A lobby critical of genetically engineered organisms being used in foods and the environment says production of GE pharmaceuticals and functional foods in milk could threaten dairy exports.
GE Free NZ said today that plans by the biggest state science company, Agresearch, to produce GE milk and other high-value proteins in farming areas such as Waikato, Taranaki, Canterbury and Southland posed a commercial risk for dairy exporter Fonterra.
"This is a decision that goes to the heart of New Zealand's values and international positioning," said GE-Free spokesman, Jon Carapiet.
"It will change the very nature of this country, not just in the short-term but forever."
Biopharming - production of pharmaceutical compounds in plant and livestock tissue - has been talked up as the next major development in both farming and pharmaceutical production.
Agresearch is looking at using buffalo, sheep, pigs, alpacas, goats, horses and cows as "production platforms" and has made four applications for the laboratory testing of human and monkey cell lines and smaller species of GE laboratory animals to develop the production herds.
Agresearch has previously created experimental transgenic cattle lines - including one containing a copy of a human gene. It is now seeking approval to exploit its expertise and the nation's low burden of animal illnesses such as madcow disease and develop commercial applications of transgenic livestock.
The GE animals could be used to produce antigens, biopharmaceuticals, enzymes, hormones and other products with possible health benefits and commercial applications.
Fonterra has carried out its own GE research, particularly in relation ot potential pasture plants, but has said it does not want GE products until they are accepted by its customers. It has not taken up an experimental GE cow bred by Agresearch to produce milk with more casein for cheese-making.
Carapiet said it would make economic sense for Fonterra to oppose the applications as a threat to the cooperative's standing as a food exporter.
A preliminary economic evaluation of biopharming in New Zealand by Lincoln University showed GE organisms in the dairy sector had a theoretical potential to cause a minimum of $539 million in losses to the dairy and tourism industries, said Carapiet.
Agresearch's plans represented a transformation of the agricultural sector that Fonterra should not embrace, he said.
The Lincoln report signalled that exporters such as Fonterra and "Brand New Zealand" could be stigmatised if some future GE food turned out to hurt consumers.
Carpiet said there was an alarming lack of lack of basic information, and definitive information on the economics of biopharming was scant: "Biopharming is still in a research stage."
The report said that biopharming could contribute to economic growth, but might also risk negative reactions if a specific technolgoy was not accepted by consumers.
It considered two potential products: recombinant human lactoferrin (rhLF) produced in cow's milk and potatoes engineer to rate low on a glycemic index (GI) , which measures the speed at which food sugars enter the bloodstream, and important aspect for diabetics.
There was a lack of some necessary business information for analysis of recombinant human lactoferrin (rhLF) produced in cow's milk, but it would be difficult to earn more than a normal profit because there seemed to be several close substitutes and competing technologies.
Worldwide sales of lactoferrin were measured in terms of tens of millions of dollars, so a GE version seemed unlikely in the medium term to offset the risk of hundreds of millions of dollars in lost exports.
"By contrast, the low-GI potato could have clear consumer appeal," the report said. A "functional food" would have lower regulatory hurdles than a biopharmaceutical, and potatoes are a commonly consumed food in a multi-billion dollar market.
The genetically engineered status of the product could create problems in some markets, and there was a risk of losing at least $NZ191 million in annual tourism earnings. The food, agricultural and tourism sectors in New Zealand contribute around 27 percent of gross domestic product, with a heavy focus on exports.
