It should be noted, however, that propanil drift is known to cause significant damage to fruit trees and cotton, and the chemical was banned in some areas at one point in the 1960s . Both propanil and glufosinate achieved comparable control of the watergrass weed, prompting the authors to conclude that both are “options to control multiple-resistant watergrass. For these treatments to be effective in the long term, [watergrass] seed rain reinfestations still need to be much lower” . In other words, to control the weed in the future, multiple applications of each herbicide may be necessary, reducing the profitability of the transgenic system. In response to this conclusion, the second trial year included two applications of varying chemicals for each herbicide regime with two treatments of propanil on conventional M-202 rice in the rotate-mode-of-action regime and two treatments of glufosinate on the LibertyLink® plots. Two issues with regard to this year warrant mentioning. First, the initial planting of LibertyLink® seed showed poor germination and was reseeded at 17 days after submergence . The additional reseeding costs are included in Table 8. Second, the researches mistakenly applied 350 g AI/ha of glufosinate in the first application rather than the recommended 500 g AI/ha. This presumably decreases both yields and costs, ceteris paribus, although watergrass control was still estimated at approximately 99.99 percent for this treatment regime . The economic results show that the intensive combination regime based on herbicide tank mixes is economically inferior with very small returns relative to the others due to relatively large herbicide material and application costs and little yield advantage.
The propanil treatments again outperformed the transgenic regime in terms of yields and returns with advantages of 11 and 6 percent, respectively, vertical grow racks despite significantly higher herbicide costs. However, seeding costs for the transgenic variety were twice as high due to the reseeding. The authors of the watergrass study attributed this poor germination to “the experimental nature of the LibertyLink® rice seed used in this experiment” . If the same yield results could be obtained without reseeding, the transgenic variety would dominate the alternative treatments with net returns of approximately $237.39, 11.8 percent higher than the next best alternative . Furthermore, the transgenic regime offered better control of watergrass than the rotational treatment . The 2001 growing season offered the opportunity for the third and final year of the Fischer project. No propanil treatment regimes were included in this final year, and all but the transgenic regimes used multiple applications of chemical herbicides. Given the germination problems in the previous year, the seeding rate of LibertyLink® rice was increased from 1.5 to 2 pounds per acre and these increased costs are reflected in the results presented in Table 8. Of the four treatment regimes compared in this year, the transgenic variety offered the highest returns—2 percent above the next best option . The intensive combination offered the highest yields but lowest economic performance due to the high cost of herbicide material and applications. It should be noted that, even with the higher seeding rate, the continuous glufosinate regime with LibertyLink® rice in this final year offered the highest returns of any of the years. Perhaps more significantly, when taken as a three-year program of management, the regime offered returns that were 72 percent, 68 percent, and 1 percent greater than the continuous-molinate, intensivecombination, and rotation-mode-of-action regimes.
However, the undiscounted difference between the two best alternatives is $9.20 per acre, part of which would likely be as a technology fee. The authors of the Fischer study concluded the following in their 2002 final report: “Overall, the use of glufosinate on transgenic LibertyLink® rice has demonstrated its potential as a viable strategy for the control of thiocarbamate-resistant watergrass.” The economic results presented here, based partially on those findings, suggest that a transgenic weed-management strategy can be, at the very least, competitive with alternative pest-control regimes such as herbicideaction rotation. Overall benefits of such a program, however, are subject to individual growing conditions, market acceptance, and the pricing strategy of the technology owners.Most commercial rice production in the Sacramento Valley region is cultivated under flooded conditions and is heavily dependent on chemical herbicides and insecticides to control weeds and insect pests. Release of the standing water into the Sacramento Valley watershed is thus an important negative externality arising from rice farming and one that may be affected by introduction of transgenic varieties.19 For example, in the early 1980s, a large number of fish were killed as a result of molinate poisoning in rice water drainage areas while small levels of thiobencarb were found to adversely affect the taste of drinking water . These findings led to implementation of the Rice Pesticides Program by DPR in 1983 . The program was originally designed to reduce molinate and thiobencarb pollution of local waterways and expanded in the early 1990s to include performance goals for these and the insecticides methyl parathion and malathion and to address damage done by drift and dust from aerial application of herbicides . Other chemicals such as bentazon have been prohibited or at least restricted in geographic use as in the case of propanil . Furthermore, the Central Valley office of the California Regional Water Quality Control Board passed an amended conditional waiver of waste discharge requirements for irrigated lands in 2003.
