'t think the FDA
would stand behind that statement and I\'m not sure \-- and I\'m sure it
wouldn\'t and I don\'t think that it adds much in this context. It\'s a
fight that we had before and don\'t want to have again.

MS. DILLEY: Carol and Duane and then Randy.

MS. TUCKER FOREMAN: Yeah. Actually, my original thought was exactly the
same as Mardi\'s about removing the word global and, but, we\'ve had
presentations about farmer-to-farmer cooperation and farmers here have
talked about it. I haven\'t seen any data on it and we\'ve been loathe
to use anecdotal to go forward only based on stories from the fields and
I\'d like to know if there are any data that quantifies how many farmers
are cooperating with other farmers?

MS. DILLEY: I don\'t know the answer to that. I thought. I thought
Nick\'s larger point was something of an example of. The bigger point to
me was it sure helps to encourage cooperation when you want to cooperate
I got and some examples of wanting to do that and actual activities that
have helped do that like farmer-to-farmer communication or grower
districts. It\'s some of the tools that are out there in terms of how
people have been collaborating. But, in terms of quantifying it, I
don\'t know the answer to that.

But, I may be off your point, Nick. It seems like attitude is a big
piece of it and examples of how that\'s manifested may be part of what
is not quite captured here.

MS. TUCKER FOREMAN: Farmers have been cited several times as the basic
given for why we have coexistence and I just don\'t have numbers.

MS. DILLEY: Duane, do you want to \--

MR. GRANT: I can speak to that a little bit. It\'s kind of where I was
headed although Leon\'s card went up as soon as I came up so you want to
hit it, Leon?

MR. CORZINE: I do, but, I don\'t know whether to go first or second. I
guess as far as numbers as far as writing the amount that we talk to one
another, but, I do think that there\'s \-- we\'ve had examples by each
of the presenters that, I mean, even that are growing both organic and
biotech and conventional crops. The data that shows that both areas are
growing probably wouldn\'t happen otherwise and we don\'t have
farmer-to-farmer lawsuit issues and each is able to meet his market
really speaks to that.

I don\'t know how you quantify unless you want to know how many times
I\'ve talked to my organic neighbor, you know.

MS. TUCKER FOREMAN: Nobody\'s collected any data on it. I think your
point would be \-- I don\'t know of a bunch of lawsuits so I think
that\'s probably at least one indicator. But, USDA\'s not collected any
sort of data on this?

MR. CORZINE: I\'m not sure how they \--

MS. DILLEY: I\'m not sure either.

MR. KALAITZANDONAKES: No, and there is no data like this but there is
some indicators that can mention it so there were other people here.

MS. DILLEY: Duane, go ahead, and then Randy.

MR. GRANT: I\'ll speak to that just a little bit because that\'s kind of
where I wanted to go. I wanted to follow up on Nick\'s point and work in
a response to Carol. I think there is a general atmosphere, to call it a
general atmosphere of cooperation within the ag community and I think
that is a bullet that we don\'t have and I wrote it out as a generally
accepted practice of direct producer involvement through association,
etc. and you can make that list as long as you want about associations,
commissions, boards, but, there\'s a general accepted practice of
producers becoming directly involved in coming up with practical
solutions to coexistence issues and that can be as all-encompassing as
the corn growers coming up with their "Know Before You Grow" program
which really is a coexistence issue.

The soybean guys have a very stringent protocol that has to be met
before they\'ll support new soybean varieties coming to market because
of the coexistence issues. So, that\'s kind of a large macro context, if
you will, and then, you know, you get right down to grower districts
that can be very small but, again, they have a tradition of direct
producer involvement. That\'s a real key issue of what works in our
system of what hasn\'t worked so well where the issue of coexistence has
become kind of a proxy for other larger battles.

So, I think if we can highlight that and say this is what works and
amplify that then this is probably the right place to do it, but, I
guess then back to your point, Carol, you know, I don\'t know of any
data out there other than just decades of direct involvement by
producers in helping to sit down around the table and craft solutions
that work, I guess. I don\'t know of where we come up with that data. I
don\'t know.

DR. SCHECHTMAN: This is sort of making an observation. Looking back for
at least some of the committee members who were on the previous advisory
committee that had a different name on biotechnology, the Advisory
Committee on Agricultural Biotechnology, and I think from comparing some
of the discussions about conflicts like coexistence then that we didn\'t
claim it that way but we had discussions around this issue to the
current discussions what I\'ve seen is sort of an evolving environment
of cooperation.

