Argentina is working on a new seed law to protect intellectual property rights for agricultural biotechnology in a bid to lure Monsanto Co. (MON) to bring its second generation of transgenic-soybean seeds into the country.

"We've decide to move forward on a seed law draft, as corresponds in a country that aspires to be a leader in food production," agriculture minister Norberto Yauhar said in a press release Tuesday.

"We're looking to protect intellectual property in the development process," Mr. Yauhar said, adding that the bill will be sent to congress for debate in the coming months.

Argentina is the world's top soymeal and soyoil exporter, and ranks third behind the U.S. and Brazil in soybean exports.

Agricultural-biotech-company Monsanto is planning on selling its second-generation of transgenic-soybean seeds in Argentina in 2014 despite struggling for years to collect royalties on the first-generation seeds.

The U.S. patent for those first-generation soybean seeds, which are genetically modified to resist the herbicide glyphosate, runs out in 2014. The new seeds, will add insect resistance as well.

Monsanto failed to obtain a local patent for the genetically modified soybean seeds it introduced in Argentina 15 years ago and its efforts to collect royalties have been foiled by local regulations.

However, Monsanto says it is making progress in reaching an agreement with growers to pay royalties before introducing the new, improved strain of soybean seeds.

Monsanto has a patent for the new seeds in Argentina, but under current local law, farmers aren't required to pay royalties on the seeds they hold back for the next planting season.

Virtually all of the soybeans grown in Argentina are based on Monsanto's technology and the company is hoping that the potential yield increase for the second generation seeds will entice Argentina to get serious on ensuring it can collect royalties.

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Argentina Plans New Biotechnology Law in Bid to Tempt Monsanto