Author: Enemona Greg Ademu (Mr.)
Using the European Union GRACE Project (2012-2015), this article seeks to address the following draft questions on the safety of genetically modified crops and derived products as well as its socio-economic impacts.
- GRACE? (GMOs Risk Assessment and Communication of Evidence)
- Impact of GMO crops on the following:
- Farm Level Economics
- Economics of Co-existence
- Effects that the commercialization of GMO crops would have on the supply chain structure.
- Consumer acceptance of GMO crops.
- Environmental and economic impact of GMO crops.
- Impact of GMO on food security.
(1) GMOs Risk Assessment and Communication of Evidence (GRACE)
GRACE is an acronym for GMOs Risk Assessment and Communication of Evidence. It was a research project funded by the European Union’s Seventh (7 th) framework programme from 2012-2015. Eighteen (18) research institutions from thirteen (13) countries were involved in the project.
GRACE pursued two (2) key research objectives:
- To provide comprehensive reviews of the existing evidence on the health, environmental and socio-economic impacts of genetically modified plants (considering both risks and possible benefits).
- To evaluate animal feeding trials (90-day, 1-year) and alternative methods for use in GMO risk assessment.
- Building up a comprehensive and quality access database on genetically modified plants.
- Involving stakeholders in research planning and drawing of conclusions.
- Communication and dissemination of information.
- Systematic Reviews.
- Evidence Maps.
The EU GMO Project (2012-2015) showed that socio-economic factors influence farmer decisions to adopt GM crops. The potential income-related impacts include changes in the use of inputs, associated costs, output quantity and quality, and gross income. Also, some farmers could experience changes in time availability for conducting additional income generating off-farm activities making them more or less efficient, which will influence the income of the farmer.
The specific impact(s) of GM crops on farm-level economics are stated below:
Pros:
- Herbicide Tolerant (HT) crops are tolerant to certain herbicides such as glyphosate which are more effective, less toxic, and usually cheaper than selective herbicides. Accordingly, farmers who adopt HT technology benefit in terms of lower herbicide expenditures.
- Bt crops produce proteins that are toxic to larvae of some insect species. Therefore, Bt is a pest-control agent that can be used as a substitute for chemical insecticide. As such, farmers who use small amounts of insecticides in their conventional crop in spite of high pest pressure will realize a sizable yield effect through Bt adoption.
- In terms of the crop yields, there is no significant difference between HT and conventional (organic) crops. Also, because HT crops are developed and commercialized by private companies, a technology fee is charged on seeds, which varies among crops as well as countries.
- In BT crops, yield effects will be more pronounced in developing countries than developed countries, because pest pressure is often higher in the tropics and subtropics.
(b) Impact of GMO Crops on Economics of Co-existence
Since only authorized GMOs can be cultivated in the European Union, one of the issues addressed by EU GMO Project (2012-2015) was the Economics of Co-existence associated with the mixture of GM and non-GM crops.
Therefore, the objectives of co-existence measures in areas where GMOs are cultivated are:
- To avoid unintended presence of GMOs in other products
- To prevent the potential economic loss and impact of the admixture of GM and non-GM crops (organic crops).
- Separation between GM and non-GM farms.
- Dual GM or non-GM farms.
- Operational, transaction, opportunity, and testing and remediation costs.
- GM adoption dynamics (rate of adoption, speed and stability of GM expansion).
- GM farmers would also directly influence the economic benefits of non-GM farmers (due to gene flow from GM to non-GM fields).
- The high degrees of complexity, uncertainty, and direct costs associated with these coexistence rules represent clear disincentives for EU farmers to adopt GM crops.
Thus, the EU GMO Project (2012-2015) concluded that:
“Under certain economic and natural conditions, Member States (that is, EU countries) should consider the possibility to exclude GMO cultivation from large areas of their territory to avoid the unintended presence of GMOs in conventional and organic crops.”
(3) Effects that the Commercializations of GMO Crops would have on the Supply Chain Structure
The supply chain structure of every market is made up of:
- Vertical relations- Reflecting the relationships (buying and selling) among actors performing different functions in the supply chain.
- Horizontal relations- Reflecting the relationships (Co-operatives and Associations) among actors performing the same functions in the supply chain.
- Efficiency- Ability to deliver value with the minimum of total costs.
- Effectiveness- Ability of the chain to provide superior value.
- Innovation- Ability to respond to changes in consumer demand or external environment.
- The EU established a mandatory system of labeling GM products which is more costly and can reinforce the notion to customers that GM products are inherently unsafe. Dissimilar approaches across countries (like the US) leads to problems in international trade.
- Most farmers in US ensure that the handling and transportation of GM and non-GM crops are carried out in wholly different supply chains.
(4) Consumer Acceptance of GMO Crops
Despite the great potentials of GM crops, consumer acceptance towards GM crops are often negative, and so remains an issue. According to the EU GMO Project (2012-2015), this is because consumer perceptions are often dominated by health, environmental, social, and ethical concerns. However, acceptance may increase when second-generation, quality-enhanced GM foods with combined agronomic and quality traits are introduced.
