Your Reading List

Editor’s Take: Seed royalties just one option

The key issue in the seed royalty debate appears to be that farmers are very reluctant to any system that costs them more money.

Ron DePauw wouldn’t get a second look from most Canadians.

But his worth to the country is measured in the billions, yes, with a “B.”

Born in rural Saskatchewan and raised on a Treherne-area farm, the now-retired DePauw is one of the most prolific wheat breeders in the world.

He was involved in the research that led to the registration of a total of 65 wheat and six triticale cultivars. Among his hits include AC Barrie, AC Lillian and the latest blockbuster, AAC Brandon.

Wheat is responsible for between $4 billion and $5 billion in direct farm receipts every year and another $7 billion to $8 billion in value-added processing. For many years varieties developed by DePauw and his research team have made up between 40 and 55 per cent of all the wheat grown in Canada.

Put in that perspective, his impact on individual farms, the wider industry and the country as a whole is staggering. And he has been recognized for those efforts, with awards that include the Order of Canada. But as a public servant with Agriculture and Agri-Food Canada, his recognition wasn’t necessarily financial.

The combination of DePauw’s knowledge, intelligence and diligence, mixed with a bit of public money and support, continues to yield an annual return Canadian farmers can count on every season.

What’s much less clear is whether a similar success story could be written today. As our Allan Dawson reported in our Oct. 24 issue, there’s already less public funding and facilities available to do this sort of work. Gone is Winnipeg’s Cereal Research Centre, at the University of Manitoba, for example. It seems run-of-the-mill work like crop variety development is of less interest to the federal government.

Those numbers are borne out by another Dawson story, our cover story in today’s issue, reporting the results of a grower survey by the three Prairie provinces’ general farm organizations.

In it he quotes SeCan’s Todd Hyra who noted that the AAFC Swift Current program, where DePauw worked, has seen its capacity decline over time. In 2001, he noted, there were 10,000 lines at the F4 to F8 breeding level. By 2014, Hyra notes, that had declined to around 5,000, or a 50 per cent reduction in capacity.

Those stark numbers are why many in the industry say a new funding model is required, and it has sparked a “Seed Synergy” review by the federal government that’s examining two systems, trailing and end point royalties.

As the federal government quietly backs away from plant breeding and variety development, they say something must be done to backfill. Otherwise Canadian farmers will find few new varieties and will eventually be at a competitive disadvantage to farmers elsewhere.

The problem is that there’s no consensus on what that new way of doing business should look like — unless you count the fact that farmers don’t seem particularly chuffed about either option that’s currently on the table.

The proposals that have been put forward so far are two variations on a theme that would see farmers paying royalties on cereal crops seed for the first time.

They differ a bit in the detail. One royalty would be collected at the “end point” when a delivery is made. The trailing royalty option would essentially be a contract under which farmers agree to pay the variety developer if they save and plant seed.

One thing they do seem to share is the disdain of the farmers who will be expected to pay those royalties. Of the farmers who felt they had enough information to make an informed decision, close to 80 per cent said they either “disagreed” or “strongly disagreed” with both proposals.

Perhaps that’s a sign that it might be time to expand the menu of options on the table in the interest of giving the industry a meaningful choice.

The key issue appears to be that farmers are very reluctant to agree to any system that costs them more money, but surrenders control to profit-driven enterprises.

One possible solution might be to divert those royalties to the Western Grains Research Foundation.

The WGRF is a farmer-funded and -directed non-profit organization that was formed in 1981 by a dozen farm organizations. Its mandate is to invest in agriculture research that benefits farmers. Over the years it’s invested a total of $183 million to support crop research projects. It allocates about $15 million annually.

It’s done a lot of good with those funds, but it’s a pittance compared to a similar organization in Australia.

There the Grains Research and Development Corporation spent the equivalent of $172 million Canadian dollars in the 2017-18 crop year alone.

Maybe it’s time to seriously consider whether Canada should be funding the WGRF to similar levels in lieu of a complex royalty scheme.

About the author


Gord Gilmour

Gord Gilmour is Editor of the Manitoba Co-operator.



Stories from our other publications