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Giant Views of The Industry

Our feet are firmly planted in the new decade, and changes in the seed industry are happening faster than ever. Technology is booming and the world is shrinking. Six experts from this year’s Giant Views of the Industry discuss the trends affecting your business today, providing advice on how to survive the next 25 years.

PLANT BREEDING and biotechnology have changed the speed of the seed industry. The capacity to produce new varieties is greater than ever, but the life span of varieties isn’t the primary determinant of speed in the industry anymore. Many rapidly evolving factors will shape the business, such as new traits, biofuels, food quality issues, globalization and a shift in the end user (farmers aren’t the only customers anymore).

Advanced technology is the biggest driver in today’s evolving industry. There has been talk of the next generation of traits, such as drought tolerance and nitrogen use efficiency, for many years but, for the most part, these traits haven’t come to market yet. In part, this is due to an overburdened regulatory system, and many feel this decade will finally see the commercialization of many exciting new traits.

The Decade of Biotech

Giant-Views-of-the-Industry-1“The last 10-12 years we’ve had around 33 traits developed and commercialized,” says Janice Tranberg of CropLife Canada. “We’re expecting within the next 5-10 years an additional 90 traits and if you add combinations of those traits, that number could even get higher. Around the world we now have 25 countries that are growing biotech crops and we have even more that are researching and bringing traits forward. So, as this trend continues, I think the acceptance is going to happen no matter what and it is increasing because people are seeing the benefits.

Plant breeding and biotechnology have changed the speed of the seed industry. The capacity to produce new varieties is greater than ever, but the life span of varieties isn’t the primary determinant of speed in the industry anymore. Many rapidly evolving factors will shape the business, such as new traits, biofuels, food quality issues, globalization and a shift in the end user (farmers aren’t the only customers anymore).

Advanced technology is the biggest driver in today’s evolving industry. There has been talk of the next generation of traits, such as drought tolerance and nitrogen use efficiency, for many years but, for the most part, these traits haven’t come to market yet. In part, this is due to an overburdened regulatory system, and many feel this decade will finally see the commercialization of many exciting new traits.

Addressing Trade Issues

Several trade issues have cropped up over the past two years, and with more biotech traits coming down the pipeline it’s an issue that will only get worse. Many companies and associations in Canada are working on solutions to make trade issues easier to manage.

“At CropLife Canada, one of the things we’re working hard on is helping Canada develop a policy that is transparent and flexible around low level presence or LLP,” says Tranberg. “So, what I mean by this is products found in import shipments that have been commercialized and approved in one or more countries, but not the country of import, and are found at very low levels.” Tranberg believes policies need to be developed so countries can deal with LLP without stopping shipments at their borders due to trace amounts of genetically modified seeds with a full approval in other countries.

The combination of more traits and improved detection technologies means it’s going to be increasingly important to identify and look at solutions for LLP, continues Tranberg. “These policies need to be internationally recognized and they need to be something that we can work on across the globe,” says Tranberg, adding that Canada’s starting with its domestic policy and then, “the country will work at communicating this policy to the rest of the world.”

Certainly, communication remains key to coming up with solutions and David Hansen from Canterra Seeds can’t stress that enough. “There’s always room for improvement to make sure the right parties are involved in the dialogues between countries and organizations involved in a trade dispute,” says Hansen. “In certain situations, more effective communication may have helped minimize the impact of certain disputes, or at least provided th industry with knowledge of the problems at an earlier date. Some of these issues are impossible to anticipate, but when they do come about, we need to talk about them earlier, as a group and as an industry, with government agencies as well as trade groups.”

Specialized Trait Developers

Giant-Views-of-the-Industry-2Traits are beginning to flow from other companies—not only the big six. Many big companies are partnering with smaller trait development companies to commercialize both biotech and non-biotech traits such as drought tolerance and nitrogen utilization. Big companies are frequently partnering with these specialized companies to advance their breeding programs.

“We are a trait development company that allows companies to put a particular trait into a plant, without the regulatory burden,” says David Voss of Cibus. “Some products that are soon to be entering the market were developed by our technology and will be carried forward with some major companies. Some of the media like to put us against some of the major players in agriculture which really is unfair because, in reality, we’re really actually partners with many of these major companies.”

Some of Cibus’ partnerships include major companies like BASF and Mahkteshim, as well as smaller organizations such as the Flax Council of Canada. “The Flax Council approached us to develop a particular trait in flax. They, as an industry, are striving for new technology. Very little input of technology has been used in this crop. Farmers are looking for alternative technologies,” says Voss.

