American long-grain rice producers are facing interruptions to their global export business following contamination of commercial supplies with an unapproved GM variety.

The GM rice concerned is known as LLRICE601 and was developed by German biotech company Bayer in the 1990s, and field tested in the USA from 1998 to 2001.

Bayer notified the US department of agriculture of the contamination at the end of July, following analysis of samples taken from bulk stores in the USA.

The US authorities then set about their own tests.

US agriculture secretary Mike Johanns went public at the end of last week, but insisted that LLRICE601 was totally safe to humans and the environment, even though it had never been fully approved in the USA, or any other country.

“Based on the available data and information, the US Food and Drugs Administration has concluded that the presence of LLRICE601 in the food and feed supply poses no safety concerns,” he said.

It is understood that the variety, which is resistant to the glufosinate Liberty Link, contains the same GM protein as is found in two other GM crops that have been approved.

Bayer says it withdrew the application for a licence for LLRICE601 in the USA because it had no intention of commercialising the variety.

But, now that the product is “in the marketplace”, it has decided to apply for a licence.

Despite these reassurances, the Japanese authorities imposed an immediate trade ban on all US long-grain rice imports.

Environmental lobby group Friends of the Earth International is demanding a similar response from other importing countries.

“This is a complete scandal,” said anti-GM campaigner Nnimmo Bassey.

“The biotech industry has once again failed to control its products and lax regulations in the USA mean that consumers have been put at risk.”

If this call is heeded, US rice exporters face massive potential damage.

Around half the crop is exported, earning almost $1bn (£525m).

The USA currently ranks fourth in world rice exports, behind Thailand, Vietnam and China.