The Economics of Genetically Modified Crops

The potential of genetically engineered crops is manifold. This occurs even in the midst of the dwindling effects it has on the resource base thus promising a significant increase in productivity hence promoting sustainability regarding food supply as well as the provision of raw materials for the rapidly growing population. Genetically modified crops give rise to environmental benefits that play a central role in alleviating poverty through income generation especially in developing countries. It is through genetically modified foods that there is a nutritional enhancement in the plants hence offering a new platform through which human health is enhanced.

In spite of the contributions that are realized through the introduction of GM crops, its development has aroused lots of opposition. This is particularly high in Europe, and the effect has spilled over to other parts of the globe. This is through such aspects as trade regulations, media coverage as well as the establishment of outreach groups that intend to lobby anti-biotechnology usage. The key driving forces for these issues is the concern over the environment, health risks as well as social implication effects. For example, there is fear that consumption of GM crops and foods derived from them having the potential to undermine traditional knowledge systems, especially in developing countries.

Regarding economics, the increase in privatization of crop improvement research has aroused possible monopolization of the seed market and thus causing adverse exploitation of the farmers in the region. This is because GM crops are associated with novel possibilities that have triggered research dealing with aspects of the economy and policy making. Through this article, there is a clear outline of the economic factors that relate to GM crops.

Status of GM crops

Commercialization of GM crops
The commercial application of the GM crops goes way back to the mid-1990s and has then spread across the globe. According to reports released in 2008, GM crops were grown in over 25 countries in over 120 ha of land. However, the US registered the highest share of GM crops accounting for 50 % of total ha across the globe. Despite the fact that there is a significant increase in approval of GM technologies in some countries in Europe, the commercialization of the GM crops is still negligible. This is because of a low level of public acceptance as well as other regulatory framework factors that are not favorable.
Today, there is a limited number of technologies that are commercialized including herbicide tolerance in soybeans among others. GM maize also has been introduced to confer herbicide tolerance as well as resistance against insects. The resistance against insects is based on a wide range of genes that spring from Bacillus thuringiensis bacterium. It is these Bt genes that play a central role in the control of corn rootworm, corn borers as well as other stem borers.

Micro-level impact of the first generation GM plants
Many of the studies that focus on the micro-level impact of GM plants are currently based on random sample surveys as well as a comparison of adopter performances with non-adopter GM crops. However, this kind of comparison is characterized by selectivity bias. Additionally, its adoption may give rise to an overestimation of technological impacts and underestimation of farmers’ impact under certain conditions. Bacillus thuringiensis technology is a promising platform for control of pests in the environment. Some of the approaches that are geared towards addressing selectivity bias using econometric means include;

Empirical evidence: Bt GMO plants do not entirely get rid of the need for sprays against insects. This is because there still crop damage that occurs. The reason for this is based on the fact that Bt toxins have a high specificity for certain species of pests while insect pests are not affected at all. There is evidence that insecticide-reducing effect, as well as yield increasing the effect, is observed on the international front with high scores reported in Argentina and India.
Conventional cotton farmers often use very low levels of insecticides and thus effectiveness in controlling pests is small. However, the use of pesticides in India is higher. This suggests that there is a yield effect of the Bt technology is influenced by the quantity and quality of insecticides used hence control of damage on cotton. Additionally, the resistance to insecticides, as well as the timing of spraying the GM crops, is also to be considered xxx.

Econometric estimates: using different models, this confirms the net effect on insecticide reduction and increasing effect on yield in using the Bt technology. This is evident through the demonstration that part of the impact variation that was seen in some countries like India was because of integration of the Bt gene in a few cotton varieties that did not suit the location. This is because the positive impact of this gene was undermined by the adverse effect of the germ-plasm.
This indicates that the full benefits of GM plants can be realized through the insertion of the target gene in a wide range of varieties that are locally adaptable. This is the approach that is used in reducing the occurrence of selectivity issues as well as problems associated with endogeneity.

Gross margin effect:
 farmers that have been shown to adopt Bt technologies have benefited from the economic advantage that is related to female entrepreneurs saving insecticides as well as high yields. This means that on average the gross margin gains are estimated to be very high in the case of such crops as GM Bt maize and GM Bt cotton. Additionally, the cost of seeds is much lower in developing countries as opposed to other regions of the world. This is attributed to the weak aspects that relate to intellectual property rights, seed production, subsidies as well as other price interventions that are set by the government. Additionally, other factors such as agricultural policies play a role in determining the gross margin effects.

