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Improved Economics


Farmers from eight countries discuss how agricultural biotechnology is improving the economics of their family farms by increasing their incomes through higher yields and lower production costs — including fewer pesticide applications and the more efficient use of farm labor.  Research indicates these economic benefits are realized by small- and large-scale family farms alike, resulting in an increase in net incomes of US$34 billion since 1996.
Since 1996 farmers have increased their net income by US$27 billion growing biotech.
Since 1996 farmers have increased their net income by US$27 billion growing biotech.
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HIGHER YIELDS AND LOWER PRODUCTION COSTS IMPROVE FARM ECONOMICS
Increased Net Income of US$34 Billion Between 1996 and 2006 Benefits Family Farms

Small- and large-scale family farms worldwide are benefiting from increased yields, reduced production costs, or both in some instances to create significantly improved net economic returns as a result of the adoption of agricultural biotechnology.  These benefits resulted in increased net income of US$34 billion between 1996 and 2006, according to a study conducted by Brookes and Barfoot of PG Economics.

For example, South African smallholder biotech cotton farmers in the Makhatini are increasing yields and net economic returns by US$10 to $20 per acre (US$25 to $51 per hectare) through agricultural biotechnology, according to a 2002 study.  Reductions in production costs are often attributed to making fewer pesticide applications and the more efficient use of farm labor.

“The Bollgard is a little bit expensive than conventional. … but at the end of the day, we save,” says Thandiwe Myeni, a South African grower discussing the farm economics of GM crops.  “Firstly, the spraying process, you save a lot of money of buying chemicals, of getting someone to help you in the field with spraying … you save.”

In India, farmers who planted Bt (insect-protected) cotton realized 45 percent to 63 percent higher yields in 2002-2003, according to a 2004 study.  “Before Bollgard, in the traditional seeds of cotton, our expenses were high and yield was low,” says Vitthal Patil, an Indian cotton farmer.  “But, with the introduction of Bollgard, we are safe from the havoc of the bollworms, which would affect 30 percent of the yield.”

In the Philippines, more than 125,000 family farms — typically 2.5 to 12 acres (1 to 5 hectares) — are growing 625,000 acres (250,000 hectares) of biotech corn and enjoying the benefits of higher incomes.  “In general, with better incomes, corn farmers are not only able to send their children to school, their overall standard of living has also improved,” says Filipino farmer Jesus Gavino.  “Also, some of our farmers were able to build an extension for their house. … So other than just generating income, they are also able to acquire assets that can help them improve their standard of living.”

Some of the increase in revenue — particularly in industrialized countries — can be attributed to management options made possible by agricultural biotechnology, such as earlier seeding and delayed harvest.  “With the Bt hybrids and the new genetics, we’re being able to get corn drier in the fields.  So we do less damage in the dryer.  And that has saved us a significant amount of money,” says U.S. corn and soybean grower Gordon Wassenaar.  

Editor’s Notes: Bollgard® cotton contains a protein from Bacillus thuringiensis (Bt) that protects cotton plants from specific lepidopteron insect pests. Bollgard® is a registered trademark of Monsanto Company.

© 2005 Monsanto Company.   All rights reserved.  The copyright holder consents to the use of this material and the images in the published context only and solely for the purpose of promoting the benefits of agricultural biotechnology.

Video Transcript



Since 1996, farmers have increased their net incomes by $27 billion growing biotech crops.

Al Skogen, United States
… We saw our production costs go down and our yields go up.

Terry Wanzek, United States
The five best years I’ve ever had farming are the past five or six. And I … would most directly credit biotechnology. It’s put money in our family’s bank account, and it’s helped us be more profitable on the farm.

Al Skogen
… I think it was just really one of the great technologies that we were — have been able to use.

Vitthal Narayan Patil, India
Before Bollgard, in the traditional seeds of cotton, our expenses were high and yield was low. But, with the introduction of Bollgard, we are safe from the havoc of the bollworms, which would affect 30 percent of the yield.

Lorne Hamblin, Canada
… what biotech I think does for the next generation is — is it’s — is gonna sustain their farm and probably make them viable.

Gordon Wassenaar, United States
… with the Bt hybrids and the new genetics, we’re being able to get corn drier in the fields. So we do less damage in the dryer. And that has saved us a significant amount of money …

Thandiwe Myeni, South Africa
The Bollgard is a little bit expensive than conventional. … but at the end of the day, we save. Firstly, the spraying process, you save a lot of money of buying chemicals, of getting someone to help you in the field with spraying … you save.

Art Enns, Canada
So now, with the new biotechnology, we’ve been able to reduce our spraying — a lot of times to just one pass and been able to control the weeds very effectively. So for me, yes, it does save us some money.

Jesus Gavino, Philippines
Of course, we are very happy since having used YieldGard. … Especially for farming couples who still have children in school, YieldGard is a big help because it will increase their income as their harvests increase. …

In general, with better incomes, corn farmers are not only able to send their children to school, their overall standard of living has also improved. Also, some of our farmers were able to build an extension for their house. … So other than just generating income, they are also able to acquire assets that can help them improve their standard of living.

Rodolfo Tosar, Argentina
Without a doubt, everything that has to do with adoption of technology has allowed us to have a little bit more profit nowadays, to survive, let’s say.

Ismael Purroy, Spain
… it means a lot. Especially in the problem years, it means the difference between ending up with a good year or with a bad year. You can be a bit more confident about what the production is going to be like. …

And that means having security within the family. … And farming also is something that has influence, above all, on our kids. Because they see that being a farmer is something that is profitable. That you can live from, and that you can enjoy, being a farmer.

Editor’s Notes: Bollgard® cotton and YieldGard® corn hybrids contain a protein from Bacillus thuringiensis (Bt) that protects the plants from specific lepidopteron insect pests. Bollgard® cotton and YieldGard® are registered trademarks of Monsanto Company.

© 2005 Monsanto Company.   All rights reserved.  The copyright holder consents to the use of this material and the images in the published context only and solely for the purpose of promoting the benefits of agricultural biotechnology.