From Trials to Commercialization: Global Market Effects of China's Genetically Modified Soybean and Corn Policies

Zhiran Qin and Pierre Merel

No 404675, 2026 Annual Meeting, July 26 - 28, 2026, Kansas City, Missouri from Agricultural and Applied Economics Association

Abstract: China’s transition from prudent pilots to nationwide commercialization of genetically modified (GM) corn and soybeans represents a potentially consequential shift in global crop supply, given the country’s outsized role in world feedgrain and oilseed demand and trade. How a domestic GM rollout transmits through international markets to change production, trade flows, and welfare outcomes is a central but under-studied question, with particular relevance for export-dependent producers and import-dependent consumers. Two foundations motivate the analysis. First, China is actively scaling GM corn and soybean cultivation under a national food-security strategy that prioritizes “bio-breeding”. Second, China’s large demand profile and bilateral trade shares imply that any supply-side shock originating in its domestic agriculture transmits to world prices and welfare in proportion to that exposure. We develop and calibrate a partial equilibrium model of world crop demand and supply, disciplined by observable production, consumption, and trade shares together with behavioral elasticities. We apply a 20% yield improvement to China’s soybean acreage and obtain three main findings. The domestic supply response is large in percentage terms but transmits weakly to consumer-relevant prices, because imports supply the majority of baseline Chinese soybean volume. World-price spillovers are modest, with the largest non-China producer-price decline below 1%. Welfare gains are concentrated in China; Brazil and the United States bear the largest producer losses, though domestic consumer gains partially offset these at the national welfare level.

Keywords: International; Relations/Trade (search for similar items in EconPapers)
Pages: 65
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea26:404675

DOI: 10.22004/ag.econ.404675

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