Give credit to the economics

Wednesday, August 1, 2012

Why is Bt corn so darn popular? Blame it on the economics, says a paper to be presented to the Agricultural and Applied Economics Association's annual meeting in Virginia this month.

The paper, prepared by Jorge Fernandez-Cornejo and Seth Wechsler of the U.S. Department of Agriculture's Economic Research Service in Washington, D.C., says that by 2011 Bt corn accounted for 65 per cent of U.S. corn acres. Observations in 19 corn-producing states in 2010 show that corn yields were 26 bushels per acre higher for adopters of that technology, compared to non-adopters.

There was no associated reduction in insecticide demand in 2010, as there had been in a similar 2001 study. Variable profits were US$118 higher for adopters than for non-adopters. "Insect infestation levels were lower in 2010 than they were in 2001 or in 2005." And producers, whether Bt corn users or not, were using less insecticides.  "However, our results suggest that Bt adoption is not significantly related to insecticide use. This result appears to be related to the fact that insect infestation levels were lower in 2010 than they were in earlier years," the study says. BF