But clearly the lost markets for U.S. corn are due to consumers’ refusal to buy GE food products, and not the moratorium. In fact, before the European moratorium was enacted in late 1998, U.S. corn sales to Europe had already dropped by 90%, from over $400 million in 1995 to $35 million in 1998. Other GE foods from the U.S. that were approved prior to the moratorium were also effectively barred from Europe due to consumer preferences for non-GE food. GE soybeans were unaffected by the moratorium, since GE soy was approved for import to Europe in 1996. Yet European imports of U.S. soy dropped from 9.8 million tons in 1995 to 3.6 million tons in 2004.

Consumers around the world, not only in Europe, prefer non-GE food. China has been looking outside the U.S. for non-GE soy, leading to $200 million in lost U.S. exports there . The U.S. has lost much of its corn sales to South Korea, once the number two customer for U.S. corn, as that country has been going elsewhere for non-GE corn. But the U.S. has not challenged China or South Korea at the WTO.

The biotech industry seems more realistic than the Administration about the cause of lost markets for U.S. grain, noting that "Whether [GE] foods will be accepted or not will depend on the European consumers. We understand and accept this." Since food companies know that consumers will use labels to avoid GE products, most simply avoid labeling by eliminating GE ingredients from their products. American companies like Coca-Cola, Kraft, PespiCo and others have stopped using GE ingredients in their products sold in Europe, China, and other major markets . This market reality has prompted the biotech industry to make the remarkable argument that by requiring labeling of GE food, governments are denying consumer choice, since labeling often means no GE products are sold. Immediately after Europe’s labeling and traceability laws were published in 2003, the biotechnology and food industries urged the Bush Administration to challenge the new rules at the < WTO. One industry representative noted the insignificance of the U.S. case against Europe’s moratorium, stating that “removal of the moratorium is ‘utterly useless ’if it is replaced by labeling and traceability rules.”

In previous U.S. WTO challenges of European food regulations, U.S. “victory” has proven less than clear-cut. Europe’s ban on imports of U.S. beef, due to artificial hormones used in beef production here, prompted a U.S. WTO challenge in 1996. The WTO ruled in favor of the U.S. in 1999, but Europe refused to allow imports, and instead developed a more thorough regulation that went into effect in 2002. The new E.U. rule established a permanent prohibition of one hormone and imposed a provisional ban on five others, effectively keeping U.S. beef out of Europe. The E.U. insisted that their actions satisfied the U.S. complaint, but the U.S. refused to lift $116 million in retaliatory tariffs on European goods. In November 2004, Europe brought a case against the U.S. to the WTO challenging the legality of the continuing tariffs.