Vilmorin & Cie - Annual report 2017-2018

1 ANNUAL REPORT Vilmorin & Cie 15 2017-2018 GMOs*, a response to new global challenges Genetically modified seeds are one of today’s solutions, helping farmers to rise to major agricultural challenges more efficiently and adapt supply to demand more easily, by producing more and better. Their yield per hectare can, in certain environments, be much higher than that of conventional seeds. They provide greater efficiency to agricultural production, while considerably reducing production costs. And by reducing agrochemical treatment, they indirectly contribute to respecting the environment, and tomorrow they will also make it possible to manage water resources better. Genetically modified seeds fully adopted in certain regions of the world In total, this market represents more than 10% of arable land, with strong variation between different regions. Some countries have fully adopted GMOs*, such as the Americas, where the majority of world GMO* acreage is located. Thus, the United States, Brazil, Argentina and Canada combined represent 85% of world GMO* acreage. In the United States, a precursor, more than 93% of corn acreage is GMO*, rising to 94% for soybean and 100% for sugar beet. And the example of Brazil really is striking: GM* technology for corn was only adopted in 2007 and today its adoption rate already stands at 89%. On the other hand, there are markets which remain to be convinced, particularly in Asia and in Africa. In this respect China, which, to date, represents only 1.5% of cultivated GMO* acreage in the world, is a key country for the future development of genetically modified seeds. However, in certain markets, the prospect of opening up more widely to these technologies today seems less likely; this is the case in Europe, where GM* crops remain marginal, with around 132,000 hectares in 2017. The same is true of India, where the only GM* crop is cotton. (Source: ISAAA 2018) . Higher value for GM* seeds In recent years, genetically modified seeds have repeatedly benefitted from sustained growth in terms of value, at the same time as their progression in volume. Representing more than 21 billion USD in 2017 (an average growth of 3% over the past five years) (Source: Phillips McDougall 2018) , the market for GM* field seeds today represents more than half of the world market for commercial seeds in terms of value. This is particularly due to the integration of several traits* stacked in the same variety. As an indication of how well these technologies have been integrated, and because they provide superior technical performances, genetically modified seeds are sold at a price 100% to 150% above that of conventional seeds, depending on their technical input. More and more frequent trait* stacking Today’s GM* varieties mainly propose three traits*, which are being more and more frequently stacked: resistance to insects (corn borer and corn root worm) and tolerance to herbicides. In 2017, stacked traits represented 41% of the market (Source: ISAAA 2018) , with this figure being even higher for corn seeds. The range of traits* on offer is expanding every year, with traits* providing tolerance to different types of herbicides and different modes of action for insect resistance traits*. The world regulatory environment for GMOs* In 2017, GM* seeds represented 189.8 million hectares (an increase of 4.7 million hectares compared to 2016) cultivated by 17 million farmers in 24 countries, the main ones being the United States, Brazil, Argentina, Canada and India. Corn and soybean are the main genetically modified crops in the world, followed by cotton and canola (spring rape). These productions are used locally for human or animal nutrition or exported to countries that have authorized their consumption. The total number of producing and consuming countries comes to around forty (the European Union counts as just one country). All these countries, without exception, have authorized GMOs* following regulatory examination procedures. Depending on each country, the approach either concerns solely the “product”, or a combination of “technique and product.” A great number of countries have established and apply regulations on GMOs* (http://www.fao.org/food/food-safety-quality/gm-foods- platform/maps/regulatory-framework/en/); some countries also have regulations on imports (http://www.fao.org/food/food-safety-quality/ gm-foods-platform/maps/feed-imports/en/). Source: ISAAA 2018. 1.3. The seed market PRESENTATION of Vilmorin & Cie