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18 BIO LIFE January – March 2005 by 23 centavos than the non-Bt, but cash costs were higher. The net income per kilo Table 3. Prices, Net Income and Returns to Labor and Management, showed a difference of 10 centavos for the 407 Bt and Non-Bt Corn Farms, Philippines, 2003-2004 Bt corn and had an advantage of more than CORN TYPE/ Cost of Net Cash Return to P1/kg in returns over the non-Bt varieties. LOCATION Price Production Income Costs Labor and Yorobe also observed that Bt corn received Pesos/kg Management a premium price in the market due to better (1 - 4) quality and less impurities. He said that Bt Bt corn farmers, particularly in Camarines Sur Camarines Sur 8.00 5.86 2.14 5.38 2.62 and Bukidnon, received premium prices by Bukidnon1st crop 6.86 5.99 0.87 5.27 1.59 as much as P1.61/kg during the second crop. Bukidnon 2nd crop 9.80 10.08 (0.28) 9.30 0.50 Many farmers traced this to the fact that Bt South Cotabato 8.83 4.61 4.22 4.29 4.54 corn kernels and ears were bigger and Isabela 8.92 4.27 4.66 4.10 4.82 cleaner with uniform sizes. All locations 8.82 4.97 3.85 4.66 4.16 In sum, (Table 4) (Table 6 in the study) the increase in total revenue of Bt corn farms Non-Bt amounts to P14,849 per hectare, with savings of P168/hectare in insecticide expendi- Bukidnon 1st crop 6.66 5.31 1.36 4.30 2.36 ture. Although the seed costs were twice Bukidnon 2nd crop 8.19 5.16 3.02 4.23 3.96 higher than the non-Bt varieties, the study South Cotabato 8.11 4.92 3.20 4.35 3.76 showed that the profit advantage almost Isabela 8.68 4.77 3.90 4.52 4.16 doubled. The benefit cost ratio of 2.014 All locations 7.71 5.20 2.51 4.56 3.15 shows the better performance of Bt corn. Source of data: ISAAA Corn Survey, 2003-2004 With the estimated area planted to Bt corn Bicol 6.84 6.10 0.74 5.66 1.18 in 2003-2004 at 10,769 hectares, Table 5 (Table 13 in the study) shows the results of the distribution of benefits. The estimates are Table 4. Income and Cost Advantages of Bt corn Farm Adopters, presented by region owing to wide differences in agro-climatic conditions and man- 407 Bt and non-Bt Corn Farmers, Philippines, 2003-2004 agement practices across regions, Yorobe CROPPING/ Increase Pesticide BC Ratio explained. LOCATION in Total Application Additional Additional (total Variations in yield per hectare and cost Revenue Savings Seed Cost Profit returns/ per unit were evident in the results. With a (Pesos/hectare) total cost) larger area planted to Bt corn and a higher 1st Cropping cost reduction per unit, the net benefit to Camarines Sur 13,833.00 179.00 2,202.00 4,462.00 1.363 farmers was largest in Northern Luzon, with Bukidnon 7,210.00 (78.00) 2,626.00 (701.00) 1.201 P20.95 million. Farmers in other regions had lesser benefits because of the smaller area 2nd Cropping planted to Bt corn and minimal reported cost Bukidnon (710.00) 47.00 2,649.00 (6,283.00) 1.365 reduction per unit of production. Isabela 8,680.00 132.00 1,741.00 7,910.00 2.285 Farmers in Northern Mindanao had South Cotabato 14,046.00 446.00 2,289.00 7,669.00 1.991 negative benefits as more costs were reported on fertilizers, chemicals and hired labor. Farms in these areas also experienced Source of data: ISAAA Corn Survey, 2003-2004 drought and stalk rot infestation. All locations 14,849.00 168.00 2,047.00 10,132.00 2.014 After one year of commercialization, the net benefit to farmers in the aggregate amounted to P46.44 million. This was estimated using the area planted to Bt and the reduction in per-unit costs. The estimated gross revenue by the seed company was P43.48 million, which includes the cost of the technology. These benefits, Yorobe underlined, represent the direct and immediate impact of the corn industry and now cover the indirect effects with other industries, like livestock, where corn is a big demand. Farmers’ profile It is interesting to note that there are some noticeable differences observed in the characteristics between Bt and non-Bt After one year of commercialization, the net benefit to farmers in the aggregate amounted to P46.44 million. This was estimated using the area planted to Bt and the reduction in per-unit costs. corn farmers, which could be important factors in the adoption of the new technology. (Table 6) (Table 1 in the study). It shows that Bt corn farmers were relatively younger (45.38 against 46.77 years), and have larger farms ((4.04 hectares against 2.47 hectares) than their non-Bt counterparts. The area planted to Bt corn was also larger (2.64 hectares) compared to non-Bt corn (1.64 hectares). Bt corn farmers were also better-educated (about 10 years of formal schooling against the non-Bt users’ eight years); they earned more—over P2,000 a month—from other sources besides farming, and this is an important source of capital for farming opera-
