GM Corn-ucopia In Africa
There will be two important growth drivers for this: Biofuels and livestock. As alternative energies become more popular, corn (which is used to create bio-ethanol in the US and some other countries) production will require increases, particularly since some governments (notably South Africa) have already implemented plans for increased bio-fuel content in gasoline.
Another important growth driver will be poultry production, which uses corn as feed. As poultry production increases to meet rising demand – owing to increasing incomes in emerging markets – more corn will be needed as a result. These two factors will act as strong incentives to increase corn production, and more GM corn use is being seen as a way to do that.
One GM success story is South Africa, which started using GM corn in 1996. It has seen the largest yield increase in corn of all major producers over the last decade, and now has the third highest corn yields in the world behind Mexico and Turkey. Although the adoption of GM seeds is still cost prohibitive in many African countries, rising real GDP growth should help make farming using GM seeds more accessible.
So what are the key implications? For one, despite the forecast production gains, I am still constructive of global corn prices, largely because I feel demand will outstrip supply over the medium term. More locally, I believe GM usage could bring much increased political and social stability to countries that utilise the technology, particularly in Africa. This is because the increased yields (and resulting overall production) will likely help control food price inflation, which is an important part of general inflation in emerging markets. Corn may still become slightly more expensive in the future, but the increased supply should help keep price increases reasonable on a consumer level, and allow countries to maintain tolerable food price inflation levels. This should ultimately outweigh potential ethical concerns regarding GM implementation.