Popular wheat varieties removed from royalty pilot

Seed distribution company SeCan has withdrawn two of its most promising new wheat varieties from a controversial seed variety use agreement (SVUA) pilot project.

SeCan officials say CWRS wheat varieties AAC Wheatland and AAC Starbuck will not be included in the SVUA pilot project, which would require commercial grain farmers to pay royalties each time harvested seed is saved and used to plant new crops in subsequent years.

SeCan decided to withdraw Wheatland and Starbuck from the pilot project following discussions with the Canadian Wheat Research Coalition (CWRC), which comprises provincial wheat commissions in Manitoba, Saskatchewan and Alberta.

The CWRC, on behalf of provincial wheat commissions, invests farmer check-off dollars in wheat breeding and wheat research programs. The provincial wheat commissions are opposed to having public seed varieties included in the SVUA pilot.

AAC Wheatland and AAC Starbuck are both publicly funded varieties that were developed by wheat breeders at Agriculture Canada. Both are high-yielding, semi-dwarf, midge tolerant Canadian western red spring wheat varieties that are expected to become popular over the next few years.

“Both Starbuck and Wheatland are very strong products that offered an ideal fit in the (SVUA pilot project), so there would have been good grower uptake and they would have been a great fit for the pilot,” said SeCan business manager Todd Hyra.

“But as we neared the launch… the relationship with the commissions was strained. We’ve had a long-standing, good working relationship with them and it (the decision to include Wheatland and Starbuck in the pilot) was straining that relationship and our ability to move forward in a productive fashion.”

Hyra said SeCan and the CWRC have signed a memorandum of understanding in which SeCan will withdraw the two wheat varieties from the SVUA pilot project.

The MOU also includes a co-funding agreement that will offset some of the revenue that would have been generated through royalties on farm-saved seed.

Additional details of the MOU were not shared with The Western Producer.

“What we ended up doing was developing an MOU with the commissions — through the Canadian Wheat Research Coalition — to fund some of the needs that would have been funded through the (SVUA) revenue…,” Hyra said.

The removal of Wheatland and Starbuck from the SVUA pilot is the latest chapter in an ongoing seed-industry effort to generate more revenue from new crop varieties developed in Canada.

A consultation process on “value creation” in the Canadian seed sector ended in disarray last year with producers voicing strong opposition to the collection of any additional seed royalties and seed industry stakeholders insisting that additional revenues are needed to ensure that Canadian wheat breeding programs are properly funded.

When Ottawa signaled last year that it had no intention of continuing the federal “value creation” consultation, stakeholders in the Canadian seed trade pressed forward with a value creation solution of their own.

The SVUA pilot project was launched earlier this year by the Canadian Seed Trade Association (CSTA) and the Canadian Plant Technology Agency (CPTA).

It was presented as a potential blueprint for a new “value creation” model in which farm-saved seed — seed that’s saved by a grower and used for propagation — would be subject to royalties through a seed value use agreement (SVUA).

Royalties on farm-saved seed would be collected by seed developers or plant breeding institutions and, in theory, re-invested in plant breeding programs to ensure that Canadian farmers continue to have access to new and more productive plant varieties with leading genetics.

In February, after the SVUA pilot project was announced, provincial wheat and barley commissions in Manitoba, Saskatchewan and Alberta issued a strongly worded news release expressing “significant concerns about the Seed Variety Use Agreement (SVUA) pilot project and its future impact on western Canadian wheat and barley producers.”

“The five wheat and barley commissions (in Manitoba, Saskatchewan and Alberta) are not a party to, nor supportive of this pilot SVUA program,” the joint news release stated.

“The pilot is separate from the federal government’s consultation process on a new seed royalty structure and signals the seed industry’s commitment to the SVUA model despite the on-going consultation.”

The SVUA pilot project is still proceeding but the inclusion of so-called public varieties such as AAC Wheatland and AAC Starbuck remains a point of contention.

The pilot project, which is expected to be in place this year, will apply to at least three new PBR protected seed varieties, including two wheat varieties and one soybean variety.

The wheat varieties include two Limagrain products — a CWRS variety named CS Daybreak and a Canadian prairie spring variety called CS Accelerate, which will be distributed through the Canterra network.

A glyphosate tolerant soybean variety developed by North Dakota State University will also be included in the pilot. That variety will be distributed in Canada by SeCan.

Officials from the CSTA and CPTA have indicated that additional varieties may be added to the SVUA pilot in the future.

Tom Steve, general manager of the Alberta Wheat Commission, said the MOU between the CWRC and SeCan was the result of some “good dialogue” between the two parties.

Steve said the commissions believe that publicly developed wheat varieties that have received front-end funding from producers should be viewed through a different lens than privately developed varieties.

“We’ve stated publicly that we have concerns about treating publicly developed varieties the same (as private varieties) in an SVUA because farmers have already invested a significant amount of money on the front-end,” through core breeding agreements, Steve said.

“In the end, we were able to come up with an MOU with SeCan that ensures there will be a continuous flow of funding to new variety development and they (SeCan) have agreed to set aside those two varieties in the pilot while we have a more fulsome discussion on what the future of royalties would look like on public varieties …(from) Ag Canada or the universities for that matter.”

Hyra described the withdrawal of AAC Wheatland and AAC Starbuck as a significant set-back to the SVUA pilot.

“It’s certainly a set-back because these are big mainstream varieties that (have) significant commercial interest for producers,” he said.

SeCan is still committed to the pilot project and will be adding additional products in the future, he added.

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