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Economic Benefits
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Biotech Crops Boost Incomes, Raise Living
Standards Around the World
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Farmers of all types — from an Amish tobacco farmer in the United States
to a corn farmer in the Philippines — continue to embrace biotech crops
because they help improve living standards.
Amish farmer Daniel Dienner says he earns nearly twice as much planting a biotech
nicotine-free tobacco as he would planting a conventional variety — $1.50
per pound vs. 80 cents per pound. Meanwhile, Filipino farmer Edwin Paraluman
says he earns about 50 percent more by planting biotech corn than he did growing
conventional varieties.
Their experience is shared by farmers from around the world. Perhaps the most
telling statistic about the economic benefits of biotech crops is how quickly
these global farmers have embraced the new technology.
An estimated 8.25 million farmers in 17 countries now plant biotech crops —
up from 7 million farmers in 18 countries in 2003, according to the nonprofit
International Association for the Acquisition of Agri-biotech Applications (ISAAA).1
"This is an unwavering and resolute vote of confidence in the technology
from … farmers, who are masters in risk aversion and have consistently
chosen to plant an increasing hectarage of biotech crops year after year after
year," wrote ISAAA chair Clive James in a January 2005 report, "Global
Status of Commercialized Biotech/GM Crops: 2004."2
Farmers have adopted the technology so quickly for several simple reasons:
Biotech crops improve yields, cut costs and reduce spraying. Not only do these
benefits improve farmers' bottom lines, but they also save time — improving
their quality of life by giving them more time to spend with their families
and to pursue other activities.3
A study by a University of Minnesota food and trade policy analyst reported
that the global commercial value of biotech crops in the 2003-2004 crop year
was US$44 billion — a value that is expected to grow to $210 billion by
the end of the decade.4
"The international adoption and diffusion of biotech crops has gone global
and is poised to transform production and development around the world,"
said C. Ford Runge, director of the University of Minnesota's Center for International
Food and Agricultural Policy and Distinguished McKnight University Professor
of Applied Economics and Law.
Several academic research studies have quantified the economic gains derived
from planting biotech crops.
An October 2004 study by the National Center for Food and Agricultural Policy
(NCFAP) found that U.S. farmers who planted six genetically enhanced crops in
2003 — canola, corn, cotton, papaya, soybean and squash — earned an
additional $1.9 billion more than what they have earned planting convention
varieties. In addition, the enhanced varieties boosted crop yields by 5.3 billion
pounds and reduced pesticide use by 46.4 million pounds.
"Whether it was papaya in Hawaii, cotton in Louisiana or soybeans in South
Dakota, the benefits from growing biotech crops were significant," said
Sujatha Sankula, the lead author of the study titled "Impacts on U.S. Agriculture
of Biotechnology-Derived Crops Planted in 2003: An Update of 11 Case Studies."
An earlier NCFAP study, released in June 2003, found that the wide-scale adoption
of three biotech crops in Europe — corn, potatoes and sugar beets —
could increase farmer income by more than 1 billion euros, boost annual production
by 17 million pounds and reduce pesticide spraying by 21.7 million pounds.
Several other studies and researchers have validated the economic and environmental
benefits of biotech crops:
- In the Philippines, the net incomes of farmers who planted Bt corn were
about 34 percent higher than the incomes of farmers who planted conventional
corn, according to ISAAA.5 Bt maize could meet the subsistence requirement
of a family of five in the Philippines, whereas conventional maize could not.6
- In Spain, Bt corn yields were about 6.3 percent higher, on average, than
conventional varieties, which resulted in extra income of $85 per acre, according
to ISAAA.7
- In Canada, planting of biotech canola in 2000 resulted in extra income of
$5.80 per acre over conventional varieties, according to a study conducted
by the Canola Council of Canada.8 Yields were 10 percent higher for biotech
canola, or three bushels more per acre.
- Around the world between 1998 and 2001, Bt cotton growers earned an additional
$1.7 billion, according to ISAAA.9 Yield increases for Bt cotton ranged from
5 percent to 10 percent in China, 10 percent or more in the United States
and Mexico, and 25 percent in South Africa.
"It is important that a human face is put on the benefits of Bt cotton,"
James said. "For the average cotton holding of 1.7 hectares in the Makhathini
Flats in South Africa, in a typical season, a woman farmer is relieved of 12
days of arduous spraying, saves over 1,000 liters of water [over 250 U.S. gallons]
... and increases her income by approximately $85 per season, through using
Bt cotton rather than conventional cotton."10
T.J. Buthelezi, a cotton farmer from South Africa who now plants biotech seeds,
said, "Normally, at the end of the year, I would ask my wife how we are
going to pay our bills. Now I ask her, how are we gonna spend this money?"
For more information:
The Global Diffusion of Plant Biotechnology: International Adoption and Research
in 2004  — C. Ford Runge and Barry Ryan, University of Minnesota
Impacts on U.S. Agriculture of Biotechnology-Derived Crops Planted in 2003:
An Update of 11 Case Studies (Executive summary) — National Center for
Food and Agricultural Policy
Global Status of Commercialized Biotech/GM Crops: 2004 (Executive Summary)
— International Association for the Acquisition of Agri-biotech Applications
Plant Biotechnology: Potential Impact for Improving Pest Management in European
Agriculture: Preliminary Release of Three Case Studies — NCFAP (executive
summary and press release in English, French, German and Spanish)
The Economic Status and Performance of Plant Biotechnology in 2003: Adoption,
Research and Development in the United States — C. Ford Runge and Barry
Ryan, University of Minnesota
Farmers From Around the World Praise Biotech Crops — Council for Biotechnology
Information
Biotech Crops Raise U.S. Grower Incomes, Promote Environmentally Friendly Farming
— Council for Biotechnology Information
Biotech Crops Could Boost Incomes and Reduce Spraying in Europe — Council
for Biotechnology Information
Biotech Acres: Global Biotech Plantings Show Double-Digit Growth for Ninth
Straight Year — Council for Biotechnology Information
A Compilation of Papers and Reviews of Biotech Crop Yields and Their Environmental
Impacts — AgBioWorld.org
Biotechnology in Africa: The Adoption and Economic Impacts of Bt Cotton in
the Makhathini Flats, Republic of South Africa — University of Reading
(United Kingdom)
Plant Biotechnology: Current and Potential Impact for Improving Pest Management
in U.S. Agriculture, An Analysis of 40 Case Studies — National Center for
Food and Agricultural Policy executive summary
The Farm Level Impact of Using Bt Maize in Spain— Agricultural Biotechnology
in Europe
Impact of Transgenic Canola on Growers, Industry and Environment —- Canola
Council of Canada
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