Transcript Biotechnology Effects on the North Dakota Corn Industry

Corn Industry Trends
Tom Lilja
[email protected]
December 18, 2013
Ag Revolutions
Mechanical – 1794 Cotton Gin
Chemical – Post World War II
Financial – 1980’s collapse
Biotechnology – mid 1990’s
Protein Revolution today?? Or Logistical??
Fundamental Demand Changes Occurring
World Population
Millions
8,000
7,000
6,000
5,000
4,000
3,000
2,000
1,000
0
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
3
Chinese Domestic Corn Feed Demand
MMT
120
100
80
60
40
20
0
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
4
Per Capita GDP Rates in SE
Asia
China
India
$6,000
$1,800
$1,600
$5,000
$1,400
$4,000
$1,200
$1,000
$3,000
$800
$600
$2,000
$400
$1,000
$200
$0
1982
1986
1990
1994
1998
2002
2006
2010
$0
1980 1984 1988 1992 1996 2000 2004 2008 2012
5
19
80
19
82
19
84
19
86
19
88
19
90
19
92
19
94
19
96
19
98
20
00
20
02
20
04
20
06
20
08
20
10
Delta in World Meat Demand
BRIC
EU & US
300%
250%
200%
150%
100%
50%
0%
6
Doubting Thomas
Malthusian Theory – population is inclined
to increase more rapidly than the supply of
food that such growth necessitates
Can we disprove Malthus?
Yield Enhancement
Drought Tolerance
More Corn Per Acre
North Dakota Yield Variability 28%
1975-1995
100
90
80
70
60
50
ND Avg Yield
40
30
20
10
0
1975
1979
1983
1986
1988
1992
1995
North Dakota Yield Stability 15%
1997-2010
140
120
100
80
ND Avg Yield
60
40
20
0
1997
1999
2001
2003
2005
2007
2010
What Helped Stabilize Yield?
• Corn Borer trait (Bt) introduction
1997 Southeast North Dakota
NK 3030 115 bushels / acre
NK 3030BT 141 bushels / acre
• Roundup Ready technology in corn and
soybeans has not stunted plant growth as
with traditional chemicals
• Corn Rootworm Traits
• Stacking of Traits
Supply Side Economics ??
90 bushels / acre – mid 1990’s
115 bushels / acre – 2012
25 extra bushels across 3.5 million acres
Or Bonanza??
87.5 million more bushels x $6.67 USDA
$584 million more to ND economy
$2.47 Billion (2004-2008) CAPTS, NDSU
$9.7 Billion (2008-2012) CAPTS, NDSU
Corn’s Impacts, 1987-2007
Land Use
Soil Loss
Irrigation
Energy
Climate
Amount of land
to produce one
bushel of corn
Soil loss per
bushel, above a
tolerable level
Irrigation water
use per bushel
Energy used to
produce one
bushel
Emissions per
bushel
37%
69%
27%
37%
30%
Pesticide Use Trends
Increasing adoption of hybrids with insect-resistant and
herbicide-tolerant traits have greatly reduced the need for
synthetic applications of herbicides and insecticides.
Insecticide Pounds Per Acre
0.35
Herbicide Pounds Per Acre
3.5
0.3
3
0.25
2.5
0.2
0.15
2
0.1
1.5
0.05
1
0
0.5
1990
1995
2000
2005
0
1990
1992
1994
1996
1998
2000
2002
2005
Source: USDA
COMMERCIAL NITROGEN APPLIED PER BUSHEL OF CORN PRODUCED
Pounds per Bushel
1980 - 2006 ACTUAL & TREND TO 2030
1.80
Actual
1.60
Trend
1.40
1.20
1.00
0.80
0.60
Corn Growers Become
More Efficient With Nitrogen
0.40
0.20
0.00
1980
1985
1990
1995
2000
2005
2010
2015
2020
2025
2030
Source: Blue, Johnson & Associates, Inc.
Source: Blue, Johnson & Assoc. Inc.
Enjoy the Value Added Summit
Contact Info
Tom Lilja – [email protected]
Greg LaPlante – [email protected]