Economic benefits of GM crops small, study concludes

The economic benefits from growing genetically modified crops in Britain are likely to be limited, at least in the short term, a government report said yesterday, in a conclusion expected to be extremely unwelcome for Tony Blair.

Only a narrow range of existing GM crops is suited to British conditions, and the demand for any GM products, and therefore their value, is likely to be small because consumers do not want them, the study from the strategy unit of the Cabinet Office says.

Furthermore any "small-scale" economic benefits obtained by growing the current range of GM crops are likely to be outweighed by other developments, such as changes in the European Union's Common Agricultural Policy, the report says.

That the Government's own civil servants have been unable to find any compelling economic reasons for introducing GM technology will be a serious blow to Mr Blair, Margaret Beckett, the Environment Secretary, and other prominent supporters who hope to see GM crops authorised for commercial growth in Britain this autumn.

The report was seized on by opponents of the technology as proving that the Government's case was flawed. Charlie Kronik, a GM campaigner for Greenpeace, said: "It totally fails to justify Tony Blair's determination to invest in this unpredictable technology."

The strategy unit study is one of three government projects meant to prepare the way for the decision on GM commercialisation, the others being the national GM debate, which ends next Friday, and the review of GM science, due to be published on 21 July.

The study does not contain specific recommendations to the Government but is meant to inform policy making on GM crops and foods. It looks both at crops that are currently available, and at possible developments over the next 10 to 15 years. The four proposed for growth in Britain are all herbicide-tolerant, meaning they are designed to allow the application of very powerful weedkillers.

The study's main conclusion is that "GM crops could offer some cost and convenience advantages to UK farmers now, and future developments in GM crops have the potential to offer more wide-ranging benefits both to farmers and consumers.

"However, at least in the short term, weak consumer demand is expected to limit the demand for products containing GM foods, and therefore the economic value of the current generation of GM crops."

Possible benefits are also offset by the fact that some of the most widely cultivated GM crops, such as soya beans and cotton, are not suited to the British climate. The present narrow range of GM crops available and suited to Britain offer "some benefits to farmers" but "do not yet offer discernible benefits to consumers", the report says.

Even the benefits to farmers are heavily qualified by the study, which says that they would have to be balanced against the cost of buying the technology, and the cost of complying with new regulations.

The report's authors suggest that the only market for crops proposed for growth in Britain is likely to be in cattle feed.

The possible adverse costs could be significant, the report says, if, for example, a non-GM product had to be withdrawn from the market because of GM contamination. But it says these cannot be quantified until the Government brings in a regime defining how GM and non-GM crops can coexist, and making clear who is legally liable if things go wrong.

The Environment minister Elliot Morley said: "The report highlights that GM crops are one area in which GM technology has significant potential to contribute to the UK's future economic prosperity and sustainability. But it also points out that GM crops are just one possible tool for achieving our goals - important advances in crop production will also come from conventional and organic techniques."

Peter Melchett, policy director at the Soil Association, the organic food and farming lobby group, took a different view. "This is a careful economic analysis which shows that there are no clear, immediate economic benefits to UK farming if GM crops are grown commercially," he said. "Although the government spin on the report suggests that [it says] there will be GM jam tomorrow - in the form of long-term economic benefits - it doesn't. The report says that the potential long-term benefit 'needs to be balanced against the possibility that new GM crops could introduce new risks'."

The other cabinet office studies on the way

SCIENCE

The Government's GM science review - a companion study to the costs-and-benefits report - is examining all the academic research and testing on GM crops and foods. It is also trying to determine what is not known about the technology. The review, produced by a panel of more than 20 leading scientists, is due for publication a week on Monday - if the different factions on the panel (which is known to include supporters and opponents of GM technology) can agree on the conclusions.

FARMING

For many people, the key question in the whole debate on growing GM crops in Britain concerns the powerful weedkillers that the plants have been genetically engineered to tolerate. Will the widespread application of these "broad-spectrum" (meaning, they kill all other plants in the field) herbicides merely bring about a further intensification of the intensive farming that has so damaged the British countryside? A three-year programme of trials is just finishing and is expected to report in September.

HOW CLOSE? WHO PAYS FOR DAMAGE?

Just how near to a conventional or an organic farm can a GM farm be sited? What happens if pollen from a GM crop contaminates an organic one and renders it worthless? Who is liable for damages? The GM farmer? The GM seed company? The Government? No one has decided yet. But these important and linked questions, known in the jargon as "co-existence and liability", will soon be the subject of a report from the Government's GM technical advisers, the Agricultural and Environment Biotechnology Commission.

CANADA

Stewart Wells, president of Canada's National Farmers Union, said the introduction of GM crops in Canada had been far from completely beneficial. He claimed yesterday that their disadvantages had been "undersold". These included the GM contamination of the whole Canadian national seed stock of conventional oil seed rape, and the fact that more weedkillers, not fewer, had eventually to be used. GM crops had not lived up to their promise of increased yields with reduced costs, he said.