An Agronomic and Economic Assessment of GMO Canola

Prepared for the Canola Council of Canada by:
Serecon Management Consulting Inc.
and Koch Paul Associates - January 2001

Table of Contents
Glossary of Terms
1.0 Introduction
1.1 Background 1.3 Study Methodology
1.2 Study Objectives  
 
2.0 Transgenic/Conventional Producer Survey
2.1 Survey Methodology 2.7.4 Revenue
2.2 Survey Results 2.7.5 Grower Reported Return per Acre
2.3 Fertilizer Inputs 2.8 Agronomic Practice Change
2.4 Herbicide Inputs 2.8.1 Canola Acreage and Rotations
2.5 Operations (Labour and Equipment) 2.8.2 Seeding Practices
2.5.1 Seeding Operations 2.8.3 Conservation Tillage
2.5.2 Herbicide Applications 2.8.4 Weed and Volunteer Canola Management
2.5.3 Fertilizer Applications 2.8.5 Crop segregation
2.5.4 Tillage and Harrowing Operations 2.8.6 Services and Rentals
2.5.5 Combined Operations 2.9 History of Transgenic Use
2.6 Miscellaneous Inputs 2.10 Attitudes Toward Transgenics
2.6.1 Scouting 2.10.1 Benefits and Reasons for Using Transgenics
2.6.2 Irrigation 2.10.2 Disadvantages and Reasons for Not Using Transgenics
2.6.3 Other Operating Costs 2.10.3 Impact if Transgenics Were No Longer Available
2.6.4 Equipment Investment and Divestiture 2.11 Summary
2.7 Yield, Grade and Revenue 2.11.1 Summary Per Acre Costs and Revenue
2.7.1 Yield 2.11.2 Summary Contribution to Agri-Business
2.7.2 Dockage 2.11.3 Summary Agronomic Impacts
2.7.3 Grade  
 
3.0 Case Studies
3.1 Description of Case Study Operations 3.2.4 Weed Management Practices
3.2 Agronomics Practices 3.2.5 Soil and Water Conservation Practices
3.2.1 Variety Selection and Acreage of Production 3.2.6 Harvest Methods and Timing
3.2.2 Tillage and Planting Practices 3.3 Financial Performance
3.2.3 Fertilization Practices 3.4 Environmental and Social Aspects
 
4.0 Economic Analysis
4.1 Introduction and Approach 4.6 Economic Analysis Summary and Conclusions
4.2 The Canola Industry Economic Model 4.6.1 Direct Economic Impacts
4.2.1 Structure 4.6.2 Aggregate Impacts
4.2.2 Data Assumptions 4.6.3 Opportunity Costs
4.3 Economic Model Results 4.7 Indirect and Induced Impacts
4.3.1 Direct Economic Impacts 4.7.1 Multiplier Impacts
4.4 Environmental Impacts 4.7.2 Total Economic Impacts
4.4.1 Herbicide Use 4.7.3 Impacts On Canola Prices
4.4.2 Fertilizer Use 4.8 Environmental and Resource Use Results
4.4.3 Fuel Consumption 4.8.1 Herbicide Use
4.4.4 Transgenic Canola's Impact On Canola Prices 4.8.2 Fertilizer Use
4.4.5 Long Term Impacts of Transgenic Canola on Prices and Exports 4.8.3 Fuel Savings
4.5 Secondary and Multiplier Impacts  
 
5.0 Summary and Conclusions
5.1 Agronomics 5.2.3 Summary of Economic Impacts
5.2 Economic Analysis 5.2.4 Market Responses
5.2.1 Direct Effects 5.3 Environmental And Social Aspects
5.2.2 Indirect and Induced Effects  

List of Figures and Tables
1.0 Introduction
Figure 1.1 Study Methodology  
 
2.0 Transgenic/Conventional Producer Survey
Table 2.1 Sample and Margin of Error by System Table 2.15 Conventional 1999 Summer Fallow Herbicide Applications
Table 2.2 Sample Distribution by Geography Table 2.16 Cost of Seeding Operations
Table 2.3 Percentage of Transgenic Growers Planting Each Variety Table 2.17 Cost of Tillage and Harrowing
Table 2.4 Percentage of Conventional Growers Planting Each Variety Table 2.18 Cost of Combined Operations
Table 2.5 Seeding Rate Table 2.19 Combined Operations and Costs for Various Practices
Table 2.6 Seed Type Table 2.20 Cost of Scouting Operations
Table 2.7 Computed Seed Costs Table 2.21 Yield Before Dockage (% of Growers)
Table 2.8 Transgenic Fertilizer Costs Table 2.22 Dockage
Table 2.10 Transgenic Herbicide Inputs Table 2.23 Grade
Table 2.11 Conventional Herbicide Inputs Table 2.24 Transgenic Canola Revenue Summary
Table 2.12 Trnasgenic: Fall 1999 and Spring/Summer/Pre-harvest 2000 Herbicide Applications Table 2.25 Conventional Canola Revenue Summary
Table 2.13 Transgenic 1999 Summer Fallow Herbicide Applications Table 2.26 Summary Cost Per Acre
Table 2.14 Conventional: Fall 1999, Spring/Summer/Pre-harvest 2000 Herbicide Applications Table 2.27 Summary Economic Impacts
 
3.0 Case Studies
Figure 3.1 Percent of Varieties Grown Table 3.1 Source of Canola Information
Figure 3.2 Percent of Acres Grown  
 
4.0 Economic Analysis
Figure 4.1 Economic Approach Figure 4.9 Summer Fallow Opportunity Costs
Figure 4.2 Per Acre Results, Transgenic Canola Figure 4.10 Relative Use of Herbicides (tonnes)
Figure 4.3 Per Acre Results, Conventional Canola Varieties Figure 4.11 Transgenic Canola Impact on Herbicide Consumption
Figure 4.4 Gross Margin Analysis Figure 4.12 Fuel Savings for Transgenic Canola
Figure 4.5 Acres in Transgenic and Conventional Canola Figure 4.13 Canola Prices and Production, 1982-2000
Figure 4.6 Annual and Cumulative Economic Impacts of Transgenic Canola Figure 4.14 Trends in Selected Commodity Prices, 1982-2000
Figure 4.7 Direct Economic Impact, Producer Survey Estimate Figure 4.15 Multiplier Impacts of Transgenic Canola
Figure 4.8 Opportunity Costs of Transgenic Canola Figure 4.16 Cumulative Direct and Secondary Impacts of Transgenic Canola
   
Table 4.1 Canola Price and Yield Table 4.7 Summer Fallow Opportunity Costs
Table 4.2 Input Prices Table 4.8 Fuel Savings - Transgenic Canola
Table 4.3 Total and Distribution of Acres Harvested by Canola Production System Table 4.9 Commodity Price Correlations
Table 4.4 Comparative Per Acre Returns, Costs, and Gross Margin, Crop Production Year: 2000 Table 4.10 Economic Multipliers
Table 4.5 Aggregate Model Results, Transgenic Canola Table 4.11 Accumulative Economic Impacts of Transgenic Canola Production Systems
Table 4.6 Aggregate Model Results, Conventional Canola  
 
5.0 Summary and Conclusions
Table 5.1 Producer Per Acre Estimates Table 5.2 Direct Economic Impact