I think certainly there is more communications up and down the food
chain than there ever used to be and maybe, you know, these are
communication networks that are continuing to broaden and mature and I
don\'t know if you want to say there\'s a lot of it or a little of it,
but, I think I don\'t even know how you quantify it other than saying
anecdotally it seems like these kinds of communications are increased.

MR. GRANT: I disagree. I don\'t think they\'re increasing. I think
they\'ve been there. If it\'s been increasing it\'s because you\'re
looking now, all right, but, I mean, that\'s just \--

DR. SCHECHTMAN: That may be the farmer-to-farmer part, but, I think in
terms of having one end of the food chain to the other speaking to each
other my impression is that there has been more of that. Maybe other
people who are in the food chain rather than just an observer from the
outside could see if they agree with that or not.

MS. DILLEY: Randy is a representative of the food chain.

MR. GIROUX: I\'m not sure I\'m going to answer Michael\'s question, but,
go ahead, Jerry, in direct answer to his question.

MR. SLOCUM: I have a comment. Yeah, I do have an answer. I sense that
you\'re right because what biotechnology has done is it put the whole of
the supply chain more in a position of a corporate risk than they were
before. Years and years before there was biotechnology growers grew what
they could grow and we did it with the best production techniques we
could do and consumers bought from an array of products that growers
could grow.

All of a sudden with biotechnology there was another product that looked
the same, it tasted the same, it felt the same that growers could grow
and it was introduced in a way that consumers weren\'t fully aware of it
and it created an environment of uh oh, we got to explain this in a
hurry and all of a sudden it did foster a heightened need to communicate
from the consumer all the way back to the producer who supplied the
product and it started in \'95, \'96, and \'97 and it really got serious
in \'97 and \'98 and it really increased the communication up and down
the food chain to the point that, you know, Ron Olson is now the
Chairman of the American Grain and Feed and General Mills, a major grain
player, is not a major grain player like a Cargill or a ADM or a Bungee
or something like that, but, certainly within the grain handling
industry, I\'ve been a participant there for 30 years, I noticed a
heightened need to communicate up and down the chain and a heightened
sense of cooperation up and down the chain.

Now, how we quantify that, I\'m not exactly certain, but, it exists more
evidently in the United States than it does in the rest of the world.
The next point that there is a greater sense of cooperation now, you
know, from the field to the dinner plate in the United States than there
is in most places in the world.

MS. DILLEY: Randy and then Guy and Mardi.

MR. GIROUX: I\'m glad I let Jerry go first because I think what his
comments were were the comments that I want to talk about and just to
echo what Nick had said that there has been this sense of mutual
cooperation and what I would call an understanding around biotechnology
that the industries are interrelated and the stakeholders in the world
of biotechnology are interrelated in terms of the corporate risks, there
are regulatory risks, there are finished product risks.

So, what that does then and just to reiterate what Nick said, it does
put a level of corporate responsibility on individuals, members of that
supply chain to be acting in a way that disadvantage other members in
the supply chain. So, this is a core to core component. Now, that level
of cooperation has existed, but, while there is, I think, strong
communication throughout the supply chain individual action the other
stakeholders can interrupt that whole supply chain.

So, I think that\'s my key comment is that environment needs to exist
where all stakeholders are working together \-- not together, together
sounds too motherhood, but, understanding clearly that actions of
individual industries can impact stakeholders and if we don\'t do that,
if we don\'t acknowledge that, if that environment changes so does the
level of cooperation between the different sectors.

That was my first comment. I think my more important comment I started
with was that one of the things that\'s missing here in things that are
working is this issue of the specialty pays and because I don\'t like
the words that I\'ve used I\'ll refer to the text that was provided and
this was a comment made to me by Commissioner Fischler that said the
burden of coexistence measures \-- I\'ll just change this word \-- does
fall on the economic operators who intend to gain a benefit from the
specific cultivation model they have chosen. And that\'s a criteria that
exists today in all of our specialty programs, coexistence, whether they
be biotech or not that has to exist.

If that doesn\'t exist, if the commodity or the generic product has to
pay for the specialty product, this system doesn\'t work and I think
this is one of the growing pains that they\'re having in Europe where
coexistence would mean the commodity, the feed grain, which in our grain
would need to pay for the specialty which may in this case be a food
product.

Not to make a value judgment on GM, but, just the fact that food
doesn\'t command as much acreage as feed even in Europe.

MS. TUCKER FOREMAN: Would you repeat what you said in the beginning
because you were reading something from somewhere. I\'d like to have it.

MR. GIROUX: Yeah. It\'s right here in the documents that we\'ve been
given ahead of the meeting.

MS. DILLEY: The compilation.

MR. GIROUX: It\'s a quote from the Commissioner.