Conclusion
Aspects that relate to economics play a pivotal role in determining novel ways through which social benefits can be maximized. This means that more effort is to be directed towards quantification of possible indirect effects of GM plants and the outcome it has on health and the surrounding environment. This is through a significant contribution made by economists in designing efficient regulations and innovative systems. This could finally lead to advanced levels of income generated from the sale of GM crops.

Production of GMO Roundup Ready Soy plants

    There is a broad range of methods that are employed in the process of producing GMOs. This often involves insertion of a gene of interest into living organisms depending on the species that you are working on. In plants mainly, two most common biotechnology-based techniques include; Agrobacterium-mediated transformation and bombardment of particles. According to the regulations given by FSANZ, it is a requirement that clear description of the method employed in genetically engineering plants is given.

Case study- Roundup Ready soy

    This was produced using the particle bombardment method. This process of biotechnologically engineering soybeans involved; bombardment of the plant cells with microscopic particles of gold coated with DNA that contains the gene of interest. The gene of interest is the EPSPS gene that is derived from Agrobacterium. The aim of this is to introduce the novel gene of interest through the cell wall so that it integrates into the genetic material of the soy plant.

    The new round up soy that is genetically engineered contains a new gene that codes for the EPSPS enzyme. The new plant cell controls the activity of all the genes through the use of regulatory sequences. These regulatory sequences do not code for any protein but rather plays a central role in the regulation of gene activity in the soy plant by either switching the genes on or switching them off. However, in the case of the roundup soy, plant cells often do not recognize the regulatory genes derived from bacterial cells. This means that when the regulatory sequences are introduced from the bacterium into the plant, the regulatory DNA has to be replaced with those that can be recognized by the plant. Thus, the EPSPS gene derived from Agrobacterium works in the soy plant through replacement with those that are recognized by the soy plant.

    The figure above demonstrates the manner in which gene regulation takes place in the roundup soy. At the front of the bacterial EPSPS gene in the roundup, soy is the regulatory sequence that directs the plant to switch genes on or off. This is the CaMV 35S promoter sequence is derived from cauliflower mosaic virus. At the end of the EPSPS gene is another regulatory gene that directs the gene of interest to end. This is referred to as NOS 3’’ and is derived from nopaline synthase gene in bacteria but can function in plants. 

    Another regulatory sequence that is introduced into the soy plant is the chloroplast transit peptide gene that is derived from a petunia. The role of this gene is to direct the soy plant cell to transport the bacterial EPSPS gene into the chloroplast of the plant cell. This is because for the soy plant to demonstrate tolerance to roundup herbicides, the EPSPS enzyme has to be present in the chloroplast. This is because this is the location where the amino acids that make up the protein are produced. Once the EPSPS enzyme is in the chloroplast, the chloroplast transit peptide is eliminated for the gene of interest to function.

    With this GMO soy plant, standard molecular biotechnological methods were employed in demonstrating that a single complete copy of the bacterial EPSPS gene was present and flanked by two DNA sequences found in the genome of the roundup ready soy plant. This is an indication that the right size and correct sequence of the gene of interest were genetically engineered into the soy plant to confer resistance to herbicides.

    Additionally, the novel gene introduced into the roundup ready soy was assessed in the third and the sixth generation of soy plants using biotechnological approaches. This indicated that the new gene of interest was stable and had integrated itself well into the Soy genome. Again, the roundup ready feature of the soy plant was examined across a wide range of generations thus indicating its ability to be passed on from the parents to the offspring in a rational and predictable manner following the laws of heredity.

    The issues that arise from the discovery and production of the GM roundup ready soy are mostly relevant to the potential transfer of the gene that confers antibiotic resistance from the GM soy foods to the gut of the bacteria. However, it is important to note that roundup ready GM soy does not contain the antibiotic resistance gene, but the only gene that could potentially be transferred to the human digestive system is the bacterial EPSPS gene. This gene does not have any impact on the people’s health since EPSPS gene in the GM soy plant functions in a similar manner as the one predominantly found in the bacterial gut. There is also no evidence that points at the ability of the new gene in GM soy having a potential to integrate into the DNA genome of humans and thus poses no known health hazard. Additionally, there is no sequence similarity to the gene to allergens and thus has no ability to cause allergenic reactions.

