Bt Cotton

Other countries growing Bt cotton

In the state of Coahuila and Durango in Mexico, Bt cotton generated an estimated $2.7 million in economic benefits annually in 1997 and 1998, of which the vast majority (85%) flowed to the farmers (Traxler et al 2001). In Mexico, when pest infestations were low in 1997, the overall economic advantage was $44/hectare compared with $626/hectare in 1998 when pest infestation was higher. The higher yield of Bt cotton in 1998 was the major contributor ($543/hectare) to the overall economic advantage of $626/hectare; yield of Bt cotton in 1998 was 20% higher, as opposed to 3% in 1997. In 1998 cost savings for insecticide were $139/hectare which were offset by higher Bt cotton seed cost of $56/hectare, resulting in an overall economic advantage for Bt cotton of $626 per hectare.

In South Africa, Ismael et al (2002a,b) have completed three years of study on the impact of Bt cotton on smallholder farmers in the Makhathini Flats. Yield advantages for Bt cotton, coupled with insecticide and labor savings which are partly offset by higher seed costs, result in an overall economic advantage of the order of $50/hectare for small Bt cotton farmers in the Makhathini Flats (ISAAA 2002d). Other estimates that exclude labor savings (Kirsten et al 2002) indicate an economic advantage of $35/hectare for small farmers, and ranging from $19 to $34/hectare for large farmers under rainfed and irrigated conditions respectively. Bt cotton growers in South Africa have benefited from higher yields than non-adopters and significantly lower chemical application costs. These benefits outweighed the increased seed and harvest costs of Bt cotton, creating higher gross margins and a net economic advantage for Bt cotton growers of about $25-$50 per hectare. The adoption rate for Bt cotton by small farmers in the Makhathini Flats has been very rapid, increasing from 4% of the growers in 1998 to 92 % in 2001. The majority of the adopters had farm sizes of less than three hectares, farming on average 1.7 hectares of cotton, once again clearly demonstrating that smallholder farmers can realize the economic benefits of Bt cotton.

In Argentina gross margins have been modest and variable, ranging from $5 to $36/ hectare (Qaim and de Janvry 2002) to $65/hectare (Elena 2001). Given the low-cost system of cotton production in Argentina, Qaim and de Janvry concluded that the relatively high price of Bt cotton seed ($103/hectare) is an impediment to higher adoption rates which have stagnated at about 5% of the national cotton hectarage. Lower prices for Bt cotton seed could stimulate adoption rates and improve margins for farmers as well as optimizing returns for the developers of the technology.

In Australia, overall economic benefits of Bt cotton have been low to modest and ranged from $6/hectare in 1998/99 to $50/hectare in 1999/00 (Fitt 2002/In Press). The principal ‘economic gain’ of Bt cotton is related to the fact that farmers are not required to operate an intensive spray control program throughout the season, with its associated negative effects on the implementation of the IPM program, which is assigned high priority. Despite only modest returns from Bt cotton, farmers have purchased the full quota of Bt cotton seed available each year because they are convinced of its environmental benefits and that it provides a foundation for a sustainable IPM strategy. In Indonesia, preliminary evaluations of Bt cotton indicate that farmer income increases due to higher yields (30% average), reduced pesticide usage and better productivity (ISAAA 2002e).

The positive experience of eight countries which are already benefiting from Bt cotton would suggest that farmers in other countries, suffering losses from the major lepidopteran pests of cotton could also realize significant economic benefits from growing Bt cotton. In summary, the seven countries that have adopted Bt cotton have realized significant economic gain, with India probably poised to realize similar benefits from 2002 onwards. The USA and China have been the largest absolute beneficiaries to date because they grew 60% and 35% of global Bt cotton in 2001 respectively. The national benefits associated with Bt cotton in China were by far the largest, increasing from $140 million in 1999, to $495 million in 2000, to $750 million in 2001, for a three year total of $1.385 billion (Table 58). National benefits associated with Bt cotton in the USA were $92 million in 1998, $99 million in 1999, (2000 estimate not available) and $103 million in 2001, when infestation was very low, for a three year total of $294 million. Benefits for the other 5 countries that have adopted Bt cotton during the period 1998 to 2001 are estimated at $11 million – the total area planted in the six countries to Bt cotton is modest but growing. Thus, the global benefits for Bt cotton during the period 1998 to 2001 is estimated at approximately $1.7 billion (Table 58), which is a substantial benefit. It is particularly impressive given the fact that over three quarters of the benefits in 2001 have been realized by up to 5 million small resource-poor farmers in developing countries, mainly in China, which elected to make its own investments in the technology and is now reaping the benefits.

Summary topics:

• Agronomic Benefits
• Environmental Benefits
  • Reduction in use of cotton insecticides
  • Less insecticides in aquifers and the environment
  • Farmer exposure to insecticide and health implications
  • Reduced production risks and enhanced opportunities to grow Bt cotton
  • Increased populations of beneficial insects
  • Reduced risk for wildlife
  • Reduced fuel and raw material consumption, and pollution
• Social benefits
  • Social implications of saving water by reducing number of insecticide sprays
• Economic benefits
  • China
  • USA
  • India
  • Distribution of economic surplus to Bt cotton stakeholders

Related topics:

• The cotton crop
• Global distribution of cotton in developing and industrial countries, by area, production, consumption, imports, and exports
• Number of cotton farmers worldwide and size of farms
• Insect pests of cotton
• Crop losses due to insect pests of cotton and the cost of control
• Global insecticide usage on cotton
• The use of Bt genes in cotton
• Assessment of environmental risk and Insect Resistance Management (IRM) strategies
• Global adoption of Bt cotton
• Bt cotton experience to date
• Summary: Agronomic, Environmental, Social and Economic Benefits
• Future global potential for Bt cotton: opportunities and challenges
• Highlights

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