The clock is ticking on private plant breeding investment in Canada

The future of how breeding is funded in Canada is under review and headed for change. The “value creation” consultations created much engagement and debate last winter, where producers were asked to weigh in on an end-point or trailing royalties on new varieties. While some people have attempted to halt the process, others have tried to craft an elusive third model, and others have debated which of the two suggested models should be chosen.

Canada is really at a crossroads on which direction it will take for the future of plant breeding in Canada. There is no solution that will make everyone happy or satisfied, but the danger of doing nothing is the least ideal option that has more dramatic impacts than some stakeholders are willing to admit.

The timing isn’t great for farmers. This large-scale change is coming at a time where poor harvests feel common, markets are bearish and farm profitability is a concern. All of these realities make it difficult for farmers to think about the future when the present is so financially strained.

The public breeding sector is changing its role, as well. Historically, Ag Canada was a dominant force in supplying the Canadian market with wheat, barley, and oat varieties, but that is not the role they wish to play in the future. The tax payer wants to be out of the plant breeding business.

Private breeders have immense interest in the Canadian market, but are reserved in diving in with firmly planted financial feet until Canada adopts a “value creation” model. The main reason for this is that certified seed use in all crops besides corn, soybeans, and canola are far too low to provide the returns for future investment. Farmers want better agronomic traits, output traits, disease and insect resistance, along with higher and more consistent yields and that’s going to come through a fee on certified and farm-saved seed in the future.

Although it may be a tough pill to swallow, if Canada does not move ahead with a chosen model the private investment will leave Canada faster than Ag Canada has currently backed away from plant breeding.

The recent decision by Syngenta to wind down Canadian cereal plant breeding is just one sign that 20 million acres of wheat is not as attractive as it sounds without an opportunity for return on investment. One private breeder in Canada told me in confidence that under the current royalty structure even the most successful wheat breeder would not be able to sustain a proper breeding program.

Another plant breeder described this move to value creation as a long-term strategic one. “This is Canada’s opportunity to put the U.S. at a major disadvantage when it comes to crops like wheat,” they said.

I get why some farmers feel royalties are a tax, set up so seed companies can make money (never mind all the conspiracy theories that cross my desk), but the government’s message has been consistent from both sides of the political aisle that Canada needs to change its approach.

In talking to a handful of private breeders that have invested in Canada, all state emphatically that the clock is ticking for Canada to make a decision or money will be allocated elsewhere. How much time is on that that countdown clock no one really knows, and all breeders will have different exit dates but the threat should not be taken lightly.

No decision has yet been made on what model we’ll move forward with. If pressured, the current minority Liberal government could switch course and delay the decision but indecision may be interpreted as no decision. Having an underfunded public breeding sector and no ability to attract large private investment is not going to meet the plant breeding needs of Canadian farmers.

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