January – March 2005 BIO LIFE 19 Table 5. Welfare Effects of Bt corn Adoption, by location, Philippines, 2003-2004 Northern Southern Northern Southern All Item Luzon Luzon Mindanao Mindanao Locations Area (hect ares)a 7, 901 2,257 130 481 10,769 Yield/ha (kg) 5, 304 4,516 4,215 4,794 4,850 Price (PhP/ kg) 8.68 8.00 8.33 8.11 8.82 Cost reduction (PhP/ kg) 0.50 0.24 (0.68) 0.31 0.23 Net Benefit to Farmers (million P)b 20. 95 2.45 (0.37) 0.71 46.44 Estimated Gross Revenue to Seed Companies (million P) 30. 61 10.16 0.62 2.09 43.48 a Estimates provided by Monsanto, Philippines. b Taken from Appendix Table 1. Source of data: ISAAA Corn Survey, 2003-2004 Table 6. Selected characteristics of farming households, Bt Corn Study, Philippines, 2003-2004. Characteristic Bt Non-Bt All Farm size (ha) 4.04 2.47 2.82 Corn area (ha) 2.64 1.64 1.86 Planted corn area (ha) 2.32 1.55 1.72 Age (years) 45.38 46.77 46.46 Years of schooling 9.65 7.81 8.22 Income from other sources (per month) 4,066.79 1,088.56 1,766.58 Membership in farmer organization (%) 47.66 57.02 54.89 Contact with extension worker (%) 91.04 84.89 86.30 Chemical expense (PhP/ha) 267.21 406.52 371.69 Hired labor (Man-days/ha) 51.99 46.98 48.22 Variety used (%) 25 75 100 Source of data: ISAAA Corn Survey, 2003- 2004 tions. The study also showed that although fewer Bt corn farmers were members of farmers’ organizations, many of them (91 percent) have frequent contact with extension workers. What needs to be done With the high cost of Bt corn seeds, Yorobe said findings ways to reduce that cost will certainly result in a net benefit to farmers. “The current effects are still minimal considering an adoption rate of only 1 percent,” he said. In order to further realize the benefits of Bt corn through higher adoption rates, public support is needed in terms of information dissemination, development of the Bt corn seed market and the government incentives to facilitate farmers’ access to the technology. He said that the availability of Bt corn seeds is still limited and domestic seed production capacity is still low. “As the seed market is opened to other entrants, the adoption rate and welfare gains are expected to increase in the future,” he said. Despite its current limitations, Yorobe said that the results of the one-year introduction of Bt corn to Filipino farmers “clearly favor the national agenda of increased productivity and income for small corn farmers.” But, he asserted, “the adoption level should be increased.” Farmers shifting to new corn technologies WHENEVER farmers find a crop that offers good income and is more comfortable to work on than their existing crop, they would not take so much time to decide on whether or not they are going to adopt the new crop. Chances are that they would switch to the new crop to make their lives a little bit more comfortable. Such is the case in three towns of Pampanga, particularly in Lubao, Arayat and Mexico. Traditionally, almost all farmers in these towns have been producing rice and sugarcane. Others are into banana, mango and eggplant farming. With fellow farmers in Pampanga making more profit from Bt (Bacillus thuringiensis) corn, more and more farmers in these towns are going into Bt corn production in order to cut cost of production, increase yield and reduce the use of chemical sprays. Bt corn, a bio-engineered or genetically modified crop, is resistant to the Asian corn borer, which can cause severe yield losses. One of the farmers who has made the switch is Carlos “Caloy” G. Guevarra, who operates a 10-hectare corn production area in barangay Anao, Mexico, Pampanga. Using a Pioneer hybrid 30Y73 with YieldGard Corn Borer Protection during the dry season, he was able to harvest an average yield of a recordhigh 10.25 metric tons (mt)/hectare, equivalent to 153 cavans. Guevarra said, “At a price of P7.50 a kilo corn grain, my gross income reached around P76,000, giving me a net income of more than P50,000 a hectare.” Guevarra likes to use the new technology even if he does not usually encounter corn borer problems in his farm because he claims that farmers can never really predict when the insect pest will significantly damage Turn to page 33
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