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Genetically modified wheat created by Monsanto Co. (MON) that wasn’t approved for use turned up on an 80-acre farm in Oregon last month, threatening the outlook for U.S. exports of the grain that are the world’s largest.

A farmer attempting to kill wheat with Monsanto’s Roundup herbicide found several plants survived the weedkiller, the U.S. Department of Agriculture said yesterday in a statement. Scientists found the wheat was a strain field-tested from 1998 to 2005 and deemed safe before St. Louis-based Monsanto, the world’s largest seedmaker, pulled Roundup Ready wheat from the regulatory approval process on concern that importers would avoid the crop.

“I would imagine even the perception that GM wheat is out there would have some impact on our exports” with so many countries “putting their foot down on not accepting” gene-altered crops, Ryan Larsen, an assistant professor of agribusiness and applied economics at North Dakota State University in Fargo, said by telephone. “This continues that bad persona that GM crops have. It allows people to say ‘See, it’s out there and we’re not being told it’s out there.’ “

Wheat futures fell 0.5 percent to $6.99 a bushel by 4:58 a.m. on the Chicago Board of Trade. Japan suspended imports of western-white wheat and feed wheat from the U.S., and canceled an order, said Hiromi Iwahama, director for grain trade and operation at the Ministry of Agriculture, Forestry and Fisheries. The European Union will recommend countries test imported U.S. wheat.

No Threat

Government investigators are tracking the origin of the plants and consulting with trade partners to assure them the exposure is limited and poses no threat to human health, according to Michael Firko, acting deputy administrator at the USDA‘s Animal and Plant Health Inspection Service. No evidence exists that the never-approved wheat has entered the commercial food or feed supply, he said. Monsanto said there’s reason to believe the incident is highly isolated and should not concern consumers or trading partners.

“There are no food, feed, or environmental safety concerns associated with the presence of the Roundup Ready gene if it is found to be present in wheat,” Monsanto said yesterday in a statement. “Over the past decade, an annual average of 58 million acres of wheat have been planted in the U.S. This is the first report of the Roundup Ready trait being found out of place since Monsanto’s commercial development program was discontinued nine years ago.”

Monsanto Plans

Monsanto halted plans to develop modified wheat in May 2004 after the Canadian Wheat Board, then the world’s largest grain seller, said its 10 biggest red spring-wheat importers, including Japan, the U.K. and Malaysia, wouldn’t accept modified varieties. Italy’s biggest miller, Grandi Molini Italiani, was among buyers in Europe and Asia that refused to import modified wheat amid consumer unease over eating such products.