ASR Group, the world's largest sugar refiner, has agreed to a 10-year deal to buy millions of tonnes of non-genetically modified (GMO-free) raw cane sugar from Brazil's Raizen, according to both companies.
It is reported by Nasdaq.
This is the world's first large-scale deal for GMO-free raw sugar and it comes as several sugar producers in Brazil are starting planting of genetically modified (GMO) sugarcane varieties, seeking to reduce production costs.
U.S.-based ASR Group agreed to buy 1.2 million tonnes of certified GMO-free raw sugar from Raizen for the next 10 years.
The companies said the full product cycle would be segregated, from planting to processing and transportation, including at the sugar terminal at Paranagua port and aboard ships.
Financial details were not disclosed, but the companies said there was a premium over market prices for raw sugar to cover costs associated with the system.
«GMO-free food is a big issue in Europe, the United States, and we came to the conclusion that we needed a large volume of sustainable, GMO-free cane sugar»,— Alan Wood, ASR group vice-president for global sugars, told Reuters.
«This deal puts us in a good position to meet this increasing demand from consumers, including food and beverage industries», — said Wood, whose company sells popular sugar brands such as Tate & Lyle in Britain and Domino in the U.S.
GMOs have spread beyond soybeans and corn recently as producers have tried to lower costs and use varieties more resistant to insects and harsh climate.
Genetically modified sugarcane is said by developers to be more productive, but there is resistance from consumers, as is the case with GMO wheat.
«This partnership marks a new chapter in global sugar traceability», — said Paulo Neves, vice president of trading at Raizen.
Neves said the deal did not mean the Brazilian company would not adopt GMO cane in some of its farms if it saw efficiency in doing so, but he added that the firm wanted to meet different needs from clients.