Argentina
November 2011

Since its introduction in 1996, agricultural biotechnology generated 72.36 billion dollars and created 1.82 million jobs in Argentina. The advantages of early adoption and the challenges to stay on the top list.

Since 1996, when glyphosate‐tolerant soybean was introduced, Argentina has been one of the leading countries in the utilization of genetically modified (GM) crops, reaching 22.9 million hectares planted in the last growing season. The adoption process of these technologies has been fast and steady, with an unprecedented dynamics which allowed that GM varieties currently represent practically all the planted area with soybean, 86% in the case of maize and 99% for cotton.

According to a recent study carried out by Dr. Eduardo Trigo for ArgenBio ‐ the Argentine Council for Information and Development of Biotechnology – the gross benefit generated by this adoption process for the period 1996‐2010 reaches 72,363 million US dollars. These benefits were estimated using SIGMA, a mathematical model developed by INTA (National Institute for Agricultural Technology) that uses data from the Technological Profile of Argentina’s Agricultural Sector (INTA), with additional information provided by the Ministry of Agriculture, Livestock and Fisheries, ArgenBio, INDEC (National Institute of Statistics and Census) and FAO.

Economic benefits, by crop

• In the case of glyphosate‐tolerant soybean, the benefits mounted to 65,153 million US dollars, 3,231 million attributable to a reduction in production costs (mainly due to less tillage and reduced applications of selective herbicides required by conventional varieties) and 61,917 million due to the expansion of the planted area. Regarding the distribution of the total benefits, 72.3% went to farmers, 21.3% to the National Government– collected through export tax and other taxes – and 6.5% to technology providers (seeds and herbicides).
• In the case of maize, insect resistance and herbicide tolerance technologies gave benefits for a total amount of 5,375 million US dollars, distributed as follows: 68.2% to growers, 11.4% to the National Government and 20.4% to technology providers (mainly seeds).
• Finally, in the case of insect‐resistant and herbicide‐tolerant cotton, total benefits reached 1,834 million US dollars that went mainly to farmers (96%), with 4 % going to technology providers (seeds and herbicides).

More benefits

In addition, and given the importance of Argentine soybean production worldwide, this study estimated the global impact in terms of savings that the adoption of such technology by Argentine farmers has had on consumer expenditure (by reducing the global price). The total cumulative figure for 1996‐2011 was estimated at about US$ 89 billion. In terms of prices, figures show that if this adoption process had not occurred, the international price of soybean in 2011 would have been 14% higher than it actually was.

On the socio‐economic side, the impact that GM technologies have had on job creation was assessed. Based on these estimates, the generation of 1.82 million jobs by the Argentine economy along these 15 years could be attributed to the use of GM technologies.
Dr. Eduardo Trigo’s work also analyzed some environmental impacts related to GM crops, with special emphasis on the particular synergy between the expasion of these crops and no‐till farming practices, and its positive impact on soil structure and the efficient use of energy.

Future benefits.

Looking ahead and using the same methodology applied for the retrospective analysis, the study estimates the potential benefits that could be generated by two different types of GM crops: an herbicide tolerant and insect resistant soybean, and a drought‐resistant wheat, under three different price and adoption scenarios. Results show that, if these technologies were available as from the next growing season, accumulated benefits in the 10 following years could be 9,131 to 26,073 million US dollars for soybean and 526 to 1,923 million for wheat, according to the different scenarios.

“Argentina must remain a leader so as not to miss opportunities”

“One of the characteristics of the adoption process of GM crops in Argentina is the fact that our country has been an early adopter worldwide”, stated Eduardo Trigo, who explained that “the introduction of herbicide‐tolerant soybean in our agriculture was made available to farmers practically at the same time as in the American market for which it was originally designed. In these 15 years this has given us an important amount of economic and other benefits, as the study shows.”

“The advantages of being at the front of innovative processes are very clear and, as a consequence, so are the risks or opportunity costs that the country would face if it followed a less dynamic technology adoption process than in the past. Keeping the ¨early adopter¨ profile is a strategic issue that should include key topics like regulatory processes, the promotion of investments for the sector and the redistribution of benefits into areas like innovation, economic growth and social welfare”, said the author.

The key to success.

“The biotechnology adoption process in Argentine agriculture has been undoubtedly very successful”, said Gabriela Levitus, Executive Director of ArgenBio. “Not only because our products have been competitive and the international prices have been good, but also because when this technology was made available, the country was ready to adopt it. There were world class breeders, trained and innovative farmers and there was the political will that resulted in the creation of a pionner regulatory system, which guaranteed the safe adoption of GM crops in our country from the start.

