Regarding price, non-Bt users received more money for their corn than Bt users, but that could be a function of the market paying more for non-genetically enhanced hybrids. The economists also found that increases in seed prices reduce the demand, but increases in insecticide prices appear to decrease seed demand, which they say implies that seed and insecticides are complementary in the production process. And with Bt adoption, Bt seed use increases profits, yields, and seed demand. Specifically, a 10% increase in Bt adoption was associated with a $2.89 per acre increase in profits and a 1.72 bushel per acre increase in yields.
The 2005 data did not indicate any impact on insecticide demand, but they report that insect infestation levels were lower in 2005, and as a result less was used. The researchers add, “This may have reduced the impact of Bt adoption on insecticide use. After all, farmers only use insecticides if treating pest infestations is expected to be profitable. In other words, farmers only use insecticides if infestation levels are above a certain threshold. Below this threshold, Bt adoption should not affect insecticide use.”
Although the reduced insect infestation in 2005 could be an issue, the USDA economists say the important take home information is that variable profits were $18.84 higher per acre with Bt hybrids, as the result of corn yields 17 bushels higher. But they say their results suggest that Bt adoption is not significantly related to insecticide use.