Canada's $320-million flax export industry has been shaken by the discovery of a genetically modified seed believed to have been expunged years ago. (CBC)

Canadian flax seed has been shut out of its largest market after traces of Triffid — a genetically modified form of the crop ordered destroyed 10 years ago — was found in shipments.

The European Union, which buys 70 per cent of Canada's flax, has a zero-tolerance policy regarding genetically modified organisms and has been turning away shipments.

Officials say Canada's entire $320-million industry is threatened.

But efforts to correct the situation are being thwarted because it's not clear where the genetically modified flax is coming from. An industry-wide scramble has been on to weed out the offending seed since the problem was discovered in September.

But when only about one in every 10,000 flax seeds are affected, the Canadian Grain Commission, as well as farmers and members of the Flax Council of Canada, admit they have their work cut out for them trying to track down the source of the problem.

Sifting grain, DNA Tests

The modified Triffid flax seed was deregistered and ordered destroyed 10 years ago. (CBC)

At the CGC's headquarters in Winnipeg, grain inspectors have been sifting through samples of flax, and scientists have been testing for the DNA footprint of the genetically modified strain of flax called Triffid.

Triffid was developed in the 1990s at the University of Saskatchewan and named after the flesh-eating plants featured in John Wyndham's 1951 novel, The Day of the Triffids.

The modified seed was deregistered and ordered destroyed 10 years ago after concerns arose from farmers that the EU would reject it.

'It's a situation no one could have foreseen and it's taken everyone by surprise.'—Remi Gosselin, Canadian Grain Commission

Mysteriously, Triffid has reappeared in commercial crops.

The flax was genetically engineered to contain genes from a weed added to it, allowing it to grow in soil contaminated by herbicides.

"It's a situation no one could have foreseen and it's taken everyone by surprise," said CGC spokesman Remi Gosselin. "The CGC got written assurances in the late '90s that Triffid had been cleared from the system."

Two more of the 10 flax varieties handled by the University of Saskatchewan's Crop Development Centre have shown genetic contamination, managing director Dorothy Murrell told CBC News.

"We're puzzled, but regardless of that, we're taking action and trying to do our part to remove the problem as much as we can," she said. "I'm quite confident that we can remove these two varieties at the pedigree-seed level from the market."

Problem may be bigger than thought

Aggressive testing is underway to detect and round up all of the modified seed. (CBC)

But the Flax Council of Canada, based in Winnipeg, said the country's genetically modified seed problem might run deeper than the strains the university has identified.

"I'm quite certain as we start to test the certified seed, there will be other varieties that will show contamination," said Barry Hall, the council's president. "There's no question this will change the industry forever."

The industry is responding by implementing a three-stage testing regime, Hall said.

'There's no question this will change the industry forever.'—Barry Hall, Flax Council of Canada

"The farm samples are tested. The rail cars are tested. And then, as the vessel is loaded, samples are drawn and tested by the Canadian Grain Commission," he said.

But aggressive testing isn't a silver bullet to round up all the genetically modified flax seed, Hall admits.

"It doesn't mean the Europeans can't test further and it will turn up positive there. Canada is doing everything it can to clean this up."

The worst-case scenario for flax producers is that the industry will shut down for three to five years to purge whatever seed is already growing, Hall said. Eventually, he added, all contaminated seeds will be taken off the market and destroyed.

Farmer's union predicted problems

But Hall's assurance hasn't convinced the National Farmers' Union.

"Myself and others predicted this would happen and that's why we worked to get rid of [it] 10 years ago," said president Terry Boehm. "If you're going to play around with [genetically modified] crops, once the genie's out of the bottle, once it's in the environment, you can't control it," Boehm said.

Federal officials are in talks with the EU in hopes of raising its tolerance for genetically modified organisms, but Hall said he believes lobby groups have European politicians wary of change.