From the still-vex'd Bermoothes.
" recently | in Southern Exposure
argentina | by Marcelo | 18 Jan, 2004 at 10:10 PM | comments (3) | trackback (0)

Monsanto -the worldwide leader in agricultural biotechnology- has announced that it will no longer sell GM soybean to Argentine customers given the extensive black market of seeds in the country. This is highly non-trivial news, as soy is one of Argentina's key economic engines.

First of all, let's not descend into "good, GM crops are evil anyway" arguments. You might -if you feel nervous about biotechnology- choose other products, but to mass-produce agricultural products at competitive prices (i.e., without being subsidized by a government), there's no substitute for genetically modified crops.

Now, the short-term effect of Monsanto's withdrawal is probably going to be small. After all, Argentine farmers are, in significant numbers (although I'd like to see confirmation of Monsanto's RIAA-like figures), acquiring their seeds in the black market. Also, there are other sellers, although they all license technology from Monsanto. It's not clear to me wheter they'll still be able to do so.

Along the road, the consequences can be very bad. Agricultural biotechnology is a key enabler for the country, and were we to get locked out of it for licensing reasons, the economic impact to Argentina would be significant.

A number of things could happen now. The Government could try to calm down Monsanto by cracking down on the black market. Resellers could still operate legally. Black marketers (or state-funded scientists, why not?) could step up their resources and mount a "crack-and-duplicate" operation to provide the country with varieties obtained elsewhere (although there'd still be the issue of losing competitivity by lacking country-specific varieties, and the legal issues... oh, my). Local (or at any rate non-Monsanto) biotech laboratories could see the window of opportunity and jump into it. I'm not sure.

As you might have guessed, I'm not very familiarized with the seed market either in Argentina or elsewhere. Most of my scenarios are extrapolations of equivalent software piracy cases (and after all isn't the genetic code, oversimplifying things a bit, just software for cells?). If you have factual knowledge and/or practical experience with agribusiness, Monsanto, GM crops, etc, please drop a note in the comments. GM crops are a critical issue for both Argentina and Brazil (the Number 3 and 2 soy producers in the world), and thus a key piece in the intellectual and developmental puzzle that is Latin America.

Also, there is a "Neuromancer"-like coolness factor in discussing black market for GM crops, isn't it? Even if it's one of the oldest "future technologies" out there.

" comments

A shift is occuring in GM seed. India and China seem committed to becoming leaders in this business and may well do so. There are also non-commercial efforts (CIMMYT) to help develop local technology in Africa and S. America to lessen dependence on US seed and to develop cultivars based on locally adapted land races of common crops as well as new crops of local interest.

There will be short term consequences to this current kerfuffle about piracy, but I wonder if that doesn't simply play into the hands of others who would like to displace the US as leader in GM seed sales to developing countries?

It is worth noting that the skills and facilities needed for agricultural GM would provide a base for other activities in biotech such as pharmaceuticals and that a growing nerd/geek class is very useful for developing countries.

Based on population growth estimates and rising nutritional needs developing countries must double food production in the coming decades just to feed themselves. In that sense this isn't primarily a marketing or export issue, it's a survival issue. If there are customers for agricultural surpluses they will be in other developing countries rather than premium markets in developed countries.

Posted by back40 | January 19, 2004 01:39 PM

You raise two interesting points.

I) Can this be a window of opportunity for alternative biotech suppliers? Competition would be nice, but the entry barriers seem high [would they be low enough if you could ignore patent issues?] It'd be interesting to find out. Do you know anybody with int law background? And how well are the non-commercial initiatives going? If they worked, if biotech became "open source" so to speak, that'd be huge.

II) Developing countries' own demand for food. Will it absorve most of their output? That's an important question. Could you please drop me a link to the proyections you mentioned?

Argentina is a somewhat unique country, a developing country with rich agricultural output and a more-or-less demographically stable population, so that'd not be an issue here. But I don't know elsewhere.