    The genetically engineered soy is similar in structure as well as function to the naturally occurring soy plants while the EPSPS gene in plants and bacteria are also similar regarding the roles they play. However, the difference between the two soy varieties is based on the fact that the GM soy is more tolerant to herbicides as compared to the other naturally occurring type. According to scientific publications of GM soy, there is a single amino acid alteration in the EPSPS enzyme that confers its tolerance to glyphosate. On the other hand, the bacterial EPSPS enzyme is made up of over 400 amino acids. Additionally, bacterial EPSPS levels present in fresh edible soy constitutes less than 0.1 % of the total protein levels. According to research, the enzyme of interest in the GM soy has not been demonstrated to have any activity when eaten. This is because the enzyme is inactivated upon exposure to heat during food processing.

Revisiting the Usefulness of Aesthetic Genetic Modifications with Innate Potatoes

    Innate potatoes, developed by the agency J.R. Simplot, are the first genetically modified potatoes to be approved by the FDA for consumption. The potatoes have a wide verity of inserted genes added for the benefit of the crop, the farmers growing them, and consumers who purchase them. In the article “What Varieties of Potato are GMO?” on Livestrong, it is reported that the potatoes come in three different varieties- Ranger Russett, Russett Burbank, and Atlantic. Also in the report it was listed that, in their March 2015 press release about their evaluation of the crop and decision that the potatoes passed criteria such as toxicity, potential for allergic reaction, stability of unintended side effect, and more.

     The main benefit that is highlighted in media coverage of the Innate potatoes are the same benefits that Arctic Apples were designed to have- a resistance to unattractive bruising and brown spotting on the inside. NPR goes into further detail in “GMO Potatoes Have Arrived. But Will Anyone Buy Them?”, explaining that the reason the agency named the potatoes “Innate” was because the genes used to silence the reaction in the spuds that caused the browning are actual native to potatoes themselves, but that they went unused after a while. Much of the food waste in the world comes from the distribution process, either when processers discard unattractive foods or when consumers at home discard their bruised fruits and vegetables before eating them. The hope is that this process keeps potatoes looking more healthy and attractive so that less will be wasted in the trash.

      Another potent benefit of the modified potato, as mentioned in the NPR article, is that the Innate potatoes contain much less of a chemical known as acrylamide, which is triggered in the frying process. Studies on lab rates have shown that consumption of acrylamide increases the potential of cancer in lab rats, a litmus test often showing parallels in humans.

     There are a host of other benefits, explains the article “Genetically Modified Potatoes Are Making Their Way to the Produce Section” from Fortune. The potatoes are designed to resist the blight that led to the Irish Potato famine, an inserted gene from another species located in Argentina that grew to resist such pathogens. This kind of blight protection is handy for farmers, as it allows the plant to protect itself from the most common diseases they would have to look out for. The potato is also designed to be able to be stored for a longer period of time at lower temperatures, allowing them to be kept in stores and sold over a greater duration. This is also hoped to reduce the spoils of food waste on the distribution side.

     Although there are a great number of seeming benefits to the use of these potatoes, Simplot agency faces the same problems as do the other producers of genetically modified plants- there is still a heavily negative perception of such crops and a reluctance to adopt their use. Big retailers such as the McDonalds Corporation (who has worked with Simplot for many, many years), Frito-Lay, and ConAgra foods have all publically stated they will not use the modified plants. Even with a successful FDA evaluation of the crop, Simplot will have to do more on its end to prove to consumers that their new potatoes are worthy of interest and will do more good for public health than bad. This will be an important obstacle to overcome to a huge market as potatoes are reportedly the third most consumed food crop in the world, according to the International Potato Center.

Sources:
Addady, M. (2016). Genetically Modified Potatoes Are Making Their Way to the Produce Section. Fortune.
Charles, D. (2015). GMO Potatoes Have Arrived. But Will Anyone Buy Them? NPR.
International Potato Center. (2016). Potato. International Potato Center.
Renee, J. (2015). What Varieties of Potatoes Are GMO? Livestrong.