MS. DILLEY: Guy, Mardi, and then Nick.

DR. CARDINEAU: In response to Carol\'s comment about Dr. Dykes\'
editorial comment here and in line with Jerry\'s just stating it looks
the same, feels the same, tasted the same, I think I understood where
Dr. Dykes was trying to go with this. Suppose we take out are proven to
be and replace that with have been determined to be substantially
equivalent. Can we do that? Because that\'s what the coordinated
framework has said.

DR. MELLON: Substantial equivalent.

DR. SCHECHTMAN: Actually, we don\'t use substantial equivalent as an
endpoint.

DR. CARDINEAU: Okay. But, I don\'t think we can say approval because I
have to agree with Carol because that\'s too strong a language I think.
Maybe we can just take it all out.

MS. DILLEY: Okay. Mardi and then Nick and then Bowen.

DR. MELLON: I would like to state that I think on the use of anecdotal
data and the inability to kind of quantify something, with all respect
to Carol, I think we have to be willing to go ahead with the input of
the people on the committee and from the communities that are all here.
So, I\'m willing to go ahead with that with people saying what their
experience is and taking it seriously.

I would, however, say that an appropriate kind of balance for that for
me might be to make sure that in the barriers to coexistence section
that we have an anecdotal, not necessarily, you know, sociologically
determined, but, demonstration of how some organic farmers feel about
their inability to deal with their neighbors.

Now, in some cases it may work but not in all cases and they\'re faced
with, even in the best of all possible worlds, but, people don\'t always
live in the best of all possible worlds, so, there\'s some real
difficult decisions. So, including, and I\'ll have to think about it,
but, writing, you know, something like that to reflect kind of farmers,
particularly organic farmers in the second one would do \-- I think
would be appropriate because, as I said, a lot of things that have been
described here is working well, really are working well to accommodate
the needs of the non-GE and the conventional and GE farmers in the grain
trade and that is that, I mean, I agree with all the things that have
been said, but, that is only one part of the kind of world where we\'re
hoping for coexistence.

So, just to make it clear it\'s not quite working like that in this much
different kind of world where the organic folks are trying to get a toe
hold I think would be useful.

MS. DILLEY: Okay. Nick and then Bowen.

MR. KALAITZANDONAKES: So, I was going to provide two examples of farmer
cooperation and one is beginning to see the fruits, for example, we have
roughly 800,000 to a million acres a year of corn seed production and we
know that not a single one of them is without having all neighbors talk
to each other and documenting what each and every one of them produces
and have appropriate isolation differences.

Otherwise, your production is not certified. Absolutely.

DR. MELLON: Just a small point. Isolation distances are really not all
that important. Most of this can emanate and grain comes not from
cross-pollination, it comes from seed mixing. That\'s why you have so
much of it in soybeans which are not.

MR. KALAITZANDONAKES: This has nothing to do with GM or non-GM. Every
year, every seed producer has to certify what \-- they have to certify
to the certifier. The producers have to sit down and figure out what to
produce all around the field. So, this is one example of where
farmer-to-farmer cooperation is, year after year. So, this is one
example.

So, the second example which is documented is in non-GMO corn for starch
production and there are two or three systems that exist not only this
past year but for several years and we, again, which are proven, and
again there we have the farmer who is producing who is basically talking
to all the neighbors and, again, not only isolation distances but also
cooperating on what is being produced so that contamination doesn\'t
happen.

But, these are examples where we have documented year after year
farmer-to-farmer cooperation that I can quote and I\'m sure you guys
have producer networks that you might think that.

MS. DILLEY: Bowen.

MR. FLOWERS: I want to tell one more example. I don\'t know what kind of
documentation you\'re looking for but I was just wondering if, we had a
situation arise in a meeting of producer organizations in the area I\'m
from, the Mississippi Delta. We have the Delta Council. And we like to
get around and try visualize or fix the problems we\'re going to have,
get a solution before we have a problem. And this year there\'s an
abundance of wheat planted this year, conventional wheat.

And normally in the springtime we\'re burning down with glyphosate and
such which would destroy the wheat crop so we worry about this so we had
meetings this winter and in the early fall about, you know, potential
drift problems. We brought the different big industries together, that
sell the glyphosate, we had farmers come together. We decided to make
more restrictions on aerial applicators and also the ground uses, what
you\'re doing more carefully this spring so we wouldn\'t have a problem.

But, we\'re constantly working together to try to prevent problems.
We\'d rather regulate ourselves and watch out what we\'re doing than
having the government coming in and say, you know, mandate us to do
something so we\'re constantly working to try to find these problems and
come up with solutions and, you know, which constantly communicate
between the different organizations, the different crops, and that kind
of stuff to try to head off some of these problems.

