AUSTRIA BANS USE OF GLYPHOSATE, FIRST COUNTRY TO DO SO
Jul. 3, 2019
Dow Jones reports:
BERLIN -- Austrian lawmakers Tuesday banned the key chemical in Roundup -- a first in Europe and a fresh blow to Bayer AG, which has lost several lawsuits in the U.S. alleging that the potent herbicide causes cancer.
The German chemicals and pharmaceuticals company completed the acquisition of Roundup inventor Monsanto Co. last year, but saw its share price plummet after a jury ruled against it for the first time. Thousands of cancer patients have since filed similar suits seeking damages.
Lawmakers in Austria were voting on a proposal by the opposition Social Democratic Party to ban use of the chemical glyphosate, the world's most widely used herbicide, which Bayer insists doesn't cause cancer if used as indicated.
"We want to be a role model for other countries in the EU and the world, " said Erwin Preiner, a member of the Austrian parliament for the Social Democrats who worked on the proposed ban.
Bayer is currently facing lawsuits from over 13,000 plaintiffs alleging that Roundup gave them cancer. While the Austrian decision has no direct bearing on the suits and the country is a negligibly small market for Roundup, the ban could complicate Bayer's public efforts to defend the use of the product as safe and environmentally friendly.
Bayer has argued that regulators around the world, including the U.S. Environmental Protection Agency and the European Chemicals Agency, have declared glyphosate to be safe and not carcinogenic.
But the chemical has faced growing skepticism since a 2015 decision by the International Agency for Research on Cancer, a World Health Organization unit, classifying it as likely having the potential to cause cancer in humans.
Other countries outside of Europe have adopted total and partial glyphosate bans in the past, such as Colombia and El Salvador. Sri Lanka in 2015 was the first country to issue a national ban, but it later revoked the law because the country's tea exports plummeted.
The vote in Austria came despite glyphosate having been cleared for sale and use in the entire European Union until 2022, which some critics say could make any national ban illegal under EU law.
A report commissioned by Austria's Ministry for Sustainability and Tourism published Monday concluded that a total ban didn't conform to EU law. The sponsors of the bill reject this argument, pointing to examples of other member states banning specific compounds. The European Commission has three months to object the Austrian measure, according to a Commission spokeswoman.
Bayer said the Austrian parliament's decision was contrary to scientific findings on glyphosate, ignored the safety assessment of Austria's food-safety authority and the existing EU-wide license of the chemical.
"We expect the European Commission to review this decision critically, as it may be inconsistent with mandatory legal and procedural requirements and scientific reasoning," said a spokesman for Bayer's crop science unit.
A ban in the small Alpine republic where use of glyphosate-based herbicides amounts to a few hundred tons a year, would have close to no direct impact on Roundup sales, analysts say.
Annual sales of glyphosate herbicides, including by competitors, totaled around $5 billion in 2016, according to Sanford C. Bernstein. The bulk of that is generated in the U.S. and South America, where Bayer relies heavily on selling seeds genetically engineered to resist glyphosate.
But Austria's move highlights the growing popular and political backlash against the chemical in Bayer's own European backyard, where protecting the environment is rising up the list of voters' concerns.
President Emmanuel Macron of France, the EU's largest grain producer, has pledged to gradually phase out glyphosate and wants to make French vineyards the first glyphosate-free vineyards of the world. Earlier this year, a French court also banned one form of Roundup.
In Germany, Environment Minister Svenja Schulze has proposed a plan for a gradual phasing out of glyphosate. Public railway operator Deutsche Bahn AG, the country's largest user of glyphosate, said it was setting up a research project to find alternatives to combat weeds along its 33,000 kilometers of tracks.
"We will come to a point where glyphosate isn't used anymore," German Chancellor Angela Merkel told the lower house of parliament last week.
All of this could make it harder for the chemical to see its EU clearance renewed in 2022. In 2017, the bloc would likely have banned glyphosate without a last-minute change of tack by Germany, which threw its weight behind the chemical, tilting the balance of the vote. The surprise move prompted grass-roots protests that forced the EU to make the process for authorizing pesticides more transparent.
"People have learned a lot about how pesticides are regulated so the process will be highly scrutinized," said Nina Holland, a researcher with Corporate Europe Observatory, a Brussels-based think tank that has been fighting glyphosate for years.