This political will, very clear 15 years ago but quite changeable along the last years, is today strong again; this fact is clearly shown through the new approvals and the recent revision of the regulatory processes boosted by the Ministry of Agriculture, Livestock and Fisheries. Contrary to other times, agricultural biotechnology is now a state policy”, concluded Levitus.

About the author:
Dr. Eduardo Trigo is a senior independent Researcher with the Forges Foundation and CEO Group, both institutions dedicated to research and counseling for the agricultural sector.

15 Years of Genetically Modified Crops in Argentine Agriculture
Eduardo J. Trigo ‐ 2011

EXECUTIVE SUMMARY

Argentina is one of the leading countries in the use of genetically modified crops in agriculture, with more than 22 million hectares dedicated to soybean, maize and cotton crops using this type of technologies. The process of adoption of GM technologies began in 1996 with the introduction of glyphosate herbicide‐tolerant soybean, and it has continued uninterruptedly, with an almost unprecedented dynamic adoption rate at world scale that has made such type of technologies to be now used in nearly all soybean crops, in 86% of maize crops, and 99% of cotton crops. This process has implied cumulative gross earnings for Argentina amounting to US$ 72,645.52 million. Out of such total figure, US$ 65,435.81 million accounted for herbicide‐tolerant soybean, US$ 5,375 million to (Bt) insect‐resistant and herbicide‐tolerant maize (single and combined events) and US$ 1,834 million to insect‐resistant and herbicide‐tolerant cotton (single and combined events).

Additionally to the above‐mentioned earnings, it has also been estimated the impact that GM technologies have had in terms of job creation, between the time of their introduction and the last crop season (2010/2011). According to estimates made within the 15‐year period after their adoption, total jobs created by the Argentine economy that could be attributed to such technologies would be over 1.8 million.

The above‐mentioned earnings have been estimated on the basis of a mathematical model developed by INTA (SIGMA), which uses information obtained from the Technological Profile Study of the Argentine Agricultural Sector, supplemented by information from MAGyP, ArgenBio, INDEC and FAO. The model facilitates the calculation of gross earnings, as well as the manner in which these profits have been distributed among the various productive players and the Government. In this respect, in the case of herbicide‐tolerant soybean, the gross value of earnings obtained from cost reduction was US$ 3,518.66 million, and from arable land expansion it was US$ 61,917.15 million. As regards distribution of such earnings, 72.4% went to farmers, 21.2% to the National Government –through withholding taxes and other duties‐, and the remaining 6.4% to technology providers (seeds and herbicides, distributed approximately in equal shares.) In the case of maize, cumulative earnings were distributed as follows: 68.2% to farmers, 11.4% to the National Government, and 20.4% to technology providers (with a bulk of 19% to the seed sector). Finally, in the case of cotton, earnings largely went to farmers (96%), with 4% being distributed to technology providers (3% to seed suppliers and the rest to agrochemical suppliers.)

Given the importance of Argentine soybean production worldwide, using the same information as the one generated for the economic impact analysis concerning Argentina, it has been estimated the global impact in terms of savings that the adoption of such technology by Argentine farmers has had on consumer expenditure (by reducing the global price.) The total cumulative figure for the period 1996‐2011 was estimated at about US$ 89 billion which, added to the cumulative gross earnings in Argentina (US$ 65 billion), would result in a total herbicide‐tolerant soybean earnings of about US$ 154 billion. In terms of prices, the estimated figures show that if this adoption process had not occurred, the international price of soybean in 2011 would have been 14% higher than it actually was.

This paper is divided into five chapters. Chapter 1, designed to be an introduction, summarizes the highlights on the process of introduction of genetically‐modified crops in Argentine agriculture, through the history of approvals for field trials and commercial plantings, the composition (by crop and trait), and their origin, as well as the adoption dynamics compared to other technologies of significance at national and international level.

Chapter 2 represents the core part of this study, containing the economic impact analysis mentioned above. On the other hand, using the same methodology as the one used for the retrospective analysis, Chapter 3 shows an estimate of the potential future earnings that could be generated from the commercial cultivation of an herbicide‐tolerant and insect‐resistant soybean (combined traits) and a drought‐tolerant wheat, for three possible scenarios relating to prices and GM technology adoption. Results shows that, if such technologies were released as from the next crop season, cumulative earnings in the following ten years would amount to US$ 9,131‐26,073 million in the case of soybean, and US$ 526‐1,923 million in the case of wheat, depending on the different scenarios.

