Putting a toe in the GM pool

By LIAM DANN primary industries editor


To modify or not to modify? That is the question facing Fonterra as it juggles consumer expectations with pressure to stay ahead of competitors scientifically.

Fonterra has no intention at this stage of marketing genetically modified products, says director of marketing and innovation Bob Major.

He is charged with charting Fonterra's course through the political and commercial minefield of genetic research.

But while Fonterra is driven by the market, he says the company cannot ignore the potential of genetic modification.

In five to 10 years GM food is likely to be a reality in many Fonterra markets, says Major.

"It's our responsibility to ensure we're up with the play with those technologies and at least know what we can do.

"Certainly all our competitors are doing it."

Gene research accounts for just 1 per cent of the budget at Fonterra's innovation centre in Palmerston North.

The company spends much more on its organic operations, Major says.

Most of that gene research does not involve any genetic modification.

Fonterra has just one project involving transgenic experiments and there are no plans for field trials.

That work involves taking DNA from fruit and putting it into bacteria.

"It's not to do with fruit characteristics. It's to do with what that enzyme might do to milk or cheese."

New Zealand's grass-fed cows produce a flavour of cheese that is not popular with Japanese and Korean consumers.

They see our cheese as inferior to the European product, which gets its flavour from grain-fed cows.

To deal with that problem Fonterra has developed a cheese called Taupo, which is selling well in Japan. A cultured bacteria is used to alter the flavour.

"That particular bacteria, when you grow it in the milk, produces enzymes which alter the flavour of the cheese so there is less Oceanic [grass-fed] flavour," Major says.

"That's been quite successful but it's quite an expensive way to do it. So we're looking for efficient, less-expensive ways to do that."

The work involves taking genes from some bacteria and putting them in other bacteria to see what enzymes they produce.

"We collect the enzymes and use those in the cheese manufacture to see what that does to the nature of the final cheese."

Major accepts that the Japanese are still very sensitive to GM foods.

In part, Fonterra is doing the "blue-skies research" now, he says.

"If the market doesn't accept it we have still built up a lot of knowledge around what enzyme does what to what particular milk.

"In that case you don't actually use the modified genes in the milk but it is a research tool that has enabled you to find what you're looking for."

Much of Fonterra's gene research is based around the hunt for medically beneficial proteins.

Subsidiary firm Vialactia - which has been targeted by the protest group Mothers Against Genetic Engineering - is not modifying genes.

Major says it trawls through databases of cows to find traits such as fat and protein content, then identify related genes and investigate the milk from that group.

Once cows with the right genes are identified, researchers can breed positive traits into the herd without any genetic modification.

Identifying genes associated with beneficial proteins offers huge financial rewards, Major says.

Lactoferrin boosts the immune system and acepeptides may be beneficial in heart disease.

A probiotic bacteria enhances gut health and immune response. "We already sell two strains," Major says. "We're looking at exactly what genes in those particular bacteria provide the health benefits."

The biggest single example of the value of being first on the market with new science is a high-calcium milk powder called Anlene, now the second-most-valuable brand Fonterra has (the leader is Anchor).

Despite the fact that every other dairy company now has its own high-calcium powder, Anlene remains the leading brand, he says.

Outside the labs Fonterra has other big choices to make about GM.

New Zealand genetics company Ambreed plans to start selling semen from cloned bulls.

They will have to export their product. Major says Fonterra is not interested.

Another concern is the release of GM grasses. Fonterra will not buy milk from cows fed on such pastures.

"The way in which a scientist would look at is that a cow that is eating genetically modified grass produces milk which itself has none of the modified DNA," Major says. "So it's really GM-free milk, but that's not exactly the way the consumer looks at it."