Agriculture Reference
In-Depth Information
increased net returns (table 4). However, some studies of Bt corn show that
profitability is strongly dependent on pest infestation levels.
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The impact of
HT seeds (for corn, cotton, and soybeans) on net returns depends on many
factors.
Planting Bt cotton and Bt corn is often more profitable than planting
conventional seeds.
ERS researchers found that adoption of Bt cotton was
positively associated with net producer returns in 1997 (Fernandez-Cornejo
and McBride, 2002). Using 2005 ARMS data, Fernandez-Cornejo and
Wechsler (2012) found that a 10-percent increase in the probability of
adopting Bt corn was associated with a 1.7-percent increase in net returns. In a
new ERS analysis using 2010 ARMS data, we find that a 10-percent increase
in the probability of adopting Bt corn was associated with 2.3-percent increase
in net returns (table 6). Thus, there is essentially no change compared to earlier
findings that planting Bt cotton and Bt corn is more profitable, as measured by
net returns, than planting conventional seeds.
The effect of HT seeds on net returns depends on many factors.
A
primary advantage of herbicide-tolerant crops over traditional crops is cost
savings (Fernandez-Cornejo and McBride, 2002). Producers who plant HT
crops expect to achieve at least the same output while lowering weed control
costs for chemicals and for mechanical methods, and minimizing the need for
scouting. In return, producers pay more for HT seeds.
An additional economic effect is that the substitution of glyphosate, used
in most herbicide-tolerant programs, for other herbicides decreases the demand
for (and thus the price of) other herbicides (Fernandez-Cornejo and McBride,
2002). Thus, the introduction of HT seeds may have lowered pesticide costs
for both HT seed adopters and nonadopters.
Finally, HT seed-based production programs allow growers to use one
product to control a wide range of both broadleaf and grass weeds instead of
using several herbicides to achieve adequate weed control. Herbicide-tolerant
crops also complement ongoing trends toward post-emergence weed control,
the adoption of conservation tillage practices, and the use of narrow row
spacing. The simplicity and flexibility of weed control programs for HT seeds
require less management attention, freeing valuable management time for
other activities (Fernandez-Cornejo and McBride, 2002).
HT seed has a mixed effect on net returns.
The evidence on the impact of
HT seeds (for corn, cotton, and soybeans) on net returns is mixed (table 4).
Several researchers (Fernandez-Cornejo and McBride, 2002; Bernard et al.,
2004; Marra et al., 2002) found that the adoption of herbicidetolerant cotton
has a positive impact on net returns. For example, Fernandez-Cornejo and
