Government report on economics of GM crops

11 July 2003

A new, key Government report on the economics of GM crops concludes that the public's refusal to eat GM food means that there is little economic value in the current generation of GM crops, and that continuing public opposition would also affect their long-term future.

The report has been published by the Number 10 Strategy Unit. Given that Prime Minister Tony Blair and other ministers are known to support GM technology, the report contains a surprising amount of detail which undermines the case of the biotech lobby. It concludes that:

• any economic benefit to the UK is likely to be limited, at least in the short-term - only a narrow range of existing GM crops are currently suited to UK conditions, and weak consumer demand is likely to limit take-up;

• the overall balance of future costs and benefits will depend on public attitudes, and on the ability of the regulatory system to manage uncertainties;

• any economic benefits from the commercial cultivation of current GM crops are likely to be outweighed by other developments, at least in the short-term. UK farmers do not operate in a fully competitive market, and hence their future profitability is more likely to be determined by national and EU policy decisions - for example, on the Common Agricultural Policy (CAP) - rather than smaller-scale cost savings arising from the use of current GM crops.

Non-GM farms using farm-saved seed may also face problems due to a possible accumulation of GM presence in seeds over the years: this could also have a serious effect on the farm-saved seed industry itself. If the supply of farm-saved seed is reduced, this may increase the market power that seed companies hold over farmer.

"Although this report was written by staff working for a pro-GM Prime Minister, they have been forced to conclude that there is little economic justification for granting commercial approval to GM crops in the short term," said Friends of the Earth's Executive Director, Tony Juniper. "If public opposition continues, the long-term prospect for these crops is equally bleak. The Government should help UK farmers and food manufacturers meet the considerable world-wide demand for GM-free food by keeping Britain's fields free from GM crops.

"The priority for the future should be a programme of investment in sustainable agriculture that benefits consumers, farmers and the environment. To achieve this, the Government will need to end its obsession with crop biotech. Perhaps this report is a first step."

Friends of the Earth has argued that GM crops are a threat to organic and conventional (non-GM) crops and honey. Opinion polls in the UK and across Europe consistently show considerable opposition to GM food - and little support for it. Most food manufacturers and supermarkets now seek non-GM ingredients, providing a strong case for the UK to remain GM-free to help meet this demand. The vote by MEPs to tighten GM labelling laws is likely to increase demand for GM-free ingredients still further.

The Government is expected to decide whether or not to allow GM crops to be commercially grown in the UK later this year.

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