Agricultural News |
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Preserving identity adds cost and value to cropsBy Bonnie Coblentz MISSISSIPPI STATE -- One of many changes in agriculture is a move to produce crops with specific traits for particular end uses, but producing those crops can be risky business. An identity-preserved crop is one in which specific genetic traits are known to exist. Special steps have been taken in buying the genetically-modified seed, planting, harvesting and storing to ensure crops with these traits are not mixed with other crops. Darren Hudson, a Mississippi Agricultural and Forestry Experiment Station agricultural economist, recently studied the extra costs and risks associated with growing identity-preserved crops. "Advances in biotechnology have allowed for the production of crops that are tailored toward the needs of the end consumer," Hudson said. "Convincing producers to grow these crops can be a challenge because they are new, and there are added costs." Examples of genetically-modified crops whose identity is carefully preserved include high oil corn and soybeans, high lysine soybeans and golden rice. The high oil grains and high lysine soybeans are used to improve feed productivity, and golden rice is high in vitamin A. When farmers plant a crop with specific genetically-modified traits, that grain must be tracked at all points and stored separate from traditional grains. Because the grain has certain known, special traits, it can be sold for a premium, but there are also added production costs. "There are physical costs of having to maintain separate equipment and storage, and the farmer has to devote time and energy into developing a procedure to follow to be able to document these separate measures," Hudson said. "We don't know what all the added costs are at this point because some of these products aren't on the market yet." Hudson co-authored a study on the cost of identity preservation with Tom Jones, retired agricultural economist with Mississippi State University's Extension Service. This study, which will appear in the December issue of the Journal of Agricultural and Applied Economics, estimated the added production cost of identity preserved soybeans to average 46 cents a bushel in Mississippi. Because of this added cost and without a guarantee that there will be a continuing market for genetically-modified crops, many producers are hesitant to produce identity-preserved crops. "Since a lot of these products are not on the market, producers don't have a full idea of what the intrinsic costs are. Most are being grown under contract at this point," Hudson said. "There's always risk, but identity preservation itself does not add a lot of price risk. The risk is if you invest money in seeders or on-farm storage and you have a one-year contract, who's to say they're going to come back next year with another contract." Uncertainties in the market are mostly due to the new technologies' progress through the approval process and the acceptance or skepticism they receive from consumers. "As the markets develop, there is some concern whether buyers will be there, but as the markets stabilize, the risks associated with producing the identity-preserved crop lessen and the premiums paid for the crop will likely decline," Hudson said. The number of Mississippi producers growing identity-preserved crops is low, but so is the number of identity-preserved products available. Hudson said he expects both the number of such products to grow, and with it, the number of state producers growing these crops. "I think Mississippi producers are looking at the process with a healthy skepticism and are carefully examining the costs and benefits to them," Hudson said. Released:
Oct. 1, 2001 |
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