Farm income and production impacts from the use of genetically modified (GM) crop technology 1996-2020

This paper updates previous estimates for the global value of using genetically modified (GM) crop technology in agriculture at the farm level. It examined impacts on yields, important variable costs of production, including the cost of the technology, direct farm (gross) income, and impacts on the production base of the main crops where the technology is used (soybeans, corn, cotton, and canola). Over the period 1996 to 2020, the economic benefits have been significant with farm incomes for those using the technology having increased by $261.3 billion US dollars. This equates to an average farm income gain across all GM crops grown in this period of about $112/hectare. In 2020, the farm income gains were $18.8 billion (average of $103/ha). The cumulative farm income gains have been divided 52% to farmers in developing countries and 48% to farmers in developed countries. Seventy-two percentage of the gains have derived from yield and production gains with the remaining 28% coming from cost savings. These yield and production gains have made important contributions to increasing global production levels of the four main crops, having, for example, added 330 million tonnes and 595 million tonnes respectively, to the global production of soybeans and maize since the introduction of the technology in the mid-1990s. In 2020, the extra global production of the four main crops in which GM technology is widely used (85 million tonnes), would have, if conventional production systems been used, required an additional 23.4 million ha of land to be planted to these crops. 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 $3.76 in extra income. In developing countries, the average return was $5.22 for each extra dollar invested in GM crop seed and in developed countries the average return was $3.00.

Automated summary

This paper provides updated estimates for the global value of using genetically modified (GM) crop technology in agriculture. It concludes that the technology has significantly increased farm incomes and global production levels of main crops. The economic benefits have been divided between farmers in developing and developed countries, with yield and production gains contributing the most to the overall income gains.