Why China is stealing America's corn seeds

corn china

Three years ago, a security guard working for seed company Pioneer Hi-Bred came across something unusual on a road in Iowa: Just off the pavement, a man was on his knees, digging in a field.

Challenged by the guard, Mo Hailong claimed to be an employee of the University of Iowa who was traveling to a nearby conference. He jumped back in his car and sped away.

U.S. authorities would later accuse Mo, and five other Chinese nationals, of stealing corn seeds and attempting to smuggle them back to China.

A seventh defendant, Mo Yun, was arrested and charged Wednesday with stealing trade secrets for her husband's seed company -- the Beijing Dabeinong Technology Group Company.

The details of the case, laid out by prosecutors, underscore the difficulty of safeguarding U.S. intellectual property, and the determination of some foreign rivals to acquire technology by illicit means.

For six years, the Chinese nationals hopscotched across rural Iowa and Illinois, stealing valuable inbred corn seed from Pioneer, Monsanto (MON) and LG Seeds, prosecutors said in an updated indictment. The group rented storage facilities, bought their own testing field and concocted elaborate cover stories.

"These are actually very serious offenses," one of the accused said during a recorded conversation reproduced in the indictment. "They could treat us as spies," his colleague replied.

Three members of the group tried to smuggle the stolen goods out of the U.S. in 2012, concealing hundreds of seeds in Orville Redenbacher popcorn boxes and Subway napkins. One tried to reach Canada; the others boarded aircraft bound for Beijing.

Related: Russia attacks U.S. oil and gas companies in massive hack

Why Starbucks talks to parents in China
Why Starbucks talks to parents in China

The Chinese nationals weren't risking imprisonment for just any corn -- they were after inbred seeds used to create the hybrids that are then sold to farmers.

Inbreds are closely guarded secrets. Companies spend tens of millions of dollars on research to produce strains that boost yields and are resistant to drought and insects.

China has become a major corn importer in recent years, and the stolen technology could have played a role in boosting domestic production.

The case is the latest in a series of incidents involving Chinese nationals working in the U.S. Some are accused of stealing rice technology and aerospace secrets for China.

"Identifying and deterring those focused on stealing trade secrets, propriety and confidential information or national security information is the number two priority for the FBI second only to terrorism," FBI special agent Thomas Metz said in a statement.

Beijing Dabeinong Technology Group Company, and its subsidiary, Beijing Kings Nower Seed, did not respond to requests for comment.

Analysts say that Beijing's use of economic espionage can be attributed in part to its drive to modernize the country in recent decades.

The illicit acquisition of technology has helped China accelerate the process, bypassing problems that would otherwise require years of research to resolve. It's an issue that has drawn the attention of the White House.

Related: China's long history of spying on business

President Obama has raised the issue with his Chinese counterpart, Xi Jinping. But his arguments have carried less weight following revelations by Edward Snowden that U.S. agencies were attempting to monitor Chinese telecommunications company Huawei.

Chinese officials have been quick to levy charges of hypocrisy against the U.S. An official at the Ministry of Foreign Affairs said in May that the U.S. was engaged in theft of secrets and snooping on companies, politicians and others.

-- CNN's Vivian Kam contributed reporting.

Personal Finance

CNNMoney Sponsors