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Global Impact of Biotech Crops:
economic & environmental effects
1996-2012
Graham Brookes
PG Economics Ltd
UK
©PG Economics Ltd 2014
Background
• 9th annual review of global GM crop impacts
• Authors of 17 papers on GM crop impacts in peer review journals
• Current review in 2 open access papers in journal GM crops. www.landesbioscience.com/journal/gmcrops
• Full report available at www.pgeconomics.co.uk
©PG Economics Ltd 2014
Coverage
• Cumulative impact: 1996-2012
• Farm income & productivity impacts: focuses on farm income, yield, production
• Environmental impact analysis covering pesticide spray changes & associated environmental impact
• Environmental impact analysis: greenhouse gas emissions
©PG Economics Ltd 2014
Methodology
• Review and use of considerable economic impact literature plus own analysis
• Uses current prices, exch rates and yields (for each year) & update of key costs each year: gives dynamic element to analysis
• Review of pesticide usage (volumes used) or typical GM versus conventional treatments
• Use of Environmental Impact Quotient (EIQ) indicator
• Review of literature on carbon impacts – fuel changes and soil carbon
©PG Economics Ltd 2014
Key Findings
Pesticide
change 1996-2012Carbon Emissions
2012
Global
1996-2012
Global
farm income
1996-2012
503 million kg
reduction in pesticides & 18.7% cut in associated
environmental
impact
cut of 27 billion kg co2 release; equal to taking 11.9 million cars off the
road
$116.6 billion increase
©PG Economics Ltd 2014
Farm income gains 2012: highlights
• Total farm income benefit $18.8 billion
• Equal to adding value to global production of these four crops of 6%
• Average gain/hectare: $117
• Income share: 50% each developed and developing countries
©PG Economics Ltd 2014
Zimbabwe
Zambia
Yemen Vietnam
Venezuela
Vanuatu
Uzbekistan
Uruguay
United States
United Kingdom
U.A.E.
Ukraine
Uganda
TurkmenistanTurkey
Tunisia
Togo
Thailand
Tanzania
Tajikistan
Syria
Switz.
Sweden
Swaziland
SurinameSri Lanka
Spain
South Africa
Somalia
Solomon Islands
Slovenia
Slovakia
Sierra Leone
Senegal
Saudi Arabia
Rwanda
Russia
Romania
Qatar
Portugal
Poland
Philippines
Peru
Paraguay
PapuaNew Guinea
Panama
Pakistan
Oman
Norway
Nigeria
Nicaragua
New Zealand
Netherlands
Nepal
Namibia Mozambique
Morocco
MongoliaMoldova
Mexico
Mauritania
Mlta
Malaysia
Malawi
Madagascar
Macedonia
Lux.
Lithuania
Liberia
Lesotho
Lebanon
Latvia
Laos
Kyrgyzstan
Kuwait
S. Korea
Taiwan
N. Korea
Kenya
Kazakhstan
Jordan
Japan
Jamaica
Italy
Israel
Ireland
Iraq Iran
IndonesiaIndonesia
India
Hungary
Honduras
Haiti
Guyana
Guinea-Bissau Guinea
Guatemala
Greece
Ghana
Germany
Georgia
Gambia
Gabon
French Guiana
France
Finland
Fiji
Estonia
Eritrea
Equatorial Guinea
El Salvador
Ecuador
East Timor
Dominican Republic
Dijbouti
Denmark
Czech Rep.
Cyprus
Cuba
Coted’Ivoire
Costa Rica
Congo
Dem. Rep.Congo
Colombia
China
Chile
CentralAfricanRepublic
Cape Verde
Canada
Cameroon
Cambodia
Burundi
Burma
BurkinaFaso
Bulgaria
Brunei
Brazil
Botswana
Bolivia
Bhutan
Benin
Belize
Bel.
Belarus
BangladeshBahamas
Azerbaijan
Austria
Australia
Armenia
Argentina
Angola
Albania
Afghanistan
Western Sahara
Bosnia &Herz.
