Generating Funds for Plant Breeding and Variety Development Value - PowerPoint PPT Presentation

Generating Funds for Plant Breeding and Variety Development Value Capture in Canada For the ISF Field Crops Section For the ISF Field Crops Section May 28, 2014 Patty Townsend, CEO, Canadian Seed Trade Association Growing for the World/ Une Croissance Axée sur le Monde

IP and Value Capture in Canada 1. Setting the stage – the situation in Canada 2. IP tools 2. IP tools 3. Investment in plant breeding and variety development p 4. Changes in Canadian IP Environment 5 5. Developing a Value Capture System Developing a Value Capture System Growing for the World/ Une Croissance Axée sur le Monde

IP Tools Used in Canada Event/Trait Cell Tech.Use Contracts Hybrids PVP/PBR Patents Patents Agreements Canola X X X X X Corn X X X X X Soybeans y X X X X X Cereals X X Pulse X Crops p • • Private sector investment is going where there are Private sector investment is going where there are more options to protect intellectual property Growing for the World/ Une Croissance Axée sur le Monde

Total investment in research plant breeding Total investment in research, plant breeding and variety development* in Canada in 2012 was $165.9 million $ Public Sector $46.5 million Producers $19.9 Private Industry $99.5 Private Industry $99.5 million illi million * canola, cereals, corn, pulse crops, soybeans Growing for the World/ Une Croissance Axée sur le Monde

Private Sector Investment in Canada Soybeans 9% Pulse Crops Cereals 8% 0.5% Canola Corn Corn 15% Pulse Crops Cereals soybeans • 83% of Private sector investment is in Canola, Corn and Soybeans Growing for the World/ Une Croissance Axée sur le Monde

Investment in Cereals 2012 AAFC $23.5 million (58%) Private Industry Private Industry $ 8 4 million (21%) $ 8.4 million (21%) Farmers $ 8.3 million (21%) Total $40.2 million • 7.6% of total private sector investment was in cereal breeding and variety development

Wheat Yield – Top 5 Exporters 1962-2012 7 6 5 5 4 Argentina Australia 3 3 Canada C d EU 2 USA 1 1 0 962 964 966 968 970 972 974 976 978 980 982 984 986 988 990 994 996 998 2000 2002 2004 2006 2008 2010 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 2 2 2 2 2 2 USDA Foreign Agriculture Service Growing for the World/ Une Croissance Axée sur le Monde

Wheat Yield – Top 5 Exporters 1962-2011 7 6 5 5 4 Argentina Australia 3 3 Canada C d EU 2 USA 1 1 0 962 964 966 968 970 972 974 976 978 980 982 984 986 988 990 994 996 998 2000 2002 2004 2006 2008 2010 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 2 2 2 2 2 2 USDA Foreign Agriculture Service Growing for the World/ Une Croissance Axée sur le Monde

Seeded Acres Wheat vs. Canola 16 14 12 ‘000 Ha 10 8 8 6 Canola 4 4 2 0 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Statistics Canada Growing for the World/ Une Croissance Axée sur le Monde

AAFC Vision of Cereal Variety Development Public/Producer Public/Producer Producer/Private Producer/Private AAFC and Universities Producer/Private Germplasm + Germplasm + Partnership P t hi Consortia Investment Trait development Public good trait Variety Variety de elopment development development Testing and g evaluation Accelerated variety y Variety release – minor y release classes?

The Variety Developer’s Return on Investment Hyland’s FT Wonder (soft red winter wheat) H l d’ FT W d ( f d i h ) • Variety Development Cost - 9 years - $926,814 Year 1 Year 2 Year 3 Margin g $1.92/25kg g $1.84/25kg g $1.90/25kg g Sales 176,000 units 10,546 units 32,000 units Revenue $337,920 $19,405 $60,800 Variety Development Cost $ 926,814 Three Year Total Revenue Three Year Total Revenue $ 418 125 $ 418,125 Three Year Net ($508,689) Growing for the World/ Une Croissance Axée sur le Monde

• Plant Breeders’ Rights are currently the main IP tool for cereals in Canada • Current legislation conforms to UPOV 1978 December 9 2013 December 9, 2013 • Bill C-18, Agricultural Growth Act introduced in the House of Commons th H f C • Proposes to bring PBR legislation into legislation into conformity with UPOV 1991 Growing for the World/ Une Croissance Axée sur le Monde

Bill C-18 completely complies with UPOV 1991 • Includes a “farmers’ privilege” – to save grain produced on their own farms to use as seed on their own farms • Gives the Minister the ability to make regulations: make regulations: • To include or exclude crop kinds from PBR • Respecting harvested material and farm saved seed Growing for the World/ Une Croissance Axée sur le Monde

Partners in Innovation • • 18 organizations joined 18 organizations joined together to support Bill C-18 - 17 farmer organizations representing vast majority ti t j it of farmers and over 90% of production - CSTA facilitates and is a member • Actively promoting PBR Actively promoting PBR amendments Growing for the World/ Une Croissance Axée sur le Monde

Next Steps 1 1. Legislation must pass through the House of L i l i h h h H f Commons and the Senate • Fall 2015 Federal election • Fall 2015 Federal election 2. Develop PBR Regulations • Technology Value System Growing for the World/ Une Croissance Axée sur le Monde

Funding Innovation - A Technology Value System Technology Value System CSTA facilitated – Value Chain Developed p • Large international conference April, 2013 • Value chain working group g g • Draft concept presented to larger group • Value chain finalized A “Canadian Technology Value System” that will effectively capture funds from the value chain for y p investment in plant breeding and variety development in order to bring benefits to all stakeholders along the value chain value chain. Growing for the World/ Une Croissance Axée sur le Monde

Funding Innovation - A Technology Value System The Concept The Concept • Established in regulation associated with new PBR Act • Apply to all cereals protected with PBR under new Act • Indicators of success – to determine the value of the system – results published every 5 years t lt bli h d 5 • 2 components 1 1. Flat rate delivered grain royalty $Cdn 1 50/Tonne Flat rate delivered grain royalty $Cdn 1.50/Tonne 2. Refund for producers who purchase certified seed • Monitoring and testing to help prevent misdeclaration • Cooperation of the entire value chain Growing for the World/ Une Croissance Axée sur le Monde

Funding Innovation - A Technology Value System Next Steps • Present the concept to the Minister p • While focussing on Bill C-18, develop proposed regulations in the background • Public consultations • Implementation of the system – with retroactivity Implementation of the system with retroactivity Growing for the World/ Une Croissance Axée sur le Monde

Canadian Seed Trade Association Suite 505, 2039 Robertson Road Ottawa, Ontario Canada K2H 8R2 +1 613-829-9527 +1 613 829 9527 www.cdnseed.org Growing for the World/ Une Croissance Axée sur le Monde