Theft in the fields

August 10, 2023 | Jeff Hutton

More than a decade ago in Dysart, a farmer spotted a man, Mo Hailong, digging up hybrid corn seeds. Hailong then sent the seeds back to China. The FBI later arrested him and others after they were charged with stealing approximately $30 million worth of U.S. ag technology. Other cases followed, including Xiang Haitao, who stole technical ag information from his employer, a Monsanto subsidiary. He was stopped at Chicago’s O’Hare Airport, where the FBI discovered an SD card in his possession, which contained the information.

“This is about protecting the fruits of your labor,” said Committee Chairman Rep. Mike Gallagher (R-Wis.) during a recent Congressional Select Committee on the Chinese Communist Party (CCP) at Youngblut Ag in Dysart.

But why is the CCP after U.S. seeds and ag technology?

“I believe this is part of a much larger plan to steal intellectual property - a countrywide heist of American intellectual property,” says Gallagher, who noted that $225 billion to $600 billion worth of trade secrets and intellectual property are stolen every year by global competitors with China as the “world’s principal infringer.”

“Just like the farmer in the Iowa field, we are being robbed every day, in plain sight, by the Chinese Community Party,” Gallagher said. “Our farms are more than just places to grow food, they are research laboratories … we have a duty to protect all our technology, whether it’s in Silicon Valley or on a farm in Iowa.”

Hosted by Rep. Ashley Hinson (R-Iowa) and led by Gallagher and Ranking Member Rep. Raja Krishnamoorthi (D-Ill.), the committee focused on how farmers and others in American agriculture could protect their intellectual property.

“We’re here to highlight and shine a light on what’s going on with this illegal activity,” Krishnamoorthi said. “We can’t sustain this anymore.”

“Our land is sacred,” said Hinson. “We cannot allow the CCP to continue stealing our intellectual property, buying up our farmland and ripping off our farmers and rural manufacturers. We cannot sit idly by any longer. The status quo is too dangerous to maintain.”

Iowa perspectives

While the three members of Congress made clear their concerns, they sought perspective on the issues from three Iowans.

Iowa Soybean Association President-Elect Suzanne Shirbroun of Clayton County, Benton County farmer Lori Lang and Will Cornelius, who along with his family, owns and operates Cornelius Seed in Bellevue, testified to their concerns about protecting Iowa and Midwest agricultural interests.

As the United States considers its relationship with China in the contest of food and agriculture, “we must do so strategically with a firm understanding of our country’s national and agricultural interests,” Shirbroun said.

“While there is little doubt that China has targeted the United States’ intellectual property and engaged in unfair trade practices, let’s proceed cautiously, please, as there isn’t another market that can completely replace China for America’s soybean farmers,” Shirbroun said.

She noted that China has become the largest importer of soybeans in the world and the top export market for U.S. soy at nearly 30 million metric tons annually.

“One in every three rows of soybeans you saw on the drive here today goes to China,” Shirbroun said.

So, how should the U.S. combat unfair trade practices and manage the relationship?

Fairly, but firmly, Shirbroun said.

“Theft of intellectual property and the use of unfair trade practices are unacceptable,” she said. “Such acts should not be tolerated and should be contested.”

Lang and Cornelius were in step with Shirbroun. Lang says the United States needs to pull tighter on the reins of Chinese investment in American agriculture through regulations and the Justice Department. It’s clear the Chinese are seeking U.S. seed technology to withstand poor soil and/or less-than-ideal climate conditions, Cornelius noted.

He pointed out to the advancements of genetic gains over the last several years, pointing out the drought of 1988 where crops were decimated to the drought of 2012, where remarkable yields in soybeans and corn were strong. China, Cornelius says, wants that technology.

“We’re blessed with amazing soil, knowledge and advancements,” he says, adding China is cognizant of American ingenuity and know-how.

Iowa Soybean Association President-elect Suzanne Shirbroun, left, Benton County farmer Lori Lang and Rep. Ashley Hinson meet to discuss concerns related to the theft of U.S. intellectual property, including seeds and ag technology.

