and Environmental Impacts of LMOs: The Case of Bt Corn in the - - PowerPoint PPT Presentation

SIKAP/STRIVE, INC.

The Socio-economic and Environmental Impacts of LMOs:

The Case of Bt Corn in the Philippines*

*Paper presented during the Tuesday Forum of the MAP ABCD Foundation, Formation House, Estrada St. Corner Amapola St. Guadalupe Viejo, Makati City, Metro Manila ** Founding President and Chairman, SIKAP/STRIVE, Inc. Email: lag@strivefoundation.com

Leonardo A. Gonzales, PhD**

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Outline of the Presentation

• Global Trends in the Commercial

Adoption of GM Crops

• Empirical Findings of the SIKAP/STRIVE,
• Inc. Impact Assessment Study
• Conclusions
• Recommendations

I S A A A

I S A A A

Global Area (Million Hectares) of Biotech Crops, 2014: by Country

Biotech Mega Countries

50,000 hectares (125,000 acres), or more

1. USA 2. Brazil* 3. Argentina* 4. India* 5. Canada 6. China* 7. Paraguay* 8. Pakistan* 9. South Africa* 10. Uruguay* 11. Bolivia* 12. Philippines* 13. Australia 14. Burkina Faso* 15. Myanmar* 16. Mexico* 17. Spain 18. Colombia* 19. Sudan* 73.1 42.2 24.3 11.6 11.6 3.9 3.9 2.9 2.7 1.6 1.0 0.8 0.5 0.5 0.3 0.2 0.1 0.1 0.1

Less than 50,000 hectares

Honduras* Chile* Portugal Cuba* Czech Republic Romania Slovakia Costa Rica* Bangladesh* * Developing countries

3 to 4%

Increase over 2013

28 countries which have adopted biotech crops In 2014, global area of biotech crops was 181.5 million hectares, representing an increase of 3 to 4% over 2013, equivalent to 6.3 million hectares. Source: Clive James, 2014.

Million Hectares

87% Americas 2% Africa 11% Asia

I S A A A

Global Area of Biotech Crops, 1996 to 2014: By Trait (Million Hectares, Million Acres)

Source: Clive James, 2014

M Acres

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

20 40 60 80 100 120 49 99 148 198 247 297 Herbicide Tolerance Insect Resistance (Bt) Stacked Traits

I S A A A

Global Adoption Rates (%) for Principal Biotech Crops (Million Hectares, Million Acres), 2014

Source: Clive James, 2014

Hectarage based on FAO Preliminary Data for 2012. M Acres

20 40 60 80 100 120 140 160 180 200 82% Soybean 68% Cotton 30% Maize 25% Canola 49 99 140 198 247 296 346 395 445 494

111 37 184 36

Conventional Biotech

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LMO ADOPTION IN THE PHILIPPINES

• The GM corn technology is now more

ten years old in the Philippines

• In 2002: Bt or corn borer resistant corn
• In 2005: HT or herbicide tolerant corn; and

Bt/HT or Stacked corn

• In 2007: Bt corn first renewal of

propagation permit

• In 2014: Around 830,000 hectares were

planted to GM Corn.

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200 400 600 800 1000 1200 1400 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Area Planted ('000 ha) Year

Area Planted to Yellow Corn by Seed Technology, 1995-2013.

Bt HT Stacked (Bt/HT) Pyramided Stacked Yellow Corn

2002/2007: MON810 2005/2010: NK603, Bt11, Stacked

Note: 1995-2013 data series came from BPI; 2012 and 2013 are own estimates of SIKAP/STRIVE, Inc.

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SIKAP/STRIVE, INC. IMPACT ASSESSMENT STUDY

• Covered nine major corn producing

provinces

• Eight cropping seasons (2003-2004 

2011-2012)

• Sample corn households of 3,505

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IMPACT ASSESSMENT STUDY

The basic research hypothesis was:

• Technological innovations like GM

Products are sustainable if they provide positive socio-economic impacts to society and are compliant with the basic requirements of the natural resource systems.

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EMPIRICAL FINDINGS

• A. Impacts of Bt Corn 2003-2011

Microeconomic farm level impacts

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EMPIRICAL FINDINGS

A.1 Farm level impact – Yield

• The average yield advantage of Bt

corn over ordinary hybrid (OH) corn was 19% from 2003 to 2011.

