Abstract: As one of the three large and scientifically advanced countries of Latin America, Mexico possesses several key advantages over the smaller countries in attempting to access the benefits of agricultural biotechnology. It is large in terms of total agricultural area and has seed markets of sufficient potential to attract private sector investment. Mexico has a strong university-based basic research capacity and a large national agricultural research system. Drawing on these capacities, Mexico has been able to establish a credible biosafety framework and has accumulated significant experience with biosafety regulation. Drawing on this scientific capacity, Mexico has been a leader in the testing and approval of transgenic crops (GMOs). The country's first biosafety field trials, for FLAVR SAVR® tomatoes, were conducted in 1988 and by 2000, 147 field trials had been conducted. Only eight countries in the world had conducted more GMO field trials than Mexico. The private sector has dominated field testing with 80% of all trials.

Mexico has a three stage biosafety approval process. The first stage is permission to conduct field trials, the second is permission for "limited" commercial use, and the third is approval for full commercial use. Limited commercial use has no set area limit. Bt cotton, which has been sown to an average of about 25,000 ha annually between 1998 and 2000, is currently grown under a limited commercial use permit and only FLAVR SAVR® tomato has yet been approved for full commercial use. Limited commercial plantings, ranging from 2 to 12.5 ha of other transgenic tomatoes, melon, potato and squash, 900 ha of herbicide resistant soybeans and up to 37,000 ha of cotton have been planted in Mexico. A moratorium has been placed on field testing of transgenic maize out of concern for the effect that pollen outflows might have on native populations of tripsacum and teocinte, wild relatives of maize, even though neither wild species grows near major maize growing areas in the northern half of the country.

We examined the farm level impact of Bt cotton in the Torreón area of Coahuila, Mexico. An average of 200,000 hectares of cotton, 90% of it irrigated, were grown in Mexico in the 1990s. Area fell to just 79,581 ha in 2000 due to scarcity of water. About a third of the total cotton area in 2000 was sown to Bt cotton. Adoption varied from less than ten percent in Sinaloa and Baja California to 96% in Coahuila. Patterns of infestation levels and economic losses vary widely across the main growing regions and have been important determinants of adoption of Bt cotton. Bt cotton is 100% effective in controlling two of the seven major insect pests that plague cotton in Mexico and is partially effective in controlling two others. Bt cotton is more valuable in regions where the controlled insects, the pink bollworm and budworm, cause the largest economic damages. Where boll weevil or other pest populations are high, farmers achieve coincidental control through the use of broad-spectrum chemicals, or pesticide mixtures, reducing the value of Bt control.

Bt cotton was introduced in Mexico in 1996 through a strategic alliance between Monsanto and the dominant U.S. seed cotton firm, Delta and Pine Land Co. (D&PL). The same D&PL Bt varieties that are grown in the US have subsequently been marketed in five other countries, Argentina, Australia, China, South Africa and Mexico. Monsanto and D&PL maintain an agronomic research presence in Mexico, but do not do any plant breeding there. Seed sales and distribution are handled through regional agricultural input distributors. Monsanto provides sales support through a national office in Mexico City, and through two technical representatives located in the main cotton growing areas.

Producers in the Coahuila region are a mixture of ejidarios and small landholders. The ejidatario holdings averaging 2-10 has, were formed during one of Mexico's several land reforms. The small landholders are larger, averaging 30-100 ha. Producers from both groups are organized into farmer associations, with centralized accounting, management and technical staff for the purpose of qualifying for credit. A contracted agronomist makes most production decisions for association members with relatively little involvement from individual landholders. Because of the link that the associations provide with credit provision, they serve as a very effective conduit for information about new technologies and have undoubtedly served to speed the adoption of Bt cotton varieties.

Pesticide use have fallen dramatically in the 1990s. The total amount of active ingredient applied to cotton in 1999 was just two percent of the amount applied in 1988, per ha pesticide use has fallen by more than 80%, and the average number of pesticide applications has fallen from more than six in the mid-1990s to two in 2000. Bt cotton has been an important tool in reducing pesticide use, but has not been the only factor -- reduced cotton acreage, government sponsored pest control programs, and the eradication of the boll weevil have also contributed.

An estimated $US 2.7 million in economic benefits were generated annually by the introduction of Bt cotton in Coahuila. Of this, about 85% accrued to farmers and 15% to seed suppliers. Adopting farmers spent $100 less on pest control and had $295/ha higher net revenue than non-adopting farmers. The average size holding of adopting farmers was 14 ha compared to 9 ha for non-adopters.

In summary, Bt cotton has been a valuable technology for certain areas in Mexico, permitting large reductions in pesticide use and providing large benefits to farmers. Cotton profitability and competitiveness have increased, and the risk of crop failure from insect infestation has been reduced. The region's victory over the Pink Bollworm, once the dominant insect pest, would not have been possible without Bt cotton. At the same time, because Bt cotton only protects against a certain spectrum of the pest population, it is not a cure-all for all regions and adoption still stands at 33%. Three government interventions were key in stimulating the use of Bt cotton in Coahuila ­ 1) credit for financing the purchase of Bt cotton seed, 2) technical assistance for small landholders, and 3) an effective integrated cotton pest management program.