Contents
The yield of agricultural crops and the quality of final products are highly dependent on the achievements of breeding. Experts from the Higher School of Economics and the Federal Antimonopoly Service found out why our country mainly sows imported seeds and how to fix it
What seeds are planted in our country
In 2018, scientists from the Omsk State Agrarian University bred the Owl wheat variety with purple grains. It contains many antioxidants and is rich in anthocyanins, which give the grains an unusual color and help fight inflammation. The new variety is resistant to drought and pests and does not require chemical treatment.
Researchers have been working on breeding the Owl for about ten years. After three years of testing, it will be entered into the state register, breeders expect.
In total, the register of varieties approved for use on the territory of our country contains about 25 thousand items. But only a small part is used on an industrial scale. At the same time, wheat is the only one of the key agricultural crops, the production of which is based on the developments of Russian breeders.
For other cultures, the situation is quite different. In 2009-19, the share of seeds of foreign selection in the Russian agro-industrial complex has sharply increased, the authors of the research project “Selection 2.0” found out. It was prepared by experts from the HSE-Skolkovo Institute for Law and Development, the HSE-Skolkovo International Center for Competition Law and Policy, and the HSE Technology Transfer Center with the support of the Federal Antimonopoly Service. The main conclusions of the report were presented at a round table in Rossiyskaya Gazeta.
According to researchers, the share of foreign breeding for corn over the past ten years has increased from 37 to 58%, for sunflower – from 53% to 73%. The highest indicator is for sugar beet: 98% of the area is sown with foreign varieties.
“If nothing is changed, wheat is highly likely to repeat the development trajectory of other crops,” the authors of the report predict. According to them, so far global companies have invested little in biotech wheat breeding: this crop has a complex genome, which scientists deciphered only in 2018.
But now breeding programs for wheat will be updated. This may jeopardize, among other things, the position of the Russian Federation as an exporter of grain, market participants warn.
Eduard Zernin, Chairman of the Board of the Union of Grain Exporters:
“Our country holds leadership in the world wheat market in a highly competitive environment. And although some countries – yesterday’s leaders – have focused their production on more marginal crops (primarily soybeans and corn), we feel serious pressure from Australia, especially in the markets of Southeast Asia, as well as Argentina. Both countries have a favorable location, which in the context of global climate change is beginning to play a critical role.
Moreover, in 2020, Argentina was the first in the world to approve the commercial production of drought-resistant GM wheat. This could lead to a revolutionary redistribution of the market if Argentina can significantly increase production volumes and reduce costs. The world’s largest consumers are more concerned about the price than the quality of the purchased grain.
By the way, China, the largest producer of wheat in the world, has recently taken a decision in the direction of the industrial application of biotechnology in plant breeding. In the long term, commercial adaptation of GM crops appears to be a major threat to our leading position in the global wheat market.”
Why are seeds worse?
The average age of Russian varieties on the market is 10-20 years, the authors of the report calculated. This is twice as much as the varieties of foreign selection, which are used in our country. As a result, domestic seeds often lose in terms of their characteristics.
Over the past couple of decades, the world has almost completed the transition from an extensive to an intensive farming model. Now the plant is considered as a technological bioreactor that processes all the resources introduced into the soil into agricultural products. And breeders every year create new varieties that perform this task more and more efficiently.
Seeds have a strong effect on the yield, including due to the “responsiveness” of the variety to fertilizers, pesticides and other agricultural technologies. Today, the yield of Russian wheat is more than half that of Canada, China and European countries, primarily in terms of growth rates, a study by the Higher School of Economics and the Federal Antimonopoly Service has shown. According to the results of a survey of farmers about spring wheat, the leader of the rating was “Triso” of the German company DSV – one of the few foreign varieties admitted to the Russian market.
In the Russian breeding science, things are not in the best way, the authors of the report admit. The activity and citation of scientific organizations from our country in the field of modern plant biotechnologies is less than 1% of the same indicator in the United States or China. Less and less dissertations on the topic are being defended, there are not enough personnel in specialized organizations, and modern educational programs in universities.
Nevertheless, the achievements of domestic breeding should not be underestimated, says Academician of the Russian Academy of Sciences, Director of the Federal Scientific Center for Forage Production and Agroecology named after V.R. Williams Vladimir Kosolapov. In our country there are scientific schools of legendary scientists, he recalls. And it is with seeds bred by Russian research institutes that 87% of the area of winter wheat and 92% of the area of oats are sown, and 100% of the area of rice and buckwheat.
How breeders were left without money
The main problem is that breeders in our country have little connection with the market, according to researchers from the Higher School of Economics and the Federal Antimonopoly Service. And the money-back scheme for breeding and seed production, according to them, “does not function at all.”
When it comes to hybrid seeds, the issue is resolved naturally. The yield and quality of such seeds are lost during resowing. That is, agricultural producers cannot get them on their own. Therefore, breeders control the prices of seeds of their varieties, and they correspond to the contribution to the cost of the final product. For example, in the production of rapeseed and corn, seeds account for 25-30% of operating costs.
It is more difficult with non-hybrid varieties. Such seeds can be reproduced almost uncontrollably. Breeders have no leverage to influence this – both farmers and seed companies can get products without their participation. As a result, the share of non-hybrid seeds in operating costs is much lower. For example, for wheat, it is only 10-15%, and only a small part comes to selection.
Global industry trends further complicate the situation. After a series of mergers and acquisitions, global players began to actively offer package solutions for agricultural producers. Seeds are sold along with agrochemistry and connection to digital platforms. As a result, any third-party developments are incompatible with the products of companies that dominate the market.
