February 27, 2018 / 4:27 PM / 6 months ago

GM cotton's return to Burkina Faso on hold over Bayer-Monsanto deal

* Burkina Faso abandoned Monsanto GM varieties in 2016

* Main cotton company had approached Bayer as alternative

By Joe Bavier

ABIDJAN, Feb 27 (Reuters) - Talks with Bayer to reintroduce genetically modified (GM) cotton in Burkina Faso are on hold pending the German drug and crop chemicals maker's acquisition of U.S. rival Monsanto, the head of the West African nation's top cotton company said on Tuesday.

Burkina Faso - Africa's leading cotton grower in recent years - became a showcase for GM cotton technology on the continent when it introduced varieties containing Monsanto's Bollgard II trait in 2008.

However, in 2016 it abandoned the Monsanto varieties, complaining they led to a drop in cotton fibre length resulting in around $85 million in lost earnings for Burkina Faso's cotton companies.

Wilfried Yameogo, the director of Sofitex, Burkina Faso's biggest cotton company, said it initially approached Bayer in 2014 amid its troubles with Monsanto.

Bayer produces cotton traits under the TwinLink Plus and TwinLink trademarks that, like Monsanto's Bollgard II, also use genes from the soil bacterium Bacillus thuringiensis (Bt) to protect against pests.

"We expressed our wish to establish a partnership with Bayer ... Bayer had shown its agreement in principle," Yameogo told Reuters.

However, it subsequently launched a $63.5 billion bid to purchase Monsanto and talks to introduce Bayer's GM cotton traits in Burkina Faso were suspended, Yameogo said.

"They said to wait because they were in the process of managing the purchase of Monsanto. So we're waiting ... Bayer will get back to us," he said.

Bayer declined to comment on the talks.

Faced with anti-trust concerns over the planned acquisition, which the European Commission has said risks reducing competition, Bayer agreed in October to sell a portion of its seed and herbicide businesses to BASF for 5.9 billion euros ($7.3 billion).

Under that deal, which is contingent upon Bayer's successful acquisition of Monsanto, BASF would take over Bayer's global cotton seed business with the exceptions of the Indian and South African markets.

Meanwhile, several African countries continue to test Monsanto's GM cotton varieties.

A representative for Bayer said both the Monsanto acquisition and the deal with BASF required regulatory approval and the company therefore would not speculate on their outcome.

"We had problems with Monsanto due to the fibre length. If we work with Bayer or any other technology developer, that issue of fibre length must be corrected," Yameogo said.

$1 = 0.8120 euros Reporting by Joe Bavier Editing by Mark Potter

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