Better Growth Investment: Organic or GMO Foods?

What has been the best investment in the last 10

years?

Investment comparison

Growth of U.S. organic food sales

• Totals 4% of all U.S. home food sales

• Produce (43%)

• Dairy (15%)

• Driven by organic cropland growth

Growth of U.S. organic cropland

• From 1997 to 2011…

• Pasture: 350% growth

• Cropland: 226% growth

What about GMO foods and biotech crops?

GMO market penetration

Source: USDA, International Service for the Acquisition of Agri-Biotech Applications Infographic

AgriculturalCrop

Organic % of U.S.

Production

GMO % of U.S.

Production

GMO % of Global

Production

GMO No. of Countries

Grown

Canola --- 90% 30% 4

Corn 0.3% 88% 35% 17

Cotton --- 90% 81% 15

Soybeans 0.2% 94% 81% 11

Growth of global biotech cropland

Source: International Service for the Acquisition of Agri-Biotech Applications Infographic

How do organic and GMO foods, crops compare?

Side-by-side

Organic Crops & Foods Biotech Crops & Foods*

% of U.S. home food sales 4% >88%*

U.S. cropland acreage, 2012

2.97 million acres 171.74 million acres

Contributions to U.S. GDP, 2012

$30.2 billion $125 billion

*foods containing GM ingredients

The most pivotal short-term catalyst?

International Trade & Regulations

Future GMO growth hinges on global acceptance

Source: GMOanswers

Export value of organic foods variable, but growing

Source: USDA, U.S. Department of Commerce

AgriculturalCrop

Organic Export Value, 2011

Organic ExportValue, 2012

% Change

Apples $46.2 million $99.8 million 116%

Cherries $30.6 million $6.4 million (79.1%)

Grapes $60.0 million $39.7 million (33.8%)

Pears $8.9 million $20.6 million 131%

Overall $412 million $448 million 8.7%

Organic catalysts in next 10 years?

Consumer demand for local, labeled products

Big business investments

International trade, exports

GM catalysts in next 10 years?

Population growth stressing shrinking farmland

Big business investments

Next-gen crops offer enhanced

production

Conclusions

• Both organic food and biotech crops will continue high growth for foreseeable future.

• Biotech crops and GMO foods– Positives: Next-gen biotech crops

– Negatives: High global adoption rates = saturation

• Organic crops and foods– Positives: Consumer demand, lack of regulatory

obstacles, plenty of room to grow

– Negatives: Lower yields present risk from environmental factors, farmer fallout

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