US sales of agricultural biotechnology products are projected to advance 5.8 percent annually to $2.8 billion in 2006. Over the same period, transgenic crop acreage will increase 1.8 percent per year to 102 million. Transgenic seeds and crops will continue to dominate sales, led by expanding demand for insect-protected and/or herbicide-tolerant corn and soybeans. Value of seed purchases will benefit from increasing use of high value-added stacked seed containing multiple agronomic traits.

In contrast to the double digit growth achieved during the mid-to-late 1990s, demand for agricultural biotechnology products will advance at a much slower pace over the next decade due to ongoing public concerns about the safety of GMO products; government and grain processor requirements that genetically modified crops be segregated from conventional varieties; and competition from conventionally bred herbicide-tolerant and insect-protected crops. These and other trends are presented in Agricultural Biotechnology, a new study from The Freedonia Group, Inc., a Cleveland-based industrial market research firm.

Three crops — soybeans, corn and cotton — will account for nearly all US demand for genetically modified (GM) seeds through 2006. Recombinant bovine somatotropin (rBST), Bt bioinsecticides and monoclonal antibody-based GM diagnostic kits will command the largest sales among other agricultural biotechnology products, but will provide limited growth opportunities compared to transgenic seeds and plants.

Overall sales gains generated by agricultural biotechnology products will accelerate after 2006, spurred by the introduction and increasing market penetration of new products such as transgenic wheat and rice seeds, transgenic plant and animal factories, porcine somatotropin, and DNA-based plant diagnostic tests.

Among major crops, transgenic corn is expected to fare the best based on increasing use in non-food applications and trends favoring the use of stacked seeds. Glyphosate-tolerant soybeans will generate expanding demand as the recent expiration of Monsanto’s ROUNDUP herbicide patent reduces the cost of treating these crops. Although decelerating due to increasing market saturation, growth in transgenic cotton will continue to rise moderately based on several advantages. Cotton is relatively difficult to cultivate and growers are willing to pay substantial premiums for insectprotected and/or herbicide-tolerant varieties. As a result, by 2011, almost 90 percent of the US cotton crop will be transgenic. Cotton will further benefit from the fact that it is not a foodstuff, thereby escaping much of the negative publicity directed at genetically modified foods derived from corn and soybeans.