1. Genetically Modified Crops/Foods: The Future of the World Agricultural Economy? C. Ford Runge, Ph.D. University of Minnesota April 15, 2005

2. Global analysis  Surveys the global diffusion of biotech crops at end of 2004  Four-part study – Analyzes global market adoption and commercial value – Summarizes historical R&D activity by crop and by country – 63 countries and 57 crops – Profiles country-level activity – Assesses tiers of country activity and spheres of biotech influence around the globe now and in the future  Approval and trial data based on data collected by UN FAO, World Bank, European Commission and other public databases

3. Scope of diffusion  Four stages of crop development – Commercial production – Regulatory approval processes – Field trials – Lab and greenhouse studies  Bottom line: plant biotech diffusion is rapid and widespread

4. Biotech goes global Identified 63 countries that have conducted biotech research on one or more of 57 food and fiber crops as of 2004

5. Wide range of crops 57 fruits, vegetables, field crops and other plants – ranging from lab trials to commercial production 14 Vegetables Broccoli Cabbage Carrot Cauliflower Cucumber Eggplant Lettuce Onion Pea/Bean Pepper Potato Spinach Squash Tomato 16 Fruits Apple Banana Cantaloupe Cherry Citrus Coconut Grape Kiwi Mango Melon Papaya Pineapple Plum Raspberry Strawberry Watermelon 16 Field Crops Alfalfa Barley Canola Cassava Clover Cotton Flax Maize Rice Safflower Sorghum Soybean Sugar Beet Sugar Cane Sunflower Wheat 11 other crops Chicory Cocoa Coffee Garlic Lupins Mustard Oil Palm Oilseed Poppy Olive Peanut Tobacco

6. Biotech value  Total market value of biotech crops in 2003-2004: $44 billion – Soybeans: $23.5 billion – Maize: $11.2 billion – Cotton: $7.8 billion – Canola: $1.4 billion

7. Biotech value  Five countries account for 98 percent of the value: – United States: $27.5 billion (maize, soy, cotton and canola) – Argentina: $8.9 billion (maize and soy) – China: $3.9 billion (cotton) – Canada: $2 billion (canola, maize and soy) – Brazil: $1.6 billion (soy)

8. Global R&D diffusion  R&D activity has been wider and much deeper than commercial adoption – Field crops: 16 in 55 countries – Vegetables: 14 in 50 countries – Fruits: 16 in 29 countries – Other crops: 11 in 29 countries

9. Potential to increase rapidly  Several crops could reach commercial production quickly, rapidly increasing adoption and value – Biotech soybeans or maize could be quickly implemented in China – If half of the 16.2 million and 114 million metric tons, respectively, were planted to biotech, global value of the crops would grow by $2.5 billion

10. Potential for developing countries  More than half of the 63 countries engaged in biotech R&D are in the developing world  Asia – China is aggressively engaged, investing hundreds of millions of dollars annually in research with huge market potential – India has at least 20 institutions involved in R&D  Latin America – Argentina and Brazil are rapid adopters and poised for further growth  Africa – South Africa has the capacity and resources to lead the continent in R&D and expanding crop acreage

11. Developed countries  Canada has produced, approved or field tested a wider variety of field crops than any other country  Australia has an active biotech sector, is growing biotech cotton and has import or other approval on seven major crops  U.S. remains the leading adopter and major center of R&D activity

12. The European situation  Pockets of European opposition have received disproportionate attention  R&D has been and remains active on a wide variety of crops  European Commission’s Joint Research Center reports 1,849 biotech field trials from 1991 to present  If regulatory framework is clarified, the EU can recover quickly from its dormant state

13. Tiers and spheres  Tier one: leaders – Major commercial adopters: U.S., Argentina, China, Canada, and Brazil – Other significant R&D activity: Australia, Western Europe, Mexico and South Africa  Tier two: emerging – Indonesia, Egypt and India – Limited by resources, regulation and technical capacity  Tier three – Rest of the world

14. Future trends: past is prologue  Major expansions in adoption and development still to come  Range of approvals will grow, creating new opportunities  Acreage expected to expand significantly, particularly in Asia, Latin America and Africa  North America, Western Europe, China, Argentina, Brazil, South Africa, Australia and India are centers of influence that will lead future development

15. Field Crops by Country

16. Vegetables by Country

17. Fruits by Country

18. Other Crops by Country

19. Global Biotech Crop Area: Leading Countries Five leading counties Area in biotech crop production Share of world biotech area biotech crop varieties: 67.5 million hectares98% United States Argentina Canada Brazil China 42.8 million hectares 13.9 million hectares 4.4 million hectares 3.0 million hectares 2.8 million hectares 63% 21% 6% 4% maize, cotton, soy, canola soy, maize, cotton canola, maize, soy soy cotton

20. Global Biotech Crop Value: Leading Countries 2003/04Biotech-related crop value* 2003/04Biotech-related crop value* Five countries:$43.9 billionFour crops:$43.9 billion United States$27.5 billionSoybean$23.5 billion Argentina$8.9 billionMaize$11.2 billion China$3.9 billionCotton$7.8 billion Canada$2.0 billionCanola$1.4 billion Brazil$1.6 billion

21. Global Biotech Soybean Value: Leading Countries Soybean 2003/04 price = $250/MT Crop area (1) M Ha Production (2) MMT Biotech adoption rate Biotech-related crop value (3) Five countries:74.2171.854%$23.5 billion United States29.265.881%$13.3 billion Brazil21.353.512%$1.6 billion Argentina14.034.098%$8.3 billion China8.716.2-- Canada1.12.350%$284 million Rest of the world13.818.3**

22. Global Biotech Maize Value: Leading Countries Maize 2003/04 price = $100/MT Crop area * M Ha Production ** MMT Biotech adoption rate Biotech-related crop value*** Five countries:68.5434.519%$11.2 billion United States28.8256.940%$10.3 billion China23.5114.0-- Brazil12.641.5-- Argentina2.112.540%$500 million Canada1.29.640%$384 million Rest of the world71.9179.5--

23. Global Biotech Cotton Value: Leading Countries Cotton 2003/04 price = $0.59/lb. Crop area * M Ha Production ** M Bales Biotech adoption rate Biotech-related crop value*** Five countries:11.246.761%$7.8 billion China5.122.462%$3.9 billion United States4.918.373%$3.8 billion Brazil1.05.7-- Argentina0.30.460%$75 million Canada---- Rest of the world21.446.8--

24. Global Biotech Canola Value: Leading Countries Canola 2003/04 price = $285/MT Crop area * M Ha Production ** MMT Biotech adoption rate Biotech-related crop value*** Five countries:12.618.828%$1.43 billion China7.511.4-- Canada4.76.768%$1.29 billion United States.4.773%$138 million Argentina---- Brazil---- Rest of the world13.420.2--