Much to consider after merger rejection

Seeds Canada is likely but the seed growers’ association won’t be joining

Canada’s seed sector has some contemplating and healing to do in the wake of seed grower association members rejecting a merger with four other seed groups, which would have formed a new, single entity called Seeds Canada.

Since the other four voted strongly to merge, it’s expected Seeds Canada will go ahead, but without the 3,300-member Canadian Seed Growers Association (CSGA) — the largest of the five organizations. Other groups in the proposed merger include the Canadian Seed Trade Association (CSTA), the Canadian Seed Institute (CSI), the Commercial Seed Analysts Association of Canada (CSAAC) and the Canadian Plant Technology Agency (CPTA).

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Why it matters: How new varieties are developed and how seed is multiplied and distributed affects the profitability of not just seed growers, but the farmers who buy and grow the seed.

There’s lots to consider, including how the CSGA, which under the Seeds Act in co-operation with the Canadian Food Inspection Agency (CFIA), might interface with Seeds Canada.

Proponents of the merger argued it would create a unified seed industry voice, especially as the federal government is expected to soon modernize the act and regulations.

Meanwhile, there’s a fear among some seed growers on both sides that, with the association divided, its statutory role in certifying pedigreed crops might be at risk.

CSGA members voted 414 (55 per cent) against and 337 (45 per cent) in favour of merging in a vote that concluded Aug. 27. The merger plan needed two-thirds of voters to pass.

The CSGA’s board was to meet Sept. 4 to discuss its future after the rejection.

While only about 23 per cent of the eligible seed grower members cast a ballot, the voter turnout was reportedly better than expected.

Conflicting visions

Those who supported merging, including Oak River, Man., seed grower Eric McLean, who sat on the CSGA merger oversight committee, argued merging would provide seed growers with a single-service window, streamline seed certification and provide seed growers with more market opportunities on top of a unified seed industry voice.

But many ‘No,’ voters, including a former CSGA president and Stettler, Alta., seed grower Norman Lyster, feared merging would see seed companies subsume growers and force farmers to pay a lot more for seed.

Norman Lyster.
photo: Allan Dawson

“This is a segment of the industry that wants control — full control — of the regulations and the voice,” Lyster said in an interview Sept. 1. “The taxation capability — value capture — is what they’re dealing with, and it’s to solidify an extreme market power position.”

McLean agrees that “No” voters were motivated by fears of seed companies wresting control of Seeds Canada and pushing trailing royalties (seed use agreements) on farm-saved seed. However, he doesn’t believe the former would happen. As for seed use agreements, he said, their value will be determined by a pilot project underway now. But with public funding declining for variety development, new money is needed, he added. If seed growers were part of Seeds Canada, they would have more influence over the seed royalties, McLean said.

“Now producers are back in the darkness again and we are in our own room shouting at each other again with nobody listening,” he said.

McLean also said funding variety development and the merger are separate issues.

Lyster, however, said they are directly connected.

Both men said the CSGA is fractured and in need of healing, and both rejected the other’s vision.

Eric McLean.
photo: Allan Dawson

“If the face of the CSGA changes to reflect this negative sentiment (of the ‘No’ side) then I do believe all is lost because these people were not dealing in a progressive, futuristic vision,” McLean said.

As for Lyster, he said the CSGA’s leadership doesn’t realize how out of sync it is with members.

“What I think they really seriously need to do is start looking at themselves and say, ‘How did we go this wrong?’” he said.

McLean said he was “horribly upset” with the outcome after the sector spent five years and more than $1 million developing a merger plan.

While Lyster was pleased with the vote result, he views it more as winning a battle rather than the war.

“All it did was give us a breathing spot to try and get some people thinking,” he said.

Although there is a provision to hold another vote among seed growers, that’s unlikely, according to McLean. Another vote might have been called had a majority of members voted for the merger, but fell just short of the 67 per cent threshold, he said.

“I don’t see any reason why we should have an extra vote,” he said.

In addition to blocking the merger, Lyster argued the vote had another positive outcome, as more farmers who aren’t seed growers are aware of what’s at stake.

“We need to see the crop commissions and a broader, more diverse ag sector engagement,” he said.

“There needs to be a broader discussion on what’s really going on and really what the purpose of all this is. If it’s for the commercial grower to be… the saviour to the seed industry, there’s a problem. That’s not what it’s built to do. The seed industry is supposed to help the commercial farmer be profitable.

“If you want a vibrant seed industry, you need a vibrant ag industry.”

About the author

Reporter

Allan Dawson

Allan Dawson is a reporter with the Manitoba Co-operator based near Miami, Man. Covering agriculture since 1980, Dawson has spent most of his career with the Co-operator except for several years with Farmers’ Independent Weekly and before that a Morden-Winkler area radio station.

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