• The corn borer resistance

agronomic trait of Bt corn largely contributed to the yield difference.

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0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Yield (mt/ha) Year

Trends in Yellow Corn Yield by Seed Technology.

Yellow Corn (National) Bt GM (Bt, HT and Bt/HT) Average Ordinary Hybrid 2002/2007: MON810 2005/2010: NK603, Bt11 2007: El Niño

22% OH vs Natio- nal 19% Bt vs OH

2004-05: El Niño

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EMPIRICAL FINDINGS

A.1 Farm level impact – Cost

• On the average, Bt corn has a cost

advantage of 10% relative to OH corn from 2003 to 2011.

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0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Farm Level Production Cost (P/kg, 2003 Constant Prices)

Year

Trends in Yellow Corn Farm Production Cost.

Bt GM (Bt, HT and Bt/HT) Average Ordinary Hybrid 2002/2007: MON810 2005/2010: NK603, Bt11

10% Bt vs OH 15

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EMPIRICAL FINDINGS

A.1 Farm level impact – Income

• The average real peso per

kilogram income advantage of Bt corn over OH corn was 8% per annum from 2003 to 2011.

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0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0 5.5 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Farm Level Income (P/kg, 2003 Constant Prices) Year

Trends in Yellow Corn Farm Income.

Bt GM (Bt, HT and Bt/HT) Average Ordinary Hybrid 2002/2007: MON810 2005/2010: NK603, Bt11

8% Bt vs OH 17

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EMPIRICAL FINDINGS

A.1 Farm level impact – Economic carrying capacity

• Bt corn consistently outperformed OH

corn by 29%, in meeting the food and poverty thresholds, from 2003 to 2011.

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Carrying Capacity Ratio.

NFIi x Li CCi =

• SE x 1.15

Where: CCi is the carrying capacity ratio of activity i; Nii = net income of activity i; Li = is the landholding from activity i; and SE = subsistence level expenditures or poverty thresholds for a family of five and the 0.15 in 1.15 represents 15 percent savings of households.

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0.0 0.5 1.0 1.5 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Food Carrying Capacity Ratio (using 2003 Constant Prices)

Year

Trends in Yellow Corn Food Carrying Capacity.

Bt GM (Bt, HT and Bt/HT) Average Ordinary Hybrid 2002/2007: MON810 2005/2010: NK603, Bt11 29% Bt vs OH

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0.0 0.5 1.0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Poverty Carrying Capacity Ratio (using 2003 Constant Prices)

Year

Trends in Yellow Corn Poverty Carrying Capacity.

Bt GM (Bt, HT and Bt/HT) Average Ordinary Hybrid 2002/2007: MON810 2005/2010: NK603, Bt11 29% Bt vs OH

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EMPIRICAL FINDINGS

A.1 Farm level Impact – Return on investment

• Bt corn users had 42% higher return
• n investment than OH corn users

from 2003 to 2011.

• In order to recover the investments at

the farm level, corn yield must be at least 4.0 mt/ha.

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10 20 30 40 50 60 70 80 90 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Return on Investment (%, using 2003 Constant Prices)

Year

Trends in Yellow Corn Farm Level Return on Investment.

Bt GM (Bt, HT and Bt/HT) Average Ordinary Hybrid 2002/2007: MON810 2005/2010: NK603, Bt11 42% Bt vs OH

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EMPIRICAL FINDINGS

• A. Impacts of Bt Corn 2003-2011

Environmental impacts

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EMPIRICAL FINDINGS

A.2 Environmental impact indicators

• Resource use efficiency is the amount
• f resource needed to produce one mt
• f corn grain
• In terms of ratio:

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INPUT RESOURCE USE

• ----------- OR -------------------------------

OUTPUT GRAIN PRODUCTION

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EMPIRICAL FINDINGS

A.2 Environmental impact – Land use efficiency

• Bt corn seed users required 15% less

land than OH corn seed users in generating one metric ton of corn grain from 2003 to 2011.

• The land use efficiencies of the

analyzed seed technologies (OH, Bt and GM) increased dramatically during this period.

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0.0 0.1 0.2 0.3 0.4 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Land Use Efficiency (ha/mt grain) Year

Land Use Efficiency of Yellow Corn by Seed Technology.