The company’s main target is Europe, due to the fact that its technology is not transgenic. “We’ve actually had several scientist groups in Europe look at our technology and they’ve also come to the same conclusion—that we are a mutagenesis technology,” says Voss. “And that is very key for Europe because Europe actually goes out of its way to exclude mutagenesis in its directive of GMOs.”

Closer to home, companies are also coming up with new technologies in the form of alternative crops. BASF Canada has partnered with Viterra in the development of brassica juncea and Harley House of BASF feels the opportunities are endless.

“Juncea allows growers in the brown soil zone and some of the non-traditional canola growing areas to introduce a crop that has drought and heat stress tolerance as well as frost tolerance,” says House. “Traditionally, growers in the brown soil zone have had limited oil seed crops to use in their crop rotations and so we see that as a large benefit to them … also, inherently the crop has pod shattering resistance and that’ll be a big benefit to people wanting to straight combine and not have to swath the crop. This will appeal to both new growers in the brown soil zone as well as existing canola growers.”

IP Rages On

With new traits and opportunities on the horizon, the Canadian seed sector is still struggling with its biggest challenge—return on investment through intellectual property protection.

Lorne Hadley of the Canadian Plant Technology Agency says the situation in Canada is really quite simple. Countries such as Canada that still use UPOV 1978 and have not adopted the revised 1991 UPOV are falling behind and it shows. The 1991 revision of UPOV further balances plant breeding rights versus farmers’ privilege to retain seed for their own use. UPOV 1991 is becoming a global standard to follow in both developed and developing countries.

“We talk about patents, we talk about plant breeders’ rights, we talk about plant variety patents and contracts, and each of these tools has a specific use and I don’t think each specific use is very well understood. Canada has to come to the table and update our plant breeders’ rights laws to UPOV 91. We’ve said we’re going to do it, we haven’t actually done it and that would be a big step for Canadian developers,” says Hadley. “We ran into some problems politically and were unable to move forward, but it’s time that we said we stand up for innovation, we stand up for respect for the legitimate interests for breeders and we want to move forward with this. Ultimately, by getting new products primary producers and Canada in general will benefit.”

Hadley says the most successful techniques in IP enforcement that he has seen companies use is, “a simple tactic that companies put into their sales techniques, where they say ‘If you don’t plan on living up to the IP agreement that we have, please don’t buy our product.’ And by doing that they’re saying, ‘This is of value to you, we’re selling it to you at a good price and we expect you to honour the contracts and agreements we have,’” says Hadley.

Of course, a conversation on IP doesn’t go very far without the mention of return on investment because that is, after all, the real issue behind IP. Hadley says the bottom line is that the industry has to get the percentage of certified seed sold up. “We need to take the actions like the pedigreed seed tax credit, like encouraging farmers on an agronomic basis to use more pedigreed seed and with pedigreed seed purchases they will pay royalties which will flow back to the breeding institutions whether they be private or public,” he says.

We’re a competitive environment and dollars are the key, says Hadley. “Generally we reward the winners by buying the profitable varieties that sell in big volumes. So, if you can get some big winners in the cereal market, where the breeders made good money by selling them and getting a good return on an investment, they will continue to invest,” he says. “We’ve demonstrated this in soybeans; we’ve demonstrated it in corn and canola. The development companies that are able to bring forward valuable products win the sales, they make a return and they’re able to invest more in breeding in their core crops.”

Differentiation Sells

And in order to be a “winning company” as competition increases, Hansen says it’s all about finding ways to stand out in the crowd. Last year, Canterra Seeds ran a cutting edge marketing campaign for its new series of canola that did just that.

“We challenged our agency based on our own business and our programs and what’s out in the marketplace today, to try and differentiate Canterra Seeds, try to get out of the clutter and do things a little bit differently,” says Hansen. “It may be a little risky but, at the same time, an on-the-edge marketing plan is not such a bad thing.”

In order to keep up with the seed industry today, companies need to anticipate and welcome change. Be adaptable. And that applies to all areas of the seed sector.

“We need to be on the edge, on the front edge of the changes and adopting them and putting them in a practice and showing the customers that they work for them first,” says Brian McNaughton of Hytech Production, which focused on parent seed production and parent line maintenance to large scale hybrid seed production.

Challenges and changes aside, it still comes down to the seed and its value will continue to increase in the coming years.

“It all begins with seed. The seed industry today is quite different from what it was 15-20 years ago, as new traits have been introduced,” sums up House. “But when selling seed, it all comes down to integrity of the seed and making sure that you’re delivering strong value to the grower, and that can come about through the seed as well as through the enhancements that come along with the seed.” Julie McNabb

where_on_webTo view Germination's Giant Views of the Industry video series, visit Germination.ca.

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