2001: A Rice Oddity - or Why Grain Crop Improvements Go Unshared

WHILE posing as the socialist champion of the third world, China has joined capitalists in denying other hungry countries the secret behind the world's most fruitful rice. In return for some $1.2 million, Beijing is helping two United States companies to monopolize the prolific rice by withholding the seed from foreign paddies until 2001.

If the hybrid were to replace conventional rice in one-third of the world's paddy acreage, it would feed an additional 100 million people, says Yuan Longping, the scientist who developed the high-yield grain.

``I'd like to teach people how to develop hybrid rice but the government won't let me,'' says Mr. Yuan, who is the director of the Hunan Hybrid Rice Research Center.

The curb on China's unrivaled know-how has delayed by many years the effort by third-world countries to use hybrid rice to combat hunger among their burgeoning populations, says Sant Virmani of the International Rice Research Institute (IRRI) in Los Banos, Philippines. The hybrids produce up to 30 percent more grain than do common rice varieties.

The restriction on the rice was initiated by Armand Hammer, one of the communist world's favorite capitalists and chairman of Occidental Petroleum Corporation, says Li Meisen, chief of the Agricultural Ministry's Seed Division. Mr. Hammer won the favor of Vladimir Lenin in the 1920s and made a fortune by trading with the Soviet Union. He has maintained lucrative ties with communist leaders ever since.

Occidental signed a 20-year contract for rights to the hybrid rice in 10 countries in March 1980. The company agreed to give the China National Seed Corporation an initial fee of $200,000, payment of $50,000 per year, and 5 percent of profits from sales of hybrid seeds, Yuan says.

Through its subsidiary, Ring Around Research, Occidental plans to begin marketing the rice in the United States by 1993. The company aims to cash in on the dependence of farmers for hybrid seeds; the high-yielding rice can't regenerate itself and so seeds must be purchased every year.

But Occidental has yet to release the hybrid seeds to developing countries struggling to feed their surging populations. Officials at Occidental declined to comment on the topic. Cargill Inc., the other US company with a hold on the hybrid grain, said only that it is now renegotiating a contract it signed in 1981 for rights to the rice in five countries.

Beijing has realized that it is putting moneymaking before the moral imperative of fighting hunger and so has sought to renegotiate the contracts, Mr. Li says.

``Personally, if I were asked to sign such an agreement again, I wouldn't do it,'' he says.

China signed the contract with Occidental because Hammer is an ``old friend'' of China and is well acquainted with the leadership, Li says. Hammer routinely meets with his contemporary, senior-leader Deng Xiaoping, during visits to China. Through Occidental, he has invested $200 million in a coal mine at Antaibao, the largest Sino-US joint venture.

The Beijing government overlooked the implications of the 1980 contract because of its inexperience in dealing with foreign executives and eagerness to ``open up'' after years of self-imposed isolation, Li says.

``The contracts are unfortunate ... it's an accident that has happened and we're trying to recover from it,'' says Dr. Virmani, IRRI's chief rice breeder.

Ironically, the US companies are unlikely to make a quick killing in overseas seed sales. Few countries will want to rely on a foreign company for something as critical as rice seed, say agronomists. IRRI, which freely exchanges its research, plans to break the companies' monopoly by introducing hybrid rice on a large scale within three to five years, Virmani says.

The hybrid of rice subspecies under development by Yuan and scheduled for release in China in 1993 would outproduce existing hybrids. It would not be subject to the contracts and so could be distributed freely, unless Beijing restricts it to satisfy the US companies.