So, there\'s a lot of communication. Now, what kind of documents? We
show you meetings, things like that. We have another organization in the
Mississippi Delta called Delta Farm where we\'re documenting how much
pesticide, herbicide we\'re using since genetically engineered crops
have come along so if that\'s the kind of stuff, we can get that kind of
information if that\'s what you\'re looking for.

MS. DILLEY: I think the main point and the way Jerry capped it made
sense in terms of tightening the need for more effective communication
to a broader group and getting some examples, several have been cited,
to kind of give some flavor to that and I would imagine we\'ll do the
same thing in the section, as Mardi has raised, in describing some
examples of where it hasn\'t been working so well.

So, \--

MR. KALAITZANDONAKES: There is one word that I came up with with a lot
of people in the supply chain are using.

MS. DILLEY: Yes.

MR. KALAITZANDONAKES: Call that stewardship and I don\'t know whether
that\'s more meaningful in this particular context.

MS. DILLEY: Yeah. The terminology of stewardship had a lot of comments
at the back of the document so let\'s table that. That has particular
meaning to different people and we do not have a common view of that
terminology among the group.

MS. TUCKER FOREMAN: I must say, Jerry\'s and Mardi\'s comments really I
think addressed my concerns because I think Jerry was realistic with
what is happening and how he described it and my concern which was
raised in part was I think people who are part of the dominant group are
often not aware of distress and experience of people who aren\'t and
there is a sense from the speakers and from the literature that there\'s
a group that feels like they\'re not being communicated with.

So I like the combination. Thank you.

MS. DILLEY: Right. Okay. Stephanie, your card down?

MS. WHALEN: The only thing I was just going to add another example.

MS. DILLEY: Okay. So now we\'ve kind of worked around the structure of
U.S. agriculture and some of the comments along those. I\'m not sure
we\'re on the edge of that number two in terms of the essence. It\'s
kind of interesting to define something that helps your neighbor by
saying the absence of something, but, I don\'t know if people have
additional comments on that particular piece or some of the other four
points that are under the some things that are working. Any additional?
Duane?

MR. GRANT: Just a comment on number two. It seems to be contradicted
later on in our document. I mean, I\'ll be honest, this is the first
time I\'ve heard the absence of an AP threshold described as an
advantage or something that\'s beneficial. I see the logic where this
was headed.

MS. DILLEY: The economists would say.

MR. GRANT: Yeah.

MR. KALAITZANDONAKES: I would say that if there is any single one
element that I would point this as a key to success is the lack of a
definitive number to struggle with and if there is any single point that
I would make about what has made the life of the European Union so
difficult is exactly trying to throw the coexistence issue around a
specific number and, so, I feel very strongly that not having a single
number is a key element to success.

MR. GRANT: Can I just respond? In one of our other documents we actually
say that we need an AP threshold and I think the issue really with
Europe is the fact that the threshold is a .9 and that\'s what the issue
is.

MS. DILLEY: Nick, go ahead.

MR. KALAITZANDONAKES: It\'s an arbitrary number and any time that you
use any arbitrary number whatever it is you run into issues like every
issue that the European Union has come up with so you choose your
arbitrary number. Obviously a five, that would be less difficult to deal
with than a .9 but it would be still an arbitrary number.

MS. DILLEY: Is that market defined at different levels and that\'s why
it makes as opposed to \--

MR. KALAITZANDONAKES: That\'s exactly how it works.

MS. DILLEY: It\'s market driven as opposed to regulatory. Regulatory
requirements here then.

MR. KALAITZANDONAKES: Exactly.

MR. CORZINE: I think that\'s right because we\'re also in two different
contexts and it\'s not as contradictory as you might think at first
because you\'re in the context of regulation and import of some of the
event versus \-- I think the point here is what\'s already been said.
The market sorts this out and there are different premiums or monetary
advantages to the various levels that you may meet and contractual
obligations to take care of those.

MS. DILLEY: Sarah and then Alison.

MS. GEISERT: I do think it\'s been an evolving learning though because I
think if you look back we would have set a number which served us all
well. Zero is a very small number and so we wanted something but I think
when it is arbitrary our learning has been that we can contend in a
global marketplace, the various markets have different requirements and
the same thing for something that deals with organic, traditional and
the spectrum is you make determinations for how you want to manage risk
for your company based on what you understand your consumers or what is
going on in the marketplace and I think, frankly, it has been an
evolving one.

If you had asked us a while back I think we would have told you one
number. I mean, now we\'re saying, you know, it works in our favor to
give us the flexibility to sort it through and to work it through in the
marketplace.