Yellow Corn (National) Bt GM (Bt, HT and Bt/HT) Average Ordinary Hybrid National: 27% ↑ EFF in 11 Years Bt: 35% ↑ EFF in 8 Years Ordinary Hybrid: 39% ↑ EFF in 8 Years

15% Bt vs OH 27

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EMPIRICAL FINDINGS

A.2 Environmental impact – Fertilizer use efficiency

• Bt corn adopters, on the average, were

9% more efficient in the use of fertilizer than OH corn seed users from 2003 to 2011.

• Fertilizer use efficiency across the

analyzed seed technologies improved during this period.

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5 10 15 20 25 30 35 40 45 50 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Fertilizer Use Efficiency (kg NPK/mt grain) Year

Fertilizer Use Efficiency of Yellow Corn by Seed Technology.

Yellow Corn (National) Bt GM (Bt, HT and Bt/HT) Average Ordinary Hybrid National: 25% ↑ EFF in 11 Years Bt: 43% ↑ EFF in 8 Years Ordinary Hybrid: 35% ↑ EFF in 8 Years

9% Bt vs OH 29

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EMPIRICAL FINDINGS

A.2 Environmental impact – Labor use efficiency

• Bt corn seed users were 26% more

efficient than OH corn seed users in terms of labor usage from 2003 to 2011.

• There was general labor use efficiency

improvement across seed technologies during the same period.

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2 4 6 8 10 12 14 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Human Labor Use Efficiency (mandays/mt grain) Year

Labor Use Efficiency of Yellow Corn by Seed Technology.

Yellow Corn (National) Bt GM (Bt, HT and Bt/HT) Average Ordinary Hybrid National: 30% ↑ EFF in 11 Years Bt: 46% ↑ EFF in 8 Years Ordinary Hybrid: 50% ↑ EFF in 8 Years

26% Bt vs OH

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EMPIRICAL FINDINGS

A.2 Environmental impact – Pesticide use efficiency

• Bt corn required 54% less pesticides

than OH corn in order to produce the same amount of corn grain from 2003 to 2011.

• All seed technologies analyzed were

associated with decreasing pesticide application rates during the study period.

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50 100 150 200 250 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Pesticide Use Efficiency (ml/mt grain) Year

Pesticide Use Efficiency of Yellow Corn by Seed Technology.

Yellow Corn (National) Bt GM (Bt, HT and Bt/HT) Average Ordinary Hybrid National: 51% ↑ EFF in 11 Years Bt: 88% ↑ EFF in 8 Years Ordinary Hybrid: 83% ↑ EFF in 8 Years

54% Bt vs OH

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EMPIRICAL FINDINGS

• A. Impacts of Bt Corn 2003-2011

Macroeconomic impacts

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EMPIRICAL FINDINGS

A.3 Macroeconomic impact

• Estimated incremental difference

between GM corn and OH corn at the national level.

• Aggregate farm income
• Preharvest labor savings
• Incremental income from seed and

fertilizer sales

• Postharvest labor income multiplier

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EMPIRICAL FINDINGS

A.3 Macroeconomic impact

• The total macroeconomic effects of

GM corn (combined Bt, HT and Bt/HT) was P17,178 million or US$399.5 million in 2011.

• The effects of Bt corn was only P221

million or US$ P5.1 million, equivalent to only one percent of total.

• This was primarily due to low area

planted to Bt corn (2% of total GM) in 2011.

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Bt HT Bt/HT Total of Three GM Corn Incremental Net Farm Income Preharvest Labor Savings Incremental Income from Seed Sales Incremental Income from Fertilizer Sales Postharvest Labor Income Multiplier TOTAL OF ALL FIVE INDICATORS 221 1,726 15,231 17,178 33 535 2,848 3,416 22 134 1,177 1,333 12 117 645 774 69 502 4,139 4,710 Indicator Macroeconomic Effects in Million Peso GM Corn vs OH Corn 85 438 6,422 6,945

Macroeconomic Effects of GM Corn.

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CONCLUSIONS

• Ten years of GM corn

commercialization, particularly Bt corn adoption, in the Philippines indicated positive microeconomic farm level impacts, environmental impacts, and macroeconomic effects.

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RECOMMENDATIONS

• 1. Create a multidisciplinary team of

independent monitors to evaluate the socio-economic, environmental and aggregate macroeconomic impacts of GM corn.