Treading carefully, but decisively

Despite the motives of the CCP and other bad actors, Shirbroun cautioned members of Congress that the United States act deliberately and thoughtful in protecting American agricultural interests.

“Soybean farmers started building a relationship and soybean market in China over 40 years ago and we are well aware of the time and financial commitment it takes to establish a new market,” she says.

Shirbroun says she does not agree with some that the United States revoke China’s permanent most-favored nation status to punish the Chinese. A move like that would “decimate agriculture exports and would deal a great blow to farmers.”

She says the U.S. export market must explore other areas of the world where soybeans, corn and other goods can be shared.

Shirbroun cited examples like Cambodia and Vietnam where expansion could help lessen the dependence on China.

She told Gallagher, Krishnamoorthi and Hinson that Congress and the Biden administration need to consider the following:

• Support targeted export controls on sensitive technologies that safeguard U.S. innovation and national security and help farmers and the agriculture industry protect critical data, information, and intellectual property. 
• Work to reduce retaliatory tariffs on U.S. soybeans, broaden the tariff exclusion process, and prioritize progress on outstanding structural challenges in China. This will improve the operating environment for U.S. businesses and farmers and ensure American goods and services are treated fairly. 
• Insist China make real progress in establishing a more predictable, timely, and transparent approval process. While the Phase One Agreement required China to reform its biotech approval process, enforcement was noticeably absent.
• Build upon efforts to improve U.S. ties with other key trading partners with shared interests. It’s been more than a decade since the U.S. entered into a new free trade agreement.
• Expand  farm bill trade promotion programs like the Market Access Program and Foreign Market Development Program to strengthen our relationships that will grow and diversify ag markets. 

What more can be done?

Along with trade expansion, Shirbroun, Cornelius and Lang say more needs to be done in terms of education, research and development (R&D) of new seeds and other ag technologies.

Cornelius says investment in land-grant universities, extension programs and organizations like the ISA need more support from Congress is needed to increase R&D efforts.

Shirbroun added getting more ag-based education in school districts will spur more young people to go into agriculture – not just traditional farming, but all aspects of agriculture, including research, horticulture and more.

“We need money for these programs,” Cornelius says. “Any federal help would be appreciated.”

Both Cornelius and Shirbroun noted that encouraging the development and domestic marketing of biofuels would help alleviate export pressure. The U.S., then, could rely less on foreign oil.

“It all works together,” Cornelius says. “If we can find alternative uses, we can keep more of it at home, and it adds value.”

“Biofuels are a great opportunity,” Shirbroun says. “It’s exciting to be a soybean farmer today with biodiesel, renewable diesel, and sustainable aviation fuel. It’s also a national security issue – we don’t have to look elsewhere for oil, adding value to our products. I’d rather keep our dollars here as much as possible.”

‘Stakes are high’

Congressional members praised Iowa and Midwest farmers for their work in protecting American intellectual property while also feeding the world.

“There’s something special about freedom, to innovate – that rebellious spirit and that reward for those innovations,” says Krishnamoorthi. “Your hard work should be rewarded. It’s hard to mimic that success. We need to protect that ‘secret sauce’ – the American way.”

Hinson says protecting farmers and valuing U.S. ag innovation is critical in determining what the future might hold.

“I trust my farmers to give me the real truth,” she says. “We want to make sure we get it right.”

Krishnamoorthi was more ebullient.

“What you have in Iowa is special and people around the world are trying to copy it,” he says. “They can’t copy it if we are vigilant about our secrets, our research and how we operate. The stakes are about as high as they can be.”

Shirbroun wrapped up the discussion with one last thought:

“Standing on the sidelines of international trade is eroding our global leadership and our long-term economic strength,” she says. “Without fair, firm, thoughtful and deliberate action, the challenges facing us not only threaten my generation’s ability to carry on the family farm, but also my sons’ opportunity as the seventh generation.”

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