MARKET FORECAST

Seed is the most important input component for productive agriculture. Although theIndian seed
market is one of the largest, it is almost exclusively supplied by locally produced and farmer
saved seeds. Farmers retain seeds of major food crops and commercial crops for many years and
the largest volume of seed trade involves local exchanges ofestablished self-pollinating varieties.
The Seed Replacement Rate in most crops is very low, with the exception of cotton and some
vegetables. The use of hybrid seeds is mostly confined to cotton and to some extent to maize,
millets, sunflower and a few vegetables.

The Seed replacement rate in most crops is very low, with the exception of cotton and some
vegetables.

However, awareness about the high yield and quality of produce from hybrid seeds, is beginning
to attract farmers to switch over to hybrids and GM techniques in many important crops. Many
institutions are also doing extensive research in GN varieties.

The total GM seed market in India is ~5,000 crores, which is relatively small compared toour
agricultural acres and compared to the total value of agricultural produce.

The Government’s consideration to embrace biotechnology as a means of achieving food

Following the easing of government regulations and the implementation of a new seed policy in
2008, the private sector seed companies have started playing a major role in GM seed
development and marketing. The Government’s consideration to embrace GM technology as a
means of achieving food security has attracted several leading biotechnology-focused global
seed companies to India, including Monsanto.

This market will grow strongly on the back of increased hybridization in key crops, increased
farmer realization of the benefits of GM seeds every year and due to newer technologies being
made available.

Indian Agriculture presents an important opportunity for GM crop industry that are focused on
the long term and that are interested in long term value creation. Agricultural development
through the GM seed sector could make India a prospective Agricultural commodity powerhouse
of the world. An effective Indian GM seed industry with the capacity for a continuous supply of
improved high quality seed varieties at competitive prices would serve as a catalyst to increase
food, feed and fibre production and for sustained agricultural and socio-economic development.

MACROECONOMIC FACTORS

Agricultural activities are still greatly dependent upon the vagaries of the monsoonand upon soil
conditions, availability of skilled labor, quality inputs and credit termsas well as global
commodity cycles. agricultural activities are still greatly dependent upon the of the monsoon
and upon soil conditions.
Macro economic factors like the recession, inadequate rainfall, subdued demand,political
uncertainty and acts of god, may affect the business the industry at large.

The business of the industry is dependent on various laws, regulations and policies announced
from time to time. Any developments in these areas affecting the freedom of the industryto
operate may adversely affect the business and growth of the industry.

e.g, MORATIUM on Bt Brinjal by the Ministry of Environment, Govt. of India

Better technologies, that provide better value while mitigating external risks, have been generally
well received both by the government and the farmer.

The GM crop industry in India remains focused on its key objectives of profitable and
sustainable growth, maximizing operational efficiencies and striving to attain the highest
standards of quality, safety and productivity.

Through - continuous breeding research efforts, new product offerings, aggressive sales and
marketing strategies, a strong brand, far-reaching distribution infrastructure and investments in
people development, the Company is hopeful of maintaining its performance going forward.
Efforts at offering better technologies, that provide better value to the farmer, while mitigating
external risks, have been generally well received both by the Government and the farmer.
Continued success in these efforts is critical to maintain these growth prospects.

Most of the commercial applications in GM technology developed so far are directed towards
reducing production costs, not towards meeting the needs expressed by consumers. The
perception of the expected benefits and potential risks of such crops, and of biotechnology as a
whole, differ among regions, countries, interest groups and individuals. The urban and landless
poor in developing countries need cheaper food. In contrast, for consumers in developed
countries, where food is plentiful, the health and environmental concerns associated with
biotechnology outweigh the possible cost savings. These consumers will be more inclined to
accept the new products if they can be assured of their safety through appropriate regulatory
frameworks.

CONCLUSION

Greater and better targeted investments in GM research for developing countries like India will
be needed to ensure that the farmers of these countries have access to the resulting new crop
varieties. The focus should shift from pesticide-tolerant crops towards the characteristics that
matter to resource-poor farmers: improved resistance or tolerance to drought, water logging,
salinity and extreme temperatures; improved resistance to pests and diseases; better nutritional
values; and higher yields. Such a shift could be based on new private-public partnerships,
exploiting the greater efficiency of private-sector research but under the guidance of govt.
institutions.

USAGE RATE
In India GM crops usage rate is mainly the Bt cotton used by the farmers of following states.
 During 2007-08 cotton was grown on 9.44 mha in nine states of India, of which more than 80% was
sown to Bt cotton. Cotton production in this year was 31.5million bales (mba) or 5.4 million tonnes (mt).
The largest cotton growing state was Maharashtra (3.19 mha), followed by Gujarat (2.42 mha), Andhra
Pradesh (1.3 mha or 18%). Gujarat achieved the highest production and yield, the latter ranging 330 kg/ha
to 786 kg/ha across all states with an average of 567 kg/ha.