Studies have also shown that the willingness to pay (WTP) for GM foods is significantly higher in Europe than in the United States (if these products are offered at significant cost savings over non-GM foods) and it is significantly lower for processed than for fresh GM foods (Lusk et.al, 2005). Individual analysis also showed a significant influence of consumer characteristics such as age, education, income, or gender, but the direction of the influence is not uniform.
Therefore, consumer acceptance of GM products will become a vital factor on how prosperous the market for GM foods will be in the future especially in terms of private and public investments.
(5) Environmental and Economic Impact of GM Crops
Environmental Impact
- Toxicity: This is a huge issue surrounding chemical pesticides and herbicides, used commonly with GMOs, in addition to the toxicity inherent to GM crops. GMOs may be toxic to non-target organisms such as bees and butterflies. These insects are hugely important in the pollination of many food crops.
However, adoption of GM crops resulted in significant pesticide and herbicide use which is of huge benefit to farmers.
- Biodiversity: Biodiversity is also put at risk by GMOs. When GM crops are planted, generally in a mono-crop fashion, many heritage seeds are no longer used. The nature of GMOs means fewer weed flowers and, therefore, less nectar for pollinators. Toxins released into the soil through the plants´ routes mean fewer soil bacteria, which are integral to healthy soil for plants to grow without the use of chemical fertilizers.
- Ecological Shifts: Evidence also suggests that small genetic changes in plants may produce even larger ecological shifts, meaning that there is potential for GMO´s to become persistent and weedy in agricultural conditions, since they are modified to be resistant to some modern agricultural techniques. This can also mean being invasive in natural settings.
Economic Impact
- Farm Level: As explained above, the EU GMO Project (2012-2015) showed that socio-economic factors influence farmer decisions to adopt GM crops. The potential income-related impacts include changes in the use of inputs, associated costs, output quantity and quality, and gross income. Also, some farmers could experience changes in time availability for conducting additional income generating off-farm activities making them more or less efficient.
- Consumer Level: The pricing of GM foods at the consumer level can vary a great deal. In some instances, prices are higher while other times they can be lower, which reflect the complex array of factors influencing GM food pricing as well as the impact of various production levels. For consumers against GM foods, they can expect to spend more if they choose organic products.
- Global Level: At the global level, GM technology has had a significant positive impact on farm income. In 2012, it was reported that the direct global farm income benefit was $18.8 billion (Brookes, 2014). This is equivalent to having added 6% to the value of global production of the four main crops of soybeans, maize, canola, and cotton.
(6) GMO Crops and Food Security
The Food and Agricultural Organization (FAO) defines food security as when all people at all times have physical and economic access to sufficient, sage and nutritious food to meet their dietary needs and food preferences for an active and healthy life. Unfortunately, food security is absent for a large number of the world’s population.
Thus, there are three possible pathways how GM crops could impact food security.
(i) GM crops could contribute to food production increases and thus improve the availability of food at global and local levels:
GM technologies could make food crops higher yielding and more robust to biotic and abiotic stresses (Tester, 2010). This would definitely increase food supplies against the background of increasing food demand and global warming.
(ii) GM crops could affect food safety and food quality:
GM food crops with higher contents of micronutrients such as Golden Rice with provitamin A in the grain could reduce nutritional deficiencies among the poor, hence, improving food quality (Qaim, 2013). Also, GM crops can be associated with food safety risks, which have to be assessed and managed case by case.
(iii) GM crops could influence the economic and social situation of farmers:
GM crops can improve or worsen farmer’s economic access to food. This is of great importance given the fact that an estimated 50% of all undernourished people are small-scale farmers in developing countries. The EU GMO Project (2012-2015) showed that Bt cotton adoption reduces chemical pesticide use and increases yields in farmers’ fields.
References:
Brookes (2014). Economic impact of GM crops: The global income and production effects 1996-2012. GM Crops & Food. 2014;5(1):65-75.
European Union GMO Project (2012-2015). GMOs Risk Assessment and Communication of Evidence (GRACE).
GRACE- Reviews of Human and Animal Health Impacts of GM Plants- Conceptual Model and Review Questions. Draft Document for Stakeholder Consultation. FP7 Collaborative Project. GRACE 311957.
GRACE- Reviews of Socioeconomic Impacts of GM Plants- Conceptual Model and Review Questions. Draft Document for Stakeholder Consultation. FP7 Collaborative Project. GRACE 311957.
Lusk et.al (2005). A Meta-Analysis of Genetically Modified Food Valuation Studies. Journal of Agricultural and Resource Economics. Vol. 30, No. 1 (April 2005), pp. 28-44.
Qaim (2013). Genetically Modified Crops and Food Security. Alvarez ML, ed. PLoS ONE. 2013;8(6).
Tester (2010) Breeding technologies to increase crop production in a changing world. Science 327: 818-822.
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