MS. DILLEY: Alison.

DR. VAN EENENNAAM: I guess I don\'t know, if you looked at the organic
with the 5 percent allowance for pesticide, if that wasn\'t in there,
would the de facto for that then be zero and they would be actually no
conventional and organic. I think that 5 percent has actually enabled
those two to coexist and by not having the number I think you get it
back to zero and by definition that eliminates one group. Zero is not
possible. And, so, having one number makes zero a possibility and I
think everyone will acknowledge that zero is not feasible.

MS. DILLEY: Brad and then Stephanie.

DR. SHURDUT: My one clarification is I\'m assuming that not having a
number is fine, but, you mean a non-zero number. I mean you don\'t want
this to fall to zero and so why do you want it to be arbitrary and you
want the market \-- you don\'t want the problem to be zero. I mean,
it\'s somewhat important to make that distinction and understand that
distinction.

MS. GEISERT: Well, personally, I think it\'s not that simple because I
think we do operate off of zero for unapproved events and other things
and, so, you know, there is some number above zero for approved events
depending on the market and there\'s a different set of criteria we
operate in on unapproved events and, so, I think like anything else
we\'ve had to deal with here depends on what your question is and how
broad you want the context to be.

DR. SHURDUT: You can just determine that absence of a known value to
define the threshold means zero. You can interpret that way and assuming
that the threshold is zero.

MS. DILLEY: Stephanie and then Randy.

MS. WHALEN: In response to the five percent number and the pesticides.
Is pesticides something different or are we dealing with compounds that
have, you know, ecological endpoints and the numbers are defined at
levels so there is a number developed through the whole process based on
the fact that you\'re putting something into the marketplace that has
been determined that in some animals to have some harmful effect.
That\'s not what we\'re dealing with. With these particulars it\'s
supposedly safe, they\'re determined, and so we\'re not dealing with
apples and oranges when you start talking about pesticide numbers with
this.

We\'re not dealing with the sameend points, say, when you start talking
about GE traits versus pesticides.

DR. VAN EENENNAAM: I just want to clarify that\'s the organic rule and
I\'m not talking about the allowed amount that\'s allowed in crops and
safety issues. It\'s just that the prohibitive thing in organic
agriculture but there\'s an allowance because of the acknowledgment in
reality pesticides just happen and if they made it zero, even though
they\'re not allowed to use it, you wouldn\'t be able to deal with any
agriculture in conventional agriculture and so that\'s why that\'s
written as a national organic rule.

MS. WHALEN: I Understand that.

DR. VAN EENENNAAM: Okay.

MS. WHALEN: I\'m saying there\'s a basis for that number, though, the 5
percent number basis, but, at least it\'s a number to put up for a
reason and there is not one for and there\'s a need for one for GE
traits.

MS. DILLEY: Randy and then Nick.

MR. GIROUX: Well, I\'m just thinking at this point and if you read the
sentence it talks about thresholds and labeling in the same comment and,
you know, so I believe in the U.S. today it\'s zero tolerance for
something that\'s not approved. So, when we\'re talking about thresholds
here I think it\'s this idea of voluntary labeling and being able to set
the thresholds for which your particular company is comfortable, what
that means in different industries and different companies have
different expectations for what they would want to label their non-GM
product voluntarily. As some may say, 5 percent\'s okay, some may say 1
percent\'s okay, some may say zero, what we expect, dependent upon what
they choose, what their philosophy as a company is, what their
expectations with their consumers is, so, I think the key is it\'s not a
standard value.

Because as soon as you standardize it you commoditize the market. I
mean, talking about things like non-GMO, you talk about organic. These
are marketing standards. These are not safety issues. Safety is off the
table. These are issues around markets and when you standardize, you
know, you know, us working guys, they\'re not big fans of standards
because it commoditizes what they\'re trying to clear in additional
value out of.

If you look at the organic standards, as soon as the organic standard
came out it was locally grown, it was buyer original, and you see that
the standard has actually created marketing distinctions within the
standard. So, I\'m not a big fan of standards particularly as they apply
to marketing issues and believe that\'s what the crafters of this were
looking at.

MS. DILLEY: Adrian?

DR. POLANSKY: Yeah. I agree with what I think I understand is the
consensus conversation here because we live in a dynamic world.
Consumers, producers, the processing, the food companies, things evolve
over time and in addition to what I think makes sense in terms of the
market will work these issues out during that time. Now, is it perfect?
No. Does it happen immediately? No. But, over time it has a way of
dealing with those issues and I frankly, as I am with some visit, in
hoping that the market will find a way to supply some of us consumers
that would like to have French fries that the potatoes haven\'t been
sprayed with pesticides and have some additional value traits there that
I would like to buy.

