Biotech-Based Crops Poised to Erode Insecticide Sales; Growers Predicted to Substitute Technology Fees for Insecticide Purchases
By Kline & Company, Inc
Acceptance of biotechnology is already looming as a major issue facing the food industry, and it will determine whether growers of these crops will be able to realize the benefits of this technology. Although Kline continues to monitor this issue, its projections are based on the hypothesis that the controversy will abate when: (1) traits are made available that are more clearly beneficial to consumers; and (2) industry communication programs outlining the benefits take effect. "We found in our research that the industry expects the newer output traits to be utilized in a genetic background that includes insect-resistance and herbicide-tolerance traits," said Mancer Cyr, a senior associate at Kline.
The biggest percentage hit is expected to be taken by the corn insecticide category, historically a $250 million to $300 million sector. After resistance to corn rootworm is incorporated into seeds that already resist European cornborers, Kline estimates that the market will drop by 70%. Cotton will be less affected by the trend because of a broader mix of insect pests. The herbicide sectors all show modest declines in expenditures due to a shift in market share toward lower priced, broad-spectrum glyphosate, which is primarily produced by Monsanto.
BIOTECH 2009 BUSINESS ANALYSIS forecasts the use of 122 herbicide and insecticide active ingredients on three major row crops across 28 genetically enhanced seed types through the year 2009. An innovation in this year's edition of the report is a simulator program that enhances the value of the report, enabling clients to do their own crop/chemical scenario building.
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