Chapter 4 analyzes some environmental impacts related to the new technologies, laying emphasis on the particular existing synergy between the expansion of GM varieties and the practice of no‐till farming, as well as the positive impact of the latter on the soil structure and energy efficiency of agricultural tasks. These practices have led to a 38% reduction in fuel consumption for such crops, as well as a substantial reduction in the use of residual herbicides, which meant a significant positive impact on environmental concerns. However, these practices have also raised many questions such as, for example, those associated with the expansion of soybean monoculture and the implication of such circumstance in terms of “export” of soil nutrients, and the advance of agriculture towards new areas with more “fragile” resources out of the Pampas region. All these aspects are very important and they should be monitored, but there is no doubt that the herbicide‐tolerant + no‐till farming package is a compelling alternative regarding the previous situation, even though it cannot solve by itself all the sustainability problems that are implied in the process of agricultural enhancement.

Finally, Chapter 5, designed to be a conclusion, poses the challenge to hold one’s position as early adopter. Stemming from the information presented throughout this paper, there is a description of the advantages taken by Argentina for having made the most, almost in conjunction with the American market, of the benefits of using a novel technology. Therefore, one can clearly notice the advantages of being at the forefront of such type of innovative processes and, additionally, of the risks –or opportunity costs‐ that may affect Argentina if a process of technology adoption in the future were less dynamic than it has been in the past. Drifting apart from the innovation frontier may have disturbing consequences for Argentina, perhaps of a much more serious nature in the future than the impact that the country may have suffered in the past. Therefore, preserving the early adopter status may seem to be a strategic matter of discussion, where it should be appropriate to include issues such as developing mechanisms for commercial releases, promoting investments in the agricultural sector, and redistributing earnings in the areas of innovation, economic growth and welfare assistance.

Impacto económico de 15 años de cultivos transgénicos en Argentina: la biotecnología agrícola le dejó al país más de 70 mil millones de dólares

Desde su introducción en 1996, la biotecnología agrícola le reportó al país 72.645 millones de dólares y generó más de 1,8 millones de empleos. La ventaja de haber empezado temprano y el desafío de mantenerse entre los primeros.

Desde 1996, año de la introducción de la soja tolerante al herbicida glifosato, Argentina ha sido líder en la utilización de cultivos genéticamente modificados (GM), alcanzando las 22,9 millones de hectáreas en la última campaña agrícola. El proceso de incorporación de estas tecnologías ha sido rápido y continuo, con una dinámica de adopción sin precedentes a nivel mundial, y que ha llevado a que las variedades GM hoy representen casi la totalidad del área cultivada con soja, el 86% del área total de maíz y el 99% del área de algodón.

Según un trabajo realizado por el Dr. Eduardo Trigo para el Consejo Argentino para la Información y el Desarrollo de la Biotecnología, ArgenBio, este proceso de adopción le ha reportado al país, a lo largo del período 1996‐2010, un beneficio bruto acumulado de 72.645,52 millones de dólares. Estos beneficios se estimaron usando un modelo matemático desarrollado por el INTA (SIGMA), que emplea datos del Estudio del Perfil Tecnológico del Sector Agropecuario Argentino (INTA), complementado con información del Ministerio de Agricultura, Ganadería y Pesca de la Nación, ArgenBio, el INDEC y la FAO.

Los beneficios económicos, por cultivo.

• En el caso de la soja tolerante al herbicida glifosato, los beneficios sumaron 65.435,81 millones de dólares, de los cuales 3.518,66 millones se debieron a la reducción de costos (principalmente por reducción de labores y de la aplicación de herbicidas selectivos que requiere la soja convencional) y 61.917,15 millones a la expansión del área cultivada. En cuanto a la distribución de los beneficios totales, 72,4% fue a los productores, 21,2 al estado nacional – a través de las retenciones y otros impuestos ‐ y 6,4% a los proveedores de tecnologías (semillas y herbicidas).
• En el caso del maíz, las tecnologías de resistencia a insectos y tolerancia a herbicida aportaron beneficios por un total de 5.375 millones de dólares, de los cuales 68,2% fueron para los productores, 11,4% para el estado nacional y 20,4% para los proveedores de tecnologías (principalmente semillas).
• Finalmente, los beneficios en el caso del algodón resistente a insectos y tolerante a herbicida fueron de 1.834 millones de dólares, y fueron mayoritariamente a los productores (96%), con un 4 % para los proveedores de las tecnologías (semillas y herbicidas).