But, currently the market hasn\'t found a way to get that product to me.
So, you know, I\'ve got to be patient and so on, but, I suggest to those
who have marketing, there\'s 2-3 percent of us that would buy those. So,
there\'s a market there. But, nonetheless, I think the market is a whole
lot better at sorting these things out than some arbitrary kind of stamp
at one particular time.

MS. DILLEY: Duane.

MR. GRANT: So, I think we\'re mixing two different concepts here and
maybe I\'m just wrong, but, so, mandatory labeling, that\'s one concept.
I do think that\'s one of the reasons why this market has worked is
because we don\'t have mandatory labeling for transgenic products, but,
then the issue of AP, that has a lot of different connotations than just
whether or not something is labeled and I guess I\'m uncomfortable in
grouping those two together and I\'m especially uncomfortable in stating
here very clearly that the reason that we\'ve been able to coexist is
because we don\'t have an AP policy.

I just don\'t know that to be true. I\'ve never heard that brought up in
discussion. You know, we exist because we don\'t have an AP policy or we
can coexist. That just hasn\'t been one of the issues.

DR. SCHECHTMAN: Can I just make one comment that I think absence of a
numerical fixed number is not necessarily the same as absence of AP
policy. Whether or not we help define it, down the road which you\'ve
gone down before of saying that the government has no AP policy, that\'s
a separate issue, and the question about having a fixed number.

MR. GRANT: So is it possible to pull this concept of AP out of this and
still get at what the rest of the group seems to really like?

DR. VAN EENENNAAM: How about the ability of markets to develop numerical
thresholds or market-driven events?

MR. GRANT: That would be better. Actually, that concept is fine with me.
It\'s just this issue of AP has such a lot of baggage with it that I
don\'t think it really belongs there.

MS. DILLEY: Mardi.

DR. MELLON: I can\'t quite sort all this through but I think I agree
with Duane. I mean there\'s something about \-- I mean I think what we
have right now is just policy. Our current policy probably works in some
ways well enough and I think might assist in coexistence in between
non-GM and GM kind of marketplaces.

You know, the inability to say at some level that there are low levels
that are inevitable if you have \-- if you adopt these products at all
in your agriculture it\'s inevitable that there\'s going to be
contamination of the non-GE versions of those. The inability to say that
there is some level that\'s small enough not to worry about probably has
an impact on the likelihood that other crops will ever be approved.

I\'m not sure I can \-- I\'m not \-- you know \-- I feel like I\'m on
uncharted territory here, but, I do think that some point of that is
true. The way it is right now, letting the marketplace just work it out
with the small set of products that are there might be okay. Whether
that is actually a wise policy extending into the future, I\'m not sure.

MS. DILLEY: Nick.

MR. KALAITZANDONAKES: As far as I\'m concerned the U.S. has a very
explicit AP policy. It has an explicit AP policy for an approved event
which is zero. It has an explicit AP policy for organic which is
specified by the process that we have in the USDA standard. It has an
explicit policy on AP by not mandating labeling and therefore not
requiring specific thresholds for GM and conventional.

So, the point here is that the explicit policy is that there is no
market trigger and therefore it has to be market-driven, which has
worked out really well, which is what we have observed for the last ten
years. And, so, an explicit policy is not an accident and, so, I think
that\'s what this point is supposed to say.

DR. MELLON: If that\'s our policy why hasn\'t anybody ever said it?

MS. DILLEY: Why hasn\'t what?

DR. MELLON: Why hasn\'t it ever been articulated that we have a policy
and this is it?

MR. KALAITZANDONAKES: It has been articulated. It has been articulated.

DR. MELLON: I can\'t find a piece of paper that emanates from the USDA
that has the word adventitious presence in it, including the one that
supposedly is the basis of our adventitious presence policy. I mean,
I\'m learning and I\'m not even challenging your notion that that is our
de facto AP policy but it doesn\'t seem to me that it has been
articulated as our policy.

MS. DILLEY: It hasn\'t been an affirmative statement of saying this is
our policy.

DR. MELLON: This is it. And this, again, you don\'t tell and you hope
people don\'t ask. But, if that\'s it maybe we should say that the
department ought to articulate its policy as a way of facilitating
coexistence.

MS. DILLEY: For unapproved we have a policy; for unapproved it\'s in
terms of zero.

MR. KALAITZANDONAKES: For organics we have a policy.

MS. DILLEY: Right. For organics.