SerbiaMontenegro
Croatia
Farm income gains 1996-2012 by country
(US $)
Canada$4.8 billion increase
United States$52 billion increase
Mexico$238 million increase
Bolivia —$432 million
— Brazil$8.4 billion increase
— Paraguay
$828 million increase
— Argentina15.6 billion
increase
South Africa$1.2 billion increase
Australia$765 million increase
Philippines$379 million
China$15.3 billion increase
India$14.6 billion increase
Spain$176 million
Uruguay —$121 million
Colombia$83 million
Farm income benefits: EU (US
$ million)2012 1996-2012 % of crop using
technology 2012
(Spain)
Insect resistant
corn
39.9 195.1 30
Year first used: IR corn 1998 Spain
Average benefit/ha 1998-2012 $205/ha
©PG Economics Ltd 2014
Other farm level benefits
GM HT crops GM IR crops
Increased management
flexibility/convenience
Production risk management tool
Facilitation of no till practices Machinery & energy cost savings
Cleaner crops = lower harvest cost &
quality premia
Yield gains for non GM crops
(reduced general pest levels)
Less damage in follow on crops Convenience benefit
Improved crop quality
Improved health & safety for
farmers/workers©PG Economics Ltd 2014
In US these benefits valued at $10
billion 1996-2012
Cost of accessing the technology ($
billion) 2012
©PG Economics Ltd 2014
• Distribution of total trait
benefit: all (tech cost 23%) –every $1 invested in seed = $3.3 in extra
income
• Distribution of benefit:
developing countries (tech cost
21%) every $1 invested in seed = $3.7 in
extra income
Cost of tech goes to seed supply chain (sellers of seed to
farmers, seed multipliers, plant breeders, distributors &
tech providers)
Farm income, 18.8
Cost of tech, 5.6
Farm income, 11.0
Cost of tech, 2.3
Yield gains versus cost savings
• 42% ($49 billion) of total farm income gain due to yield
gains 1996-2012
• Balance due to cost savings
• Yield gains mainly from GM IR technology & cost savings
mainly from GM HT technology
• Yield gains greatest in developing countries & cost savings
mainly in developed countries
• HT technology also facilitated no tillage systems – allowed
second crops (soy) in the same season in S America
©PG Economics Ltd 2014
IR corn: average yield increase 1996-2012
7.0%
11.6%
6.3%
18.4%
10.4%
5.6%13%
21.4%
5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
US & Can S Africa Argentina Philippines Spain Uruguay Brazil Colombia CRWUS/Can
©PG Economics Ltd 2014
Average across all countries:
+10.4%
IR cotton: average yield increase 1996-2012
©PG Economics Ltd 2014
Average across all countries:
+16.1%
9.8% 10%
24%
10%
30%
-1%
36%
21%
18%
30%
22%
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
US China S Africa Mexico Argentina Brazil India Colombia BurkinaFaso
Burma Pakistan
HT traits: yield and production effects
©PG Economics Ltd 2014
Trait/country Yield/production effect
HT soy: Romania, Mexico,
Bolivia
+23%, +7% & +15%
respectively on yield
HT soy: 2nd generation: US &
Canada
+10% to +11% yield
HT soy Argentina & Paraguay Facilitation of 2nd crop soy
after wheat: equal to +15%
and +7% respectively to
production level
HT corn: Argentina, Brazil,
Philippines
+10%, +3% & +5%
respectively on yield
HT cotton: Mexico, Colombia,
Brazil
+8%, +4% & +2%
respectively on yield
HT canola: US, Canada &
Australia
+2.4%, +5.9% & +16.5%
respectively on yield
Additional crop production arising from positive yield
effects of biotech traits 1996-2012 (million tonnes)
©PG Economics Ltd 2014
0.0
50.0
100.0
150.0
200.0
250.0
Soybeans Corn Cotton Canola
12.1
34.1
2.4 0.4
122.3
231.4
18.2
6.9
2012 1996-2012
Additional conventional area required if
biotech not used (m ha)
2012 1996-2012
Soybeans 4.9 49.4