Posted by Marcelo | January 20, 2004 07:54 AM

I think that your speculations about black markets and state sponsored evasions of IP are on target. Two trends in the seed business lead me to think this too:

1) The need is so great. I'll say more on this below in the population growth answer.

2) Apomictic research. Apomixis in the asexual production of genetically identical seeds; natural cloning. Crop plants are being bred that reproduce apomictically, seed without sex. This eliminates problems for seed savers since even apomictic hybrids will breed true. It becomes astonishingly easy for any farmer to become a seed producer.

Timing is a concern, things always take longer than hoped. The window will be open for some time, at least a decade, and there will be battles fought. I suspect that as with most things there will be a series of steps ranging from the current piracy period to alternative supplies from new biotech states such as China and India until IP issues for seed are profoundly altered by apomictic cultivars, which can be understood by analogy to the effects of cheap and ubiquitous CD burners on entertainment and software. The product is the idea rather than a physical entity and ideas spread at the (theoretical) speed of light.

For comprehensive population estimates and projections see

Projections by many models cluster around 9 billion by 2050. We have 6 billion now. To maintain current nutrition levels a growth of 50% food production is needed but current nutrition levels are inadequate. Nearly 1 billion of the current 6 billion humans is "food insecure", meaning that they don't have enough to eat and/or that they are not meeting nutritional needs, especially for children, and that their minds and bodies are stunted. It takes sound minds in sound bodies for economic and social development.

Nearly all of this growth will occur in developing countries. Their fertility rates are falling but are still higher than replacement level. Of the 6 billion humans 1 billion are aged 15-24, prime breeding age. The developed world is old and infertile but the developing world is young and horny.

To feed the new humans and increase the nutrition levels of all humans food production must double. The world doesn't have enough land to do this at current production levels. Developing world lands must rise to developed world levels of production and all of this land will stay in production. Developed world surpluses, including the countries of S. America, will go to the developing world where they are needed. The idea that S. America has a future exporting surpluses to Europe and N. America seems to be a fantasy.

Europe is withering, growing old and losing population. That's not an exciting market for food. N. America is still growing but at a slowing rate mostly driven by immigration. And yet many of the most productive lands are in these developed countries, and they have the best methods and materials, including patented cultivars.

What I see happening is the whole world farming like mad to produce food that will have little market value since the customers for food are too poor to pay even production costs. The alternative is to watch them starve and endure the resulting rebellions. What are the chances that the 1 billion rich humans will survive the rage of the 8 billion hungry humans, especially when the 1 billion rich humans are old farts that have lost productive capacity?

The short game can make some profits in the next decade selling to rich contries, but the long game is a bust. The rich developed countries can't just stop farming and switch to knowledge work since their lands will just have to go back into production to feed the world. The profits made by semi-developed countries in the next decade should be channeled out of agriculture to more valuable economic activities such as manufacturing and knowledge work since agriculture is turning into a non-profit business.

Posted by back40 | January 20, 2004 11:57 AM

" post a comment

remember personal info?

" top
" Slate on Bolivia | Mike Derham
" Version 2.1 | Mike Derham
" The Plan | Miguel Centellas
" Bellydancing And Diplomatic Indicidents | Marcelo
" El Alto & Bolivian politics | Miguel Centellas
" Sachs Bullish on Brazil | Mike Derham
" Tonight we find out | Miguel Centellas
" Mesa's role? | Miguel Centellas
" That's, Of Course, What I've Been Saying All Along | Marcelo
" The Argentine Debt: I'm Not The Only One Wondering | Marcelo
"There's been some attention paid to the role of El Alto (the sprawling slum twin city of La Paz) in national politics. After all, October's guerra del gas was primarily an alteņo affair. It wasn't until after the city of La Paz had been besieged & cut off from the..."
" continue reading El Alto & Bolivian politics...
" partner | sites
Southern Exposure is a member of the living on the planet network of regional sites around the world. For further information click here. Our partner sites include:

" living in india
" economy matters
" living in latin america
" china review
" bonobo land
" boulevard st michel

  © 2022 copyright information " disclaimer " terms of use " credits