An evaluation of new crop royalty models


As Canada continues to develop a new seed royalty structure, researchers have been comparing models in other countries to better understand the financial implications to farmers, the effectiveness and ease-of-use of the options, and the eventual impact of changes on plant breeding programs.

Richard Gray, professor and Canadian Grain Policy Chair at the University of Saskatchewan, attended two of the recent consultations at Saskatoon, Sask., and heard farmers’ concerns regarding the change in how farmers pay for variety development. Concerns range from an increase in cost, to a potential of loss of control of variety development programs, a loss of public breeding and more.

Gray, and recent M.Sc. graduates Devin Serfas and Seraina Giovanoli, have been working on answering some of the farmers concerns. One of the things they did was look at how partnerships with government, farmers, and private industry might work. They also looked deeper into the two systems proposed by the federal government: end point and trailing royalty. What they found was, of the two, the end-point royalty system came out much “cleaner” — with a relatively simple collection mechanism, similar to the Australian model. The trailing royalty model requires many transactions listing seeding intentions and more, which Gray says becomes very cumbersome.

Gray also looked at how changes in other countries — the U.S. France, the UK, and Australia — have impacted variety development and what Canada might learn from each country’s experience.

Listen below to the full interview:

Click here for the farmer reaction to first Saskatoon consultation.

Coverage of the consultation held at CropSpere can be seen here

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