By Dominique Patton

BEIJING, (Reuters) –China’s proposed rules change will allow seed producers to obtain approval to grow genetically modified crops. This should enable them to produce GM corn for commercial use.

The draft document, which is available for public comments until December 12, contained details of the proposed regulatory reform for the seed industry.

These proposed modifications could mean that a few recently approved GM traits created by Chinese companies may be available for market launch within a year.

Liu Shi, a vice-president of Beijing Dabeinong Technology Group Co Ltd said, “It is a great step.” He also stated that the company, which already has several GM trait approvals as safe, will likely be among the first companies to sell GM corn in China.

Shares of Dabeinong dropped 6% while Longping High-Tech Agriculture Co Ltd was down 10%

China’s leaders called for an urgent turnaround in the seed sector last year. The industry is suffering from overcapacity, rampant intellectual property infringement that has hindered innovation.

According to the statement of ministry of agriculture, rural affairs, these changes are implemented by the central committee of communist party and cabinet on the safe management and development of GMOs.

High-ranking policymakers also urged biotech breeding or GM crops to be developed, as this is crucial for food security.

Despite having invested heavily over the years in GM research, Beijing has remained prudent and barred any planting of GM soybeans, corn or other crops, despite allowing imported feed for animal use.

China could grow 33 million hectares of GM crops once they have been approved. Hua’an Securities stated this Sunday in a note. The country can generate income up to five billion yuan and also create market leaders, consolidate the industry, and produce strong market leaders.

These proposed modifications would align China’s regulations with other markets.

A GM trait is also called an ‘event’ and can be integrated into a previously approved corn hybrid. It only takes a year of production to prove that it’s still safe.

China was believed to have previously required that the product undergo all safety testing from scratch.

Han Gengchen (chairman of Origin Agritech Ltd), the first Chinese company that developed GM corn, said, “It clarifies and simplifies the processes for GMO variety approvals.”

It will “accelerate GMO corn commercial production.”

The date of approval for the first commercial crop is not yet known.

Liu said that Dabeinong is now ready to begin production trials for DBN9936, an insect-resistant, herbicide-tolerant, corn. Liu also stated that Dabeinong has been “bulking up” inbred lines so it can produce sufficient parent seeds to be ready for commercial sale.

If all production trials have been completed and approved by 2022 then Dabeinong can begin commercial sales on a small scale in the spring of 2023.

Liu stated that Beijing may not recognize field demonstrations by Dabeinong in the past and grant approval for them earlier.

Hangzhou Ruifeng Biotech Co Ltd (in which Yuan Longping holds a 41.8% share) also offers an insect-resistant and herbicide-tolerant GM Event that has been approved by China.