This waiver tightens quality standards for water released from agricultural uses in the Central Valley as well as requires monitoring and reporting of water quality and implementation of management practices that improve the quality of discharged water. Coverage under the conditional waiver can take the form of a “coalition group” with a common interest, such as the rice industry, and CRC has indicated that a commodity-specific rice waiver is preferred . Efforts to obtain this specific waiver are ongoing and have been received favorably by the board given the success of the rice pesticides program . Many of the chemicals currently registered for use on rice in California require holding periods for floodwaters that range from four to fifty-eight days in length and vary by water-management system . Ideally, these programs allow the chemicals to degrade in the water, resulting in ambient concentrations at least 90 to 99 percent less than the initial application . While these programs are generally effective in holding ambient concentrations at monitoring stations at or below maximum allowable levels, with some exceptions, significant holding periods can affect water depth and salinity within farms and thus initial establishment of rice plants and yields . The program has been quite successful; peak molinate concentrations have been reduced by better than 90 percent in the Sacramento River and Colusa Basin Drain since the beginning of monitoring and thiobencarb concentrations have declined as well, although by a lesser percentage . It should be noted that peak concentrations are an imperfect indicator as weather events and other sources of variability can significantly affect detectable levels of these chemicals. The environmental and health effects of leaching and runoff of chemicals in U.S. agriculture are diffi- cult to quantify, grow roon design primarily due to measurement issues and uncertainty. Approaches to estimation of these external costs vary and include using abatement or clean-up costs directly; developing proxy variables for environmental damage, including pounds of AI applied or indices of chemical properties; and assuming a dollar value per unit of damage. Contingent valuation methods have also been used to estimate consumers’ willingness-to-pay to avoid exposure through risk reduction . Although admittedly simplistic, one proxy for environmental damage is total pounds of chemicals applied. Based on 2002 acreage and use figures from DPR and the chemical labels, approximately 17.2 million pounds of herbicides were applied that year with 3.86 million pounds of active chemical ingredient. As shown in Table 3, total pounds of chemical herbicides applied per acre are expected to decrease by at least 84 percent with adoption of the HT system and total poundage of AI is predicted to decrease by at least 87 percent under the two-treatment scenario. Cultivation of HT rice could thus decrease total herbicide poundage by between 7.27 and 10.9 million pounds and AI poundage by between 1.69 and 2.53 million pounds, assuming 50 to 75 percent adoption. However, this simple measure ignores toxicity, mobility, and persistence of different chemicals in the soil and water that are likely to significantly affect external damage costs . Similarly, the mandatory water-holding periods currently in place are designed to dissipate the damage done by conventional chemicals.20 While this study makes no attempt to further quantify the reduced chemical damages from adoption of transgenic rice, several other projects have addressed the relationship between water quality and HT crops and are summarized in Gustafson. Computer-simulation models used by the U.S. Environmental Protection Agency have predicted lower levels of chemical concentrations in runoff from transgenic corn systems than from conventional corn production. Furthermore, the herbicides used in the transgenic system have a “favorable chemical profile” in that EPA’s water-quality standards allow for greater concentrations of these chemicals in water than the traditional herbicides used in conventional corn production . Case studies cited in Gustafson for Bt cotton, HT corn, and HT soybeans confirm these results since concentrations of herbicides in watersheds were well below standards for a number of diverse geographic areas. We conclude that, while most, if not all, pesticides applied in agricultural systems introduce some degree of risk and thus potential damage to the environment, the reduced application rates and chemical properties of glyphosate and glufosinate have the potential to further reduce external damage costs from rice production. In addition, production benefits, specifically in terms of yields, may be enhanced if the holding period for floodwater is reduced for the transgenic system due to the lowered toxicity of the associated chemicals. This is in accordance with previous studies that concluded that cultivation of transgenic crops, in general, is consistent with increased environmental stewardship . However, it should be noted that these conclusions are based on the assumption that weeds resistant to currently available chemical controls in California do not exhibit this property towards glyphosate and glufosinate. As with many chemical agents, repeated applications of the same AI on the same plot may result in self-selection of weed varieties resistant to that ingredient, thus potentially reducing the environmental benefits of transgenic-crop cultivation in the long run as producers increase applications or shift to alternative means of control.This study has used a static, partial-budgeting approach to estimate the potential net economic grower benefits associated with adoption of one cultivar of GM rice in California. Scenarios were developed based on average cost data and actual pesticide-use data, as well as on a three-year field study of herbicide resistant weeds. Sensitivity analysis was conducted using both deterministic and stochastic methods to represent heterogeneity across growers and uncertainty regarding modeling assumptions. The results suggest that a production strategy including GM rice varieties could lead to significant economic benefits for many growers in at least the near term. Those most likely to benefit from adoption of transgenic rice are growers with relatively high herbicide material and application costs, likely as a result of weed resistance, and those who are restricted to certain chemical agents as a result of state or national regulations. Field-trial results suggested that a transgenic weed-management strategy over multiple years is competitive with a rotational strategy under certain assumptions and dominates a continuous-molinate and intensive-herbicide regime. These findings are generally consistent with ex post transgenic crop analyses for corn, soybeans, and cotton, most of which show positive or neutral economic benefits from adoption . In addition, water quality degradation is not likely to occur with transgenic rice adoption as chemical-application rates are expected to sharply decline and the toxicity of the associated chemicals is generally less than more traditional herbicides. We must point out that this study has certain limitations. First, these results are based in large part on ex ante assumptions regarding outputs and inputs, especially the relatively lower cost of glufosinate herbicide per gallon relative to the alternatives. It is expected that Bayer CropScience will set the price of glufosinate in accordance with its portfolio of transgenic crops , so the introduction of transgenic rice will not affect the price of this herbicide.