Is it time for a new seed paradigm for scaling seeds in Africa? Presentation by Richard Jones of STTP/AGRA

1. Is it time for a