Maize 6.9 47.0
Cotton 3.1 23.6
Canola 0.2 3.9
Total 15.2 123.9
©PG Economics Ltd 2014
Price impacts
• Additional production
from biotech has
contributed to
lowering world prices
of grains and oilseeds
Crop/Commodity Biotech benefit to
world prices (2007
baseline)
Soybeans -5.8%
Corn -9.6%
Canola -3.8%
Soy oil -5%
Soymeal -9%
Canola oil & meal -4%
Source: Brookes G et al (2010) The production and price impact of biotech crops, Agbioforum 13 (1) 2010. www.agbioforum.org
©PG Economics Ltd 2014
Impact on pesticide use
• Since 1996 use of pesticides down by 503 m kg (-8.8%) &
associated environmental impact -18.7% - equivalent to 2 x
total EU (28) pesticide active ingredient use on arable
crops in one year
• Largest environmental gains from GM IR cotton: savings
of 205 million kg insecticide use & 28% reduction in
associated environmental impact of insecticides
©PG Economics Ltd 2014
Impact on greenhouse gas emissions
Lower GHG emissions: 2 main
sources:
• Reduced fuel use (less spraying
& soil cultivation)
• GM HT crops facilitate no till
systems = less soil preparation
= additional soil carbon storage
©PG Economics Ltd 2014
Reduced GHG emissions: 2012
• Reduced fuel use (less
spraying & tillage) = 2.1
billion kg less carbon
dioxide
• Facilitation of no/low till
systems = 24.6 billion kg
of carbon dioxide not
released into atmosphere
=
Equivalent to removing 11.9 million
cars — 41% of cars registered in the
United Kingdom — from the road
for one year
©PG Economics Ltd 2014
Reduced GHG emissions: 1996-2012
• less fuel use = 16.7 billion kg
co2 emission saving (7.4 m cars
off the road)
• additional soil carbon
sequestration = 203 billion kg
co2 saving if land retained in
permanent no tillage. BUT
only a proportion remains in
continuous no till so real figure
is lower (lack of data means not
possible to calculate)
©PG Economics Ltd 2014
Concluding comments
• Technology used by 17.3 m farmers on 160 m ha in 2012
• Delivered important economic & environmental benefits
• + $116.6 billion to farm income since 1996
• -503 m kg pesticides & 18.7% reduction in env impact associated with pesticide use since 1996
• Carbon dioxide emissions down by 27 billion kg in 2012: equal to 11.9 m cars off the road for a year
©PG Economics Ltd 2014
Concluding comments
• GM IR technology: higher yields, less production risk, decreased insecticide use
leading to improved productivity and returns and more environmentally farming
methods
• GM HT technology: combination of direct benefits (mostly cost reductions) &
facilitation of changes in farming systems (no till & use of broad spectrum
products) plus major GHG emission gains
• Both technologies have made important contributions to increasing world
production levels of soybeans, corn, canola and cotton
• GM HT technology has seen over reliance on use of glyphosate by some farmers in
North/South America: contributed to weed resistance problems and need to
change/adapt weed control practices. Resulted in increases in herbicide use in last
few years but environmental impact of herbicides used are still better than
conventional crop alternative
©PG Economics Ltd 2014
EU 28
• Farm users of IR maize getting important economic and environmental
gains
• IR maize delivering better quality (lower mycotoxins) grain (note we
feed it to animals not humans!)
• Most EU farmers not getting benefit of higher yields and lower costs –
discouraged to use with non science-based co-existence rules or illegal
national bans on planting
• EU farm sector losing out competitively with imports and on world
markets
• EU citizens missing out on environmental benefits
©PG Economics Ltd 2014