• Should be composed of:
• experts in agriculture, environment and

social sciences

• corn farmers
• users of GM corn products

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RECOMMENDATIONS

• 2. Establish strategic alliances among

stakeholders that can support an agri-biotechnology development policy framework advocating for the following:

• Soft infrastructures:
• technical extension services
• sustainable credit schemes

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RECOMMENDATIONS

• Hard infrastructures:
• Farm-to-market roads
• Irrigation systems
• Postharvest, processing and trading

facilities ( e.g. multistage processing system for corn grains)

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• Enhancement of public research

expenditure on agri-biotechnology and strategic homegrown GM products.

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RECOMMENDATIONS

3. Fast track the adoption of GM corn technologies to enhance global competitiveness in the ASEAN and ASEAN +3 markets. This should be reflected in the Philippine yellow corn industry road map.

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200,000 400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Area Planted (ha)

3.A Trends in Area Harvested to Non-GM Yellow Corn and GM Yellow Corn.

Non-GM Yellow Corn GM Yellow Corn 1995: 1.02 M ha 2000: 0.94 M ha 2005: 0.95 M ha 2010: 1.16 M ha 2013: 1.28 M ha

Note: In 2013, Total Corn Area Harvested: 2.56 M ha White: 1.28 M ha Yellow: 1.28 M ha

Source of basic data: SIKAP/STRIVE, Inc. Corn Survey, 2004, 2005, 2008 and 2012; BAS Secondary Data on Yellow Corn, 2013.

100% 95% 5% 53% 47% 43% 57%

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1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Corn Production (mt)

3.B Trends in Production of Non-GM Yellow Corn and GM Yellow Corn*.

Non-GM Yellow Corn GM Yellow Corn 1995: 2.27 M mt 2000: 2.62 M mt 2005: 3.00 M mt 2010: 4.21 M mt 2013: 5.25 M mt 100% 93% 7% 37% 63% 33% 67% 100% * GM corn production projected estimates using socio- economic surveys of SIKAP/STRIVE, Inc.

Note: In 2013, Total Corn Production: 7.38 M mt White: 2.13 M mt Yellow: 5.25 M mt

Source of basic data: SIKAP/STRIVE, Inc. Corn Survey, 2004, 2005, 2008 and 2012; BAS Secondary Data on Yellow Corn, 2013.

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500,000 1,000,000 1,500,000 2,000,000 2,500,000 3,000,000 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Area Planted (ha)

3.C Trends in Area Harvested to White Corn, Non-GM Yellow Corn and GM Yellow Corn.

White Corn Non-GM Yellow Corn GM Yellow Corn 2005: 2.44 M ha 2010: 2.50 M ha 2013: 2.56 M ha

Note: In 2013, Total Corn Area Harvested: 2.56 M ha White: 1.28 M ha Yellow: 1.28 M ha

Source of basic data: SIKAP/STRIVE, Inc. Corn Survey, 2004, 2005, 2008 and 2012; BAS Secondary Data on Yellow and White Corn, 2013.

61% 2% 54% 22% 50% 22% 37% 25% 28%

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1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 8,000,000 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Corn Production (mt)

• 3. D Trends in Production of White Corn, Non-GM

Yellow Corn and GM Yellow Corn*.

White Corn Non-GM Yellow Corn GM Yellow Corn 2005: 5.25 M mt 2010: 6.38 M mt 2013: 7.38 M mt 53% 4% 24% 42% 29% 23% * GM corn production projected estimates using socio- economic surveys of SIKAP/STRIVE, Inc.

Note: In 2013, Total Corn Production: 7.38 M mt White: 2.13 M mt Yellow: 5.25 M mt

Source of basic data: SIKAP/STRIVE, Inc. Corn Survey, 2004, 2005, 2008 and 2012; BAS Secondary Data on Yellow Corn, 2013.

43% 34% 48%

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RECOMMENDATIONS

4. Develop strategic linkages in GM corn communities with livestock-poultry production areas

• Establishments of “Model Integrated

Feed Corn-Livestock and Poultry Farms”

• This will be consistent with the

implementation of the ASEAN Economic Community (AEC)

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RECOMMENDATIONS

5. Advocate for quality standards for corn

• Need to produce high quality corn

with aflatoxin levels of less than 20 parts per billion (ppb) – making it a Class A quality food-feed grain

• Need for BAFPS and NFA to adopt

quality corn standards

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HAVE A NICE DAY!

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