The market value of GM products

1. Biodesic, Seattle, Washington, USA.

Correspondence to: Rob Carlson¹ e-mail: rob@biodesic.com

Introduction

To the Editor:

I am writing to point out that the Data Page published in the March issue¹ substantially underestimates the market value of transgenic crops. Using a more accurate estimate dramatically changes the fraction of US gross domestic product (GDP) that can be attributed to genetically modified (GM) systems.

According to the International Service for the Acquisition of Agri-biotech Applications (ISAAA; New York), the data displayed in the upper left graph on p. 221 is explicitly from seeds and licensing revenues rather than from 'crops'², which have much greater market value. Worldwide farm-scale revenues from GM crops are difficult to assess directly, but good data are available for the United States. The Economic Research Service reports that 80–90% of all corn, soy, and cotton grown in the United States is transgenenic (http://www.ers.usda.gov/Data/BiotechCrops/), whereas the National Agriculture Statistics Service (NASS) reports total revenues for these crops at more than $110 billion (http://www.nass.usda.gov/Data_and_Statistics/Quick_Stats/index.asp).

Taken together, the reports enable an estimation of the revenues from the major GM crops at about $65 billion in 2008 (Fig. 1). The data demonstrate substantial fluctuations in revenues due to changes in annual prices, even as the fraction of GM crops planted continues to increase. The ISAAA reports that about half of all transgenic seeds were planted in the United States², and if one assumes that prices paid for crops in the United States are representative of global averages, then global farm-scale revenues from GM corn, soy and cotton in 2008 were about $130 billion.

Combining these adjusted crop revenue figures with contributions from GM drugs ('biologics') and GM industrial products (fuels, materials, enzymes) that I have previously estimated³ reveals that US revenues from GM products were $240 billion in 2007 and are growing at 15–20% annually. Given the predicted stagnant US GDP, which is estimated at about $14.3 trillion in 2008, revenues from GM systems could amount to the equivalent of about 2% of US GDP in 2009.