Pioneer sees GMOs gaining global market acceptance

By Karl Plume

WASHINGTON (Reuters) - Rising food prices will encourage worldwide acceptance of genetically engineered crops as more consumers set aside health concerns for the lower prices that biotech crops may deliver, a leading seed company executive said.

Governments that have been slow to accept biotech crops, or GMOs, will find it increasingly difficult to deny access to the technologies as food costs are poised to continue climbing.

"The only way we're going to meet some of these demand expectations that we have and are going to have in the future is through improved productivity. A lot of that productivity will come through technology," said Paul Shickler, president of Pioneer Hi-Bred International and vice president of DuPont Co (DD.N).

U.S. food prices rose by a 17-year high of 4 percent last year and were seen rising by another 3 to 4 percent in 2008. Food inflation was expected to outpace the general inflation rate through 2010, the U.S. Agriculture Department forecast.

Global food prices have risen even faster and will continue to do so, economists said.

Current technologies that improve yields by protecting plants against insects or weed killing herbicides are "just the tip of the iceberg," he said on the sidelines of the USDA Agriculture Outlook Forum.

Future developments include soybeans that produce healthier oil or corn with more fermentable starch for ethanol production.

CONSISTENT, RISING YIELDS

GMO seeds have increased corn output in the United States by about 1.5 percent over the past decade and products in Pioneer's pipeline could accelerate that rate of yield improvement to about 3 percent in the next 10 years, Shickler said.

Perhaps more importantly, GMO varieties offer more consistent, reliable yields, which farmers find highly valuable in the current volatile commodities market climate, he said.

"Farmers don't want to be surprised, particularly they don't want to have negative surprises," Shickler said.

"What's going to drive broader acceptance worldwide is the productivity factor, the environmental factor, competition among countries. It's not going to come from the seed industry demanding that they approve. The real demand is going to be driven by farmers," Shickler said.

Since biotech seeds tend to yield more grain per acre, less fuel is needed to plant and harvest the crop -- another selling point for seed companies amid sky-high energy prices.

GMO seeds are already broadly used in the United States, Argentina, and Brazil, and plantings are poised to increase in South Africa, China, India, Canada and elsewhere.

According to the International Service for the Acquisition of Agri-business Applications, 22 countries planted biotech crops in 2006 on 252 million acres.