MR. KALAITZANDONAKES: For GM approved we have a policy which is we do
not require mandatory labeling and no explicit AP thresholds because
it\'s not meaningful.

MS. DILLEY: We need to piece that out a little bit more and say in the
absence because it\'s confusing and so rather than saying the absence of
it or that we have particular policies and then also it\'s market driven
in terms of the other.

DR. SCHECHTMAN: Right. Certainly the element about approach. I wouldn\'t
say it\'s a policy.

MS. DILLEY: It\'s a non-articulated policy.

MR. KALAITZANDONAKES: You know, you can say it however you want.

MS. DILLEY: Okay. So, we\'ll try and take a run at that and just restate
that. But, I think you\'re right. We\'ve all got a lot of different
things into that one paragraph. The one on the next page seems to be \--
I don\'t know if the ability of companies, I don\'t quite get that
unless it\'s really an example of trying to navigate different markets
or something that you have things like you \-- it has different points.

MS. GEISERT: If you listen to this conversation it doesn\'t really work
so why do we cooperate so much more because there are testings that
allow them to know, okay, this is what we intended we want, this is what
we bought, this is what we thought the consumers told us and it\'s in
the marketplace. I think that\'s the context that\'s forced us to work
closer together because we said, okay, let\'s join forces.

So, for me, that was the essence of the discussion whereas more so
policy because this don\'t ask, don\'t tell is tough to verify.

(Discussion off the record)

MS. DILLEY: So, okay, that\'s an entirely different to navigate the
markets, you have to have ways to verify.

DR. MELLON: The market couldn\'t work if you didn\'t have information.

MS. DILLEY: Right. It\'s information to support the market. I guess
that\'s better now. And then a regulatory system that allows new
products to be offered to the market in a relatively predictable manner.
Duane, is that one that you had a \--

MR. GRANT: Actually, this 3, 4, and 5, so, I spent a lot of time
thinking about and if they don\'t make sense we can toss them, but,
these were just \-- I mean, I thought the list was pretty sure of things
that were working and it seemed like there were more than that.

MS. GEISERT: I want to comment on this because I\'ve been struggling. I
think Duane\'s captured it here. I think is we talked about national and
global sourcing. You know, there is this innovation whether it\'s the
economy driven or whether it\'s market segment. To me, that\'s something
better here than what you\'re talking about. New products means new
markets and new market segmentations but I was kind of struggling where
it was, but, I think you\'ve captured it. That was my reading of it. I
thought it was a good definition.

MR. GRANT: Right.

MS. DILLEY: Alison?

DR. VAN EENENNAAM: Oh, the final sentence on the page before says that
we\'ve got this flexibility and we can do the things without extensive
testing and then our next bullet point is we rely on private companies
to test the level of genetically engineered materials. It doesn\'t seem
to follow very well after the point of not testing, the reason it works
is so we can test.

MR. GIROUX: We don\'t have to test. We don\'t have to test but you can.

MS. GEISERT: I think one of the struggles we run into with some of the
issues we\'ve seen recent in the market is that we don\'t have the
ability to test and in the absence of having mechanisms or tools to find
acceptable or unacceptable has challenged the market so when you have
these little dots we said.

MR. KALAITZANDONAKES: Does it make sense to broaden this and instead of
just testing talk about verification systems and so forth. Because
testing is one, but, organic we don\'t test with a dip stick, but, there
are verification systems that make the market work and so it\'s not just
about \--

DR. SCHECHTMAN: With appropriate verification systems instead of without
extensive testing.

MS. DILLEY: Other comments on this section?

MR. GIROUX: You mean A?

MS. DILLEY: I\'m just looking at A and we\'re going to call it a day
after A.

MR. GIROUX: So, I made the comment earlier and I\'m not sure we captured
it, but, number 6 bullet would be this issue of, coexistence measures
costs fall on the economic operator who intends to gain the benefit from
the cultivation.

MR. KALAITZANDONAKES: In a sense it makes sense but I mean having it
explicit might be useful but it\'s kind of implicit when we talk about
responding to market incentives, right, farmers who produce because
there\'s a market signal that says you may have a benefit from it.

But, your point \--

MR. GIROUX: The reason I make it explicit, Nick, is what we hear from
the organic community specifically on this is that this is fencing in
versus fencing out and do markets work around creating products, I want
to create a niche product, or, value added product, and the expectation
is should I pay or should everybody around me pay and I think that\'s a
seminal issue. I think that should be freshly stated here in the United
States and between these different sectors and so I think it deserves a
key point.

DR. MELLON: It is interestingly how it\'s said differently here than in
Europe.

MR. GRANT: Not just organic either but all segments the premium products
goes to the responsibility of.

