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Who profits from GMO technology?


The global market for genetically modified crops was estimated at $14.8 billion in 2012.

Studies differ on how this money is divvied up. One 2010 review estimated very roughly that somewhere around one-third of the total economic benefit of GM crop technology goes to seed and chemical companies. Another third accrues to US farmers. The remaining third is split between US consumers and the rest of the world:

Seed and chemical companies: Biotech companies have certainly profited from GM crops, not least because seeds and genetic innovations can be patented. Monsanto, for instance, can sell both Roundup herbicide and Roundup-resistant corn and soybeans to farmers, who must repurchase the seeds every year.

US farmers: Farmers typically have to pay more for genetically modified seeds. However, these new crop varieties can save them time and money in the long run — by, for instance, reducing the need for pesticides and soil tillage, or by reducing crop damage. There is some evidence that farmers who use GM crops receive a discount on crop insurance.

US consumers: In theory, GM crops should help reduce food prices if they cut costs for farmers or help boost the food supply. So far, this effect appears to be modest: the National Research Council estimated in 2010 that GM crops have lowered commodity prices by 2 percent.

Developing countries: Estimates on the costs and benefits of GM foods in the developing world tend to be hazy. One study by PG Economics estimated that GM crops raised incomes in developing countries by $7 billion in 2010, but this is hardly the last word on the subject.

The most common GM crop grown by small farmers in developing countries is Bt cotton engineered to be pest-resistant. Studies have found that some farmers do benefit from these crops, but the results tend to vary based on location and farm type.