Más beneficios.

Dada la importancia del volumen de soja producido en Argentina en la producción mundial, el estudio calculó además el impacto que tuvo la adopción de esta tecnología por parte de los agricultores argentinos en el gasto de los consumidores a nivel mundial, en términos de ahorro, por disminución del precio internacional. En este sentido, el total acumulado para el periodo 1996‐2010 se estimó en unos 89.000 millones de dólares. En términos de precios, el análisis indica que si este proceso de adopción no hubiese ocurrido, el precio internacional de la soja, en 2011, hubiese sido un 14% mayor de lo que fue.

En el plano social, se estimó el impacto que las tecnologías GM han tenido en términos de generación de empleo. Según las estimaciones realizadas, en los 15 años desde su adopción, podrían atribuirse a esta tecnología más de 1,8 millones de empleos generados por la economía argentina.

El trabajo de Eduardo Trigo analiza también algunos impactos ambientales relacionados con los cultivos GM, haciendo énfasis en la particular sinergia que hay entre la expansión de estos cultivos y la práctica de la siembra directa, y el impacto positivo que ésta ha tenido en la estructura de los suelos y la eficiencia energética de las labores agrícolas.

Los beneficios de lo que se viene.

Mirando hacia adelante, y usando la misma metodología empleada para el análisis retrospectivo, el informe estima los potenciales beneficios que podrían generar el cultivo comercial de una soja con tolerancia a herbicida y resistencia a insectos y de un trigo tolerante a sequía, para tres escenarios posibles de precios y adopción. Los resultados indican que de contar con estas tecnologías a partir de la próxima campaña, los beneficios acumulados en los 10 años siguientes serían de 9.131 a 26.073 millones de dólares para la soja y 526 a 1.923 millones para el trigo, dependiendo de los diferentes escenarios.

“Argentina debe continuar a la vanguardia para no perder oportunidades”

“Una de las características del proceso de adopción de los cultivos GM en Argentina es el carácter de “adoptante temprano” que tuvo el país a nivel mundial”, señaló Eduardo Trigo, quien explicó que “la incorporación de la soja tolerante a herbicida a nuestra agricultura se dio casi al mismo tiempo que la tecnología se hacía disponible en el mercado norteamericano para el cual fue diseñada. Esto nos ha brindado, a lo largo de estos 15 años, un importante cúmulo de beneficios económicos y de otro tipo, tal como lo muestra este estudio.”

“Quedan claras las ventajas de estar a la vanguardia de los procesos innovativos, y por extensión, también los riesgos o costos de oportunidad que tendría para el país un proceso de incorporación de tecnologías menos dinámico del que se ha dado en el pasado. Continuar con el carácter de “adoptante temprano” es un tema estratégico de discusión en el que deberían incorporarse cuestiones clave como los procesos regulatorios, la promoción de las inversiones en el sector y la redistribución de los beneficios en áreas de innovación, crecimiento económico y bienestar social”, agregó el autor.

Las claves del éxito.

“El proceso de incorporación de la biotecnología a la agricultura argentina ha sido sin duda exitoso”, comentó Gabriela Levitus, Directora Ejecutiva de ArgenBio. “Más allá de la competitividad de nuestros cultivos y los buenos precios internacionales, una de las claves del éxito fue que cuando surgió la tecnología, el país estaba preparado para recibirla. Contaba con fitomejoradores de primera línea, productores capacitados e innovadores y voluntades políticas que se plasmaron en la creación de un marco regulatorio pionero que garantizó la adopción segura de los cultivos transgénicos en nuestro país. Estas voluntades políticas, claras al comienzo pero fluctuantes a lo largo de estos 15 años, hoy vuelven a consolidarse a través de las nuevas aprobaciones y los cambios en el proceso regulatorio impulsados desde el Ministerio de Agricultura, Ganadería y Pesca. A diferencia de otras épocas, la biotecnología agrícola es ahora una política de estado”, agregó Levitus.

Se puede acceder al trabajo completo en:
http://www.argenbio.org/adc/uploads/15_anos_Estudio_de_cultivos_GM_en_Argentina.pdf

Sobre el autor:
El Dr. Eduardo J. Trigo es investigador independiente miembro de FORGES y de Grupo CEO, entidades relacionadas a la investigación y el asesoramiento en el sector agropecuario. 

Website: http://www.argenbio.com

Published: November 29, 2011