The only gm crops used in the developing world so far are BT cotton and canola, popular in India and China. Pesticide use has dropped 42 percent in India in 2005 as a result of BT cotton, but controversy has erupted as to whether the cotton is as productive as non-BT strains.
The benefits to date for farmers using gm seeds have not been larger crops—yields of gm soybeans run about 10 percent less than non-gm beans—but savings on chemicals and labor.
In April, a multinational review on the future of food production found that gm foods haven't been around long enough for researchers to know how they will affect human health and the environment. Genes from gm crops can drift into nonengineered crops, which threatens organic farmers and could destroy native plant strains. Mexico approved limited use of gm corn earlier this year but only after buffer zones were established to protect native corn.
Traditional plant breeding has been eclipsed by the hype surrounding gm crops. But even traditional breeders say there is much they can do to improve yields. This includes so-called transgenic methods, which tackle fungus and insects, and marker-assisted breeding, in which genes associated with desirable traits are tagged to speed up the breeding process.
In sub-Saharan Africa, the International Maize and Wheat Improvement Center has been working with local scientists to develop drought-resistant strains of corn, including open-pollinated varieties that can be replanted from saved seeds. More than 50 of these strains and hybrids have been created, with yields 20 to 50 percent higher than regular strains in a drought.
Curb the Speculators
Tom Buis, president of the national farmers union, calls it "the factor no one wants to talk about." The weak dollar has led to high commodity prices as pension, hedge, and index funds have bought oil, gold, and agricultural futures as a hedge against inflation. Although the U.S. farm industry relies on the commodity markets to manage its own risks, now it argues that change is needed—even curbing some of the same measures used to attract money to the market just a few years ago. "I think we have to make sure that policy is in place to prevent speculators from dominating the market," says Buis, who fears a bubble is building that could hurt farmers in the end.
Among the suggested solutions: freeze the number of contracts speculators can hold, or place higher price limits on markets. The Commodity Futures Trading Commission, which regulates grain markets, remains wary. CFTC Commissioner Bart Chilton says that while the increase in cash flowing into the sector has changed the way grain markets operate, there is no direct link between speculators and the jump in prices. "No single speculative group is responsible for affecting prices. There's no smoking gun out there," he says. "It does appear to be a reflection of real market fundamentals."
Darin Newsom, of commodities researcher DTN, says one possible solution for farmers who are concerned about a commodities bubble is to move their traditional risk-hedging activities into other types of swap contracts in which the impact of speculators is less apparent, essentially shifting to a different corner of the market until existing futures trading cools off.
Good weather, bumper harvests, a change in ethanol policy—any of these could take the heat off the market. Of course, another step that could do the trick would be unpopular on Wall Street: the Federal Reserve tightening U.S. monetary policy through higher interest rates.
Break Down Trade Barriers
Politics often kicks into high gear in times of crisis. That's what happened when India, Egypt, and dozens of other countries dropped their tariffs and taxes on imported foodstuffs to get cheap food as fast as possible. Doing so, they accomplished in just the past few months what over six years of trade negotiations, called the Doha Round, could not. "Imports have been liberalized in a way that not even the wildest trade enthusiasts would have imagined," says Arvind Subramanian, senior fellow at the Peterson Institute for International Economics.