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Seeds: February 2003
Estimated $25 billion in Major Field Crop Seeds Planted Worldwide in 2002
Note:
Estimates were calculated for all countries by simply multiplying USDA
PS&D “Area Harvested” estimates by “Average Estimated Seed Variable
Cost of Production” based on data from Global Insight, Inc.
Because planted area and abandonment rates were not available, the data
have a slight downward bias. The
variable cost of production data seeks to capture the cost of purchased seed as
well as the opportunity cost of farm-saved seed (the local market price of the
grain or oilseed in question). Seed
cost of production data in US dollars per planted hectare are available from
Global Insight for countries that together represent 55 percent of world total
area for wheat, 75 percent for corn, 73 percent for rice, 88 percent for soy, 34
percent for barley, 43 percent for sorghum, 70 percent for cotton, 42 percent
for sunflower, and 87 percent for rapeseed/colza.
Regional average costs of production from available countries were
applied to countries for which no cost of production estimates were available.
For country/crop combinations with no regional proxy, the average cost of
production for all available countries was used. Despite the obvious
short-comings of this crude method, it is hoped that the results provide an idea
of market size (including informal markets) and growth trends.
The surge in 1996 –1997 and
subsequent decline is explained by both changes in area and seed costs.
In 1996, world total area planted to wheat grew about 5 percent (mainly
due to increased area in China, Russia and the United States).
That same year, world area planted to corn also grew about 5 percent
(mainly in China, the United States and Mexico) and has remained relatively
stable. Soy area surged in 1997 by
almost 10 percent (largely attributable to Brazil and the United States) and has
continued to grow. Meanwhile, the
unweighted average seed cost of production for rice rose from $47 per hectare in
1992 to $66 per hectare in 1996, then fell to $60 per hectare by 1998.
The seed cost per hectare for soybeans rose from $42 in 1992 to $58 in
1996, then fell to $47 by 1999. The
respective seed costs for corn were $37, $46 and $40.
Average seed costs for other crops remained remarkably stable over the
decade, which suggests that in many cases, depreciating currencies relative to
the dollar were offset by rising seed prices.
The estimated annual value of
internationally traded field crop seeds, of the kinds featured in the chart
above, is about $1 billion – only 4 percent of the total world market.
Corn seed accounts for three-fourths of internationally traded field crop
seeds by value (roughly $780 million in MY 2001/02) and amounts to 12 percent of
world corn seed.
Six markets -- the U.S., China, EU, India, Mexico and Brazil -- account for about half of the total field crop seed market. The United States accounts for 18 percent. While still relatively small, the potential markets that have expanded the most since 1990 appear to be in West Africa (notably Togo, Chad and Mali) and Southeast Asia (especially Indonesia and Burma). Potential markets for field crop seeds shrank in much of Southern Africa, Russia and much of Eastern Europe over the past 12 years.