PANNA: GE Seed Market Stalled?


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GE Seed Market Stalled?
January 22, 2001

The US$2.5 billion genetically engineered (GE) seed market is dominated by a single corporation, Monsanto, according to the Rural Advancement Fund International's (RAFI) annual update on seed industry consolidation. Monsanto sells GE seeds for four major crop commodities (soybeans, maize, cotton and canola) almost exclusively in three countries (the U.S., Argentina and Canada).

According to RAFI's report, "Seed Industry Giants: Who Owns Whom?," the area sown to GE seeds increased spectacularly from 1996 to 2000, but weaker growth from 1999 to 2000 indicates that momentum is slowing. Industry analysts predict that GE seed sales have reached a plateau and could be flat for the next few years, a trajectory that is considered potentially fatal for a new technology.

Based on estimates by the International Service for the Acquisition of Agri-Biotech Applications (ISAAA), during the five-year period 1996 to 2000, the global area of transgenic crops increased more than 25-fold, from 1.7 million hectares in 1996 to an estimated 43 million hectares in 2000. But the area devoted to GE crops increased at a much slower rate from 1999 to 2000 (an estimated 8% increase, from 39.9 million to 43 million hectares) compared to the 44% increase from 1998 to 1999.

The market for GE seeds is overwhelmingly dominated by Monsanto (now owned by Pharmacia). In 1999, Monsanto's GE seeds were planted on 34.8 million hectares worldwide--approximately 87% of the total area planted with GE crops in 1999. Global area devoted to Monsanto's biotechnology traits increased by 48%--from 23.5 million hectares in 1998 to 34.8 million hectares in 1999.

Agrochemical industry analysts at London-based Wood Mackenzie estimate that Monsanto held an 80% market share for agbiotech in 1999--followed by Aventis at 7%, Syngenta at 5%, BASF at 5% and DuPont with 3%.

The U.S., Canada and Argentina account for approximately 98% of the area planted in GE seeds in 2000. China accounted for 1% of the total crop area and eight other countries have the remaining 1%.

Four crops--soybeans, maize, cotton and canola--account for virtually 100% of the GE seeds planted in 2000. Almost three-quarters (73%) of the area in 2000 was planted with GE crops modified for herbicide tolerance; 22% was modified for insect resistance and 5% was devoted to "stacked" (combined) traits of herbicide tolerance and insect resistance. Of the total global crop area (273 million hectares) devoted to the four crops, ISAAA projects that 16% of the total or 43 million acres are planted with transgenic crops.

According to ISAAA's preliminary 2000 estimates, GE crops account for:

° 34% of the 72 million hectares of soybean planted globally;

° 16% of the 34 million hectares of cotton;

° 11% of the 25 million hectares of canola;

° 7% of the 140 million hectares of maize.

"The Seed Giants: Who Owns Whom?" December 2000 Update is available on RAFI's Web site
http://www.rafi.org. For a detailed analysis on the future of biotech and what's in the GE pipeline, please see RAFI's November/December 2000 Communique, "Biotech's Generation 3," also available on RAFI's Web site.

Source/contact: RAFI International, P.O. Box 68016 RPO Osborne, Winnipeg MB R3L 2V9 Canada; phone (204) 453-5259; fax (204) 925-8034;
http://www.rafi.org.

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