On top of that, the amount of royalties that breeders receive is noticeably lower than in other countries. According to expert estimates, they amount to 0,016% against 2% in foreign markets.
The main source of funds for breeding remains direct state subsidies for specialized state institutions, most of which are poorly adapted to the market.
“We hear a lot of criticism of research institutes, but business is in no hurry to interact with science. Here, too, there are problems, the work cannot be built efficiently, ”explains the situation, the director of the Samara Research Institute of Agriculture. N. M. Tulaykova Sergey Shevchenko. In his opinion, “new economic forms” should develop, but at the same time it is important to take care of the breeding work of institutions, which has been built for many decades.
Vugar Bagirov, Director of the Department for Coordinating the Activities of Organizations in the Sphere of Agricultural Sciences of the Ministry of Science and Higher Education of the Russian Federation:
“The food security doctrine states that by 2030 we must provide 75% of the needs of Russian producers with seeds.
Closer ties between science and the real sector of the economy, with business is the only opportunity for the development of selection today. We don’t have any other alternatives.
We are ready for aggressive offensive work to bring breeding achievements to the world market. The national project “Science” provides for the creation of five agro-biotechnoparks that will disseminate breeding achievements and advanced biotechnologies in the regions. For these purposes, 35 breeding seed-growing centers are being created, and their financing is provided in the amount of 3,5 billion rubles. And, of course, the legal framework of the industry needs to be updated.”
Where to get funds
The volume of investment in the industry today is about 10 times lower than the value that can potentially be created at this stage, the authors of Selection 2.0 found out.
“We are in a situation where for a qualitative leap forward in the field of breeding, Russian market participants do not have enough public money that institutions receive in the form of subsidies, subsidies, government assignments, and so on,” says Mikhail Kharchenko, director of the HSE Technology Transfer Center. He emphasizes that the amount of such funding is not comparable to the investment of multinational companies in R&D.
According to the expert, the Russian selection has two possible sources of funding – commercial and investment. But private investment money will not come into selection until the monetization scheme is clear. This means that it is necessary to work out business models for breeding and commercial earnings in this area.
“The only source of commercial money can be the commodity market,” continues Kharchenko. — For varietal and hybrid crops, there are different approaches, but the point is to redistribute the income of commodity producers in favor of breeders and seed growers. As we can see from the example of wheat, even 1% of the market for marketable products will give 7-8 billion rubles. to the Russian breeder in the form of royalties and license payments, and for sunflower – 2-3 billion rubles.
To solve the problems of selection, it is not necessary to multiply government structures, Dmitry Balkov, consultant to the general director for seed production of the Prodimex group, agrees. “We can work in the system that we have. But the main thing is for specialists in applied breeding science to understand that their main goal is to make money, and not just breed new varieties “for show,” the expert is sure.
How to develop the industry
The authors of Selection 2.0 are confident that the state of affairs in the industry threatens to turn our country into a “world garden” — a center of low-margin, economically unstable and environmentally harmful production, which is deeply dependent on government subsidies. And to avoid this, breeding and seed production needs a structural transformation.
An example of a new approach to the development of the industry, focused on increasing the competitiveness of the Russian agricultural sector, was the FAS order to our country on the Bayer-Monsanto merger. The regulator agreed to the merger, but imposed a number of conditions on Bayer. The agricultural giant was obliged to transfer genetic material and technologies to Russian farmers free of charge for the development of their own varieties and hybrids and to conduct trainings for recipients. With support from Bayer, a plant biotechnology training and research center was also established to teach advanced breeding techniques.
Compliance with the order is supervised by the Technology Transfer Center specially created for this purpose on the basis of HSE. One of the special projects of the Center, implemented jointly with partners, was Selection 2.0.
The authors of the project proposed ten main steps that should provide breeders with investments, and agriculture with domestic seeds. First of all, we are talking about the transfer of the industry to market rails.
Helping the development of strong private sector companies is the most obvious way to overcome dependence on foreign varieties and hybrids, Igor Artemiev, assistant to the prime minister of our country and former head of the Federal Antimonopoly Service, believes. “Only such players have a chance to compete with foreign suppliers, who are increasingly offering not just genetic material (seeds), but ready-made package solutions,” Artemyev notes.
State support should be channeled into creating “vertically integrated national leaders,” the report says. Such companies will not only be engaged in breeding and seed production, but will be able to sell their own packaged solutions – just like global players do.
In addition, the authors of the study propose the creation of several interdisciplinary educational centers for the training of breeders, biotechnologists and bioinformatics. And also reorient scientific institutions to the needs of business, form their own database of genetic collections, develop new programs and adopt a unified breeding strategy for the period up to 2030.
In addition, it will be necessary to update the regulatory field in a number of areas – from the protection of intellectual property rights to the tracking of seed material in the market.
Alexey Ivanov, Director of the HSE-Skolkovo Institute for Law and Development, Director of the BRICS Antimonopoly Center:
“One of the fundamental problems that we identified during the study is the lack of a normally functioning market chain in the breeding and seed industry of our country.
We see that state research institutes, which, for example, hold patents for key wheat varieties, receive a total of about 120 million rubles a year. royalties, despite the fact that we grow marketable wheat for 800 billion rubles.
This abnormally low amount of royalties redistributed from producers to breeders is explained, among other things, by the low involvement of state institutions in the market, which is generally normal for post-Soviet scientific organizations.
But applied breeding is not a science for a long time. This is a technological business that must operate in a competitive market logic, dynamically capture the demand from farmers. GosNII is not the best form for such work.”
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