MR. GIROUX: Because currently that\'s the way those markets work and if
we\'re talking about to go forward with something specific about
conventional, GM, and organic, those basic market rules which we\'ve
lived for for the last 100 years whether or not they don\'t apply in
this case and I think that\'s a key element that we need to get over
here.

MS. DILLEY: Mardi?

DR. MELLON: I actually agree in principle to start with, but, I think we
need to look at some of the examples of growers or what we call regions.
I mean, there are other solutions to some of these problems that have
evolved over the years other than just saying, you know, the premium
product pays. There\'s some acknowledgment that you have to \-- you know
\-- there are a number of different farmers in the neighborhood that
have changed, maximized, and everybody is a useful corollary to that and
is useful.

I would like to say that I\'m not quite sure what number 5 means but I
certainly would not want to be \-- you know \-- I\'m not comfortable
with kind of having our labeling policy which I think is fundamentally
wrong to be stated as the reason for our success of coexistence. Maybe
there\'s a number \--

MR. GRANT: We actually talked on labeling on the previous page so you
can drop 5 out and save ourselves a lot of time. It\'s discussed on the
previous page in another way.

MS. DILLEY: Anything else on this section in terms of what you need to
highlight as elements that are working or flushing that out a little bit
more?

DR. VAN EENENNAAM: I guess it\'s number 4, the bentgrass and alfalfa
scenario.

DR. SCHECHTMAN: What was it, Alison?

DR. VAN EENENNAAM: The label system to date allowed participants in all
marketplaces the ability to operate, given what we were told today.

DR. CARDINEAU: Actually it wasn\'t in the case. Remember, that just says
that the USDA has to do an environmental assessment. They don\'t admit
why and Stephanie can address that. There was a lawsuit filed in Hawaii
and essentially sort of ground, because Hawaii has a large number of
endangered species and endangered plant varieties and so a more
definitive environmental assessment was required. The court just said
that. They didn\'t say there was anything wrong with the genetically
engineered materials, but, it had to do better groundwork or lay a
better groundwork beforehand.

And I think that\'s what happened in the alfalfa case too. I don\'t
think it\'s out. It\'s just that we need to take a closer look at it.
You can correct me if I\'m wrong about that, Michael.

DR. SCHECHTMAN: I think that\'s right and you can correct me if I\'m
wrong. But, I would just say a comment about that as a procedural
statute so that it applies to the hard look that agencies need to take
before they take major federal action and \--

MS. BRYSON: It\'s also accurate to say we have a legal system to get a
point clarified if we go to court which is very beneficial.

DR. SCHECHTMAN: I think it\'s also the case that, you know, there could
be a decision that says there are going to be economic analyses produced
and one could determine that there are, indeed, going to be economic
impact and this is the case. When bridges are built, decisions are made,
and that nonetheless the decision is made to go ahead. So, the fact that
that procedural step is put in there doesn\'t necessarily preclude what
the decisions are.

MS. DILLEY: Stephanie?

MS. WHALEN: My understanding of the Hawaii case was basically that it
was like there were procedural things that the agencies did it but they
didn\'t document it. So, the fact that it wasn\'t necessarily found,
but, I don\'t know if that was clearly defined but at least it wasn\'t
documented.

MS. DILLEY: All right. So, that first half of it is, I\'m sure, is the
last half, the section that has a good start in looking at what is
working and trying to get on the same page as to what these separate
bullets mean. Tomorrow we\'ll pick up the conversation.

When we start actually tomorrow with the presentation by Phil Lempert
and then we\'ll pick up the second half of the document after that.
We\'ll try and capture some of the things that we went over today just
in bullet points. We won\'t have time to integrate it into the document
completely but I think we have some place holders to advance the session
from where and what we\'ve talked about today and then move forward with
that and the next iteration of the document of the paper and then pick
up tomorrow on some things that are not working and do the same, do that
as well.

So, any questions? Otherwise, we\'ll adjourn ten minutes early because
the energy level is starting to \-- and we\'ll start fresh tomorrow at
8:30.

(Whereupon, at 4:51 p.m., the meeting was adjourned).

[]{.underline} Digitally signed by Beverly Jason

[ELECTRONIC CERTIFICATE]{.underline}

DEPOSITION SERVICES, INC., hereby certifies that the attached pages
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the proceedings before the

United States Department of Agriculture:

ADVISORY COMMITTEE ON BIOTECHNOLOGY

AND 21ST CENTURY AGRICULTURE

By:

![](media/image1.png){width="3.0458333333333334in"
height="0.8909722222222223in"}

Beverly Jason, Transcriber