The International Consortium on Agricultural Biotechnology Research (ICABR)



Economic Analysis of Benefits and Risks in Adopting GMO: the Case of Soybeans and Corn in Ohio, the United States


David A. Darr, Wen S. Chern, The Ohio State University





The objective of this paper is to measure the impacts on crop production of negative public perception and international trade disputes caused by the genetic modification (GM) that is being rapidly adopted in agriculture. Specifically, the study deals with the benefits and risks of adopting the GMO technology. This is a case study for Ohio, the United States and the crops that will be studied are corn and soybeans. These crops make up a majority of Ohio’s crop acres and are the primary source of concern when considering issues of genetic modification. Ohio farmers are adopting GM technology at a rate not seen before in agriculture. Herbicide resistant soybeans were first introduced in 1996, and as of 1999, 57% of total soybean acreage harvested was genetically modified. Modified corn is making similar progress. In 1999, 38% of Ohio corn was modified to be either resistant to an herbicide or an insect.


Due to recent debates and controversy over the safety of GMO foods, Ohio farmers have been making an effort to become more educated in their planting decisions for this spring. During the harvest of 1999, some local grain processors began declining to accept grain that had been genetically modified. Other elevators were offering premiums to farmers who could deliver grain that tested GMO negative. At one meeting in Plain City, Ohio, on November 16, 1999, over 300 farmers met with officials from major seed producers, grain buyers, and grain processors to talk about the issue. While no strong conclusions were made, meetings such as this open the issue to public debate where opinions can be expressed and facts can be presented.


Information gathered from a survey of Ohio farmers will allow us to collect data on factors affecting farmers’ adoption of GM technology, including why they began to adopt the technology, what benefits have been realized since adoption of GM technology, and what do producers think of the consumer skepticism and its associate risks that exist towards crops produced with genetic modification. From this survey data, we will model the supply response to the growing consumer skepticism about the safety of genetic modification. We will also measure the cost savings that farmers are realizing by adopting this new technology. Possible saving to be measured include: decreased herbicide costs, decreased insecticide costs, lower levels of chemicals applied to the soil, and yield effects of the new technology. The economic analysis of the benefits and risks will provide a basis for assessing the future growth of GMO technology in Ohio and elsewhere in the United States.



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