GM crop technology use 1996-2018: farm income and production impacts

Abstract

This paper estimates the global value of using genetically modified (GM) crop technology in agriculture at the farm level. It follows and updates earlier studies which examined impacts on yields, key variable costs of production, direct farm (gross) income, and impacts on the production base of the four main crops of soybeans, corn, cotton, and canola. This updated analysis shows that there continues to be very significant net economic benefits at the farm level amounting to $18.9 billion in 2018 and $225.1 billion for the period 1996-2018 (in nominal terms). These gains have been divided 52% to farmers in developing countries and 48% to farmers in developed countries. Seventy-two per cent of the gains have derived from yield and production gains with the remaining 28% coming from cost savings. The technology has also made important contributions to increasing global production levels of the four main crops, having, for example, added 278 million tonnes and 498 million tonnes, respectively, to the global production of soybeans and maize since the introduction of the technology in the mid-1990 s. In terms of investment, for each extra dollar invested in GM crop seeds (relative to the cost of conventional seed), farmers gained an average US $3.75 in extra income. In developing countries, the average return was $4.41 for each extra dollar invested in GM crop seed and in developed countries the average return was $3.24.

Keywords: Yield; cost; genetically modified crops; income; production.