Revisiting Biotech Wheat


Over a year has passed since commercialization of Roundup Ready (RR) hard red spring wheat in the U.S. and Canada was put on indefinite hold over concerns about market acceptance in the two countries and in major wheat importing countries. The continued expansion in production of biotech crops indicates that biotech wheat may have a brighter future in the years ahead.

Biotechnology continues to grow in acceptance as a valuable production tool to increase output, lower costs, reduce pesticide use and enhance consumer value. Last year Brazil established a government regulatory structure for biotech crops. Biotech white corn for human consumption is increasingly accepted by small growers in South Africa. India has approved additional varieties of Bt cotton for more areas of the country. China has completed extensive farmer field trials on Bt rice. Australia has had broad adoption of Bt cotton and is having a wide ranging debate on production of other biotech crops. The Philippines has approved additional varieties of biotech corn. The EU and Japan have approved additional corn varieties for import for feed and food use. Over one billion acres of biotech crops have been planted since commercialization began in 1996.

The issue of biotech wheat is much wider than just herbicide tolerance. Syngenta is working on a biotech fusarium head blight (FHB) resistant wheat. FHB is considered to be the number one problem in yield and quality for small grains. The fungus can be controlled with pesticides, but the spray window is fairly narrow for the best control.

Less talked about is drought tolerant biotech wheat. Drought tolerance is an issue for the richest soils in the U.S. and Argentina and the poorest soils in Africa. Wheat has been characterized as a “desert weed” because of its limited need for water, but it still needs substantial water at critical seed formation and development stages.

Biotech wheat also holds promise for consumer traits. Protein quality, nutrient content, reduced allergens, freshness and shelf-life of products are all consumer issues at various levels of research. Without acceptance of biotech production practices, consumer traits would have to carry the whole weight of gaining regulatory and consumer acceptance of biotech wheat.

Wheat has to compete with other crops for the use of farmland. Some analysts consider RR wheat and FHB resistant wheat as the first major production technology breakthroughs for wheat since semi-dwarf varieties in the early 1970s. The competition for farmland can be seen in the shift in crop acreage over the past 10 years in North Dakota, a major growing area for hard red spring wheat. Prior to 1996 government farm program payments were tied to historical planting patterns for crops. The 1996 farm bill allowed farmers to respond more to market prices and production costs.

In 1995 North Dakota farmers planted 11.3 million acres of wheat. By 2005 wheat plantings fell to 8.9 million acres. Soybeans, canola and corn which benefit from biotechnology have increased acreage in North Dakota from 1995 to 2005. Soybean acres increased from 0.7 million acres to 3.0 million, canola from 0.2 million acres to 1.0 million acres, and corn for grain from 0.7 million acres to 1.5 million acres.

In a June 2005 report William Wilson and others from North Dakota State University estimated that hard red spring wheat yields would increase by 11-14 percent with the use of Roundup Ready Wheat (RRW). They noted this is similar to yield increases with the adoption of biotech corn. Estimates of cost savings range from $8.30 to $11.57 per acre for adopters of RRW. Nonadopters are expected to save about $2.28 per acre as other herbicide treatments are expected to have lower prices to meet the new competition.

For 2000 to 2004 North Dakota spring wheat yields averaged 36 bushels per acre and market prices averaged $3.22 per bushel. An increase of 11 percent in yield would increase yields by 4 bushels per acre and gross income by almost $13 per acre. The combined increase in yield and reduction in cost would be over $20 per acre. Total gross income per acre averaged $115 for 2000-2004.

U.S. and Canadian wheat growers also face the possibility that China may jump ahead of them in releasing a biotech wheat. Most of the attention in China is now focused on a decision to allow commercial biotech rice production. Once that decision is made, China would likely also allow production of other biotech food crops, including wheat. If China commits to commercialization of biotech wheat, researchers in other countries that are major wheat producers are likely to step up commercialization efforts.

While countries like Japan and the EU are rich enough to have the luxury of rejecting biotech wheat, other price sensitive buyers are much more likely to be accepting if some of the lower costs of production are reflected in lower market prices. The Wilson report cited earlier suggested that the market price difference for biotech wheat may be $0.15-0.25 per bushel. Spring wheat is considered a premium wheat because of its higher protein content. The ability to get a premium product for less than a premium price could cause some buyers to accept biotech wheat.

U.S. and Canadian wheat producers cannot idly set by as the biotech revolution continues to march around the world. They will have to address real market issues and find solutions that work for producers and consumers.

Ross Korves

Ross Korves

Ross Korves served Truth about Trade & Technology, before it became Global Farmer Network, from 2004 – 2015 as the Economic and Trade Policy Analyst.

Researching and analyzing economic issues important to agricultural producers, Ross provided an intimate understanding regarding the interface of economic policy analysis and the political process.

Mr. Korves served the American Farm Bureau Federation as an Economist from 1980-2004. He served as Chief Economist from April 2001 through September 2003 and held the title of Senior Economist from September 2003 through August 2004.

Born and raised on a southern Illinois hog farm and educated at Southern Illinois University, Ross holds a Masters Degree in Agribusiness Economics. His studies and research expanded internationally through his work in Germany as a 1984 McCloy Agricultural Fellow and study travel to Japan in 1982, Zambia and Kenya in 1985 and Germany in 1987.

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