Protein effort will require more breeding investment

The president of Protein Industries Canada says investments in plant breeding will be an important part of the organization’s overall plan to expand Canada’s stake in the growing global market for plant protein.

In a recent presentation to members of the Prairie Grain Development Committee in Saskatoon, PIC president Bill Greuel said its “value-chain approach” to building the Canadian protein industry will include investments in plant breeding and varietal development.

PIC is one of five Canadian organizations that will each receive approximately $150 million as part of the federal Innovation Superclusters Initiative.

PIC’s $150 million funding package will be used to leverage another $150 million through private sector investments, boosting the overall investment in the Canadian plant protein industry to $300 million.

Greuel said PIC is in an enviable position to strengthen Canada’s position as a leading global supplier of top quality protein products.

“There’s an opportunity for us in Canada to service a growing market and to build on our competitive advantage of a 60 million metric tonne crop that produces probably on average 12 million metric tonnes of protein,” Greuel said.

“We’ve got a global reputation and we’ve got an opportunity to service market need that’s going to be hard for other (countries) to take from us, if we do this right.”

PIC is currently recruiting staff members who will help to administer the organization and allocate funds.

The first projects that are approved to receive PIC funding are expected to be announced in the next three to four months.

Greuel said PIC investments will be divided generally among four categories within the protein value chain.

Those categories will focus on projects that support and enhance plant breeding, primary crop production, processing and processing technologies, and market development and branding.

Greuel said Ottawa’s decision to stimulate private sector investments through the federal superclusters program is an important step forward in Canada.

In recent years, Canada has been reducing its investments in research and development when measured as a total percentage of national gross domestic product.

“In Canada … we’re not investing in science and innovation to the same degree as other OECD (Organization for Economic Co-operation and Development) nations in aggregate,” Greuel said.

“It doesn’t matter if you’re the public sector, federal or provincial, academia or the private sector, we’re lagging behind all other OECD nations in terms of the investments we’re making in science and innovation.”

Even in the agriculture sector, which is considered a technology driven industry, public investments in science and innovation, while increasing in real dollar terms, have been losing ground to inflation since the 1980s, he said.

Greuel cited several factors that have contributed to reduced science and innovation spending in the Canadian agriculture sector, including complacency caused by proximity to U.S. markets, the effects of Canadian currency on trade and corporate consolidation in the private sector.

He also cited the Canadian regulatory environment as a disincentive to investment that needs to be addressed.

“I’ve talked to many private sector companies that are … reluctant to invest in science and innovation and the commercialization of technologies in Canada because of the state of the regulatory environment here,” he said.

“I’m not standing up here saying we have to de-regulate the industry…. One of the reasons we’re successful in Western Canada … is because of our strong regulatory environment. But we really do need to think about how we streamline regulations and make it work for both the protection of food safety and environmental safety, but also make it work for private sector investors as well.”

Greuel said government investments made through the federal superclusters program —a total of $950 million in five supercluster projects across the country — represent a welcome influx of capital.

PIC will also be working to secure a larger portion of venture capital that’s available in Canada.

“The reality is that only about three percent of the venture capital investments in Canada come into Western Canada, and only a fraction of that is going into agriculture,” he said.

“There’s a need for venture capital to grow this industry.

“We’re working with a number of venture capital firms at Protein Industries Canada … so that they (investors) can have a very clear, clean line of sight into the types of technologies that we’ll be developing.”

Greuel said statistics suggest that Asia’s middle class will grow by 940 million people over the next 12 years.

That represents a significant opportunity for Canada’s agriculture and agri-food sectors, which are ideally positioned to provide overseas markets with healthy foods that contain more protein.

Western Canada will never be the lowest cost provider of agricultural commodities on a global basis, he said.

That distinction will belong to countries like Russia and Ukraine — where production costs are relatively low — or Australia, which enjoys a comparative advantage in transportation.

“But I think we can be a supplier of choice to those who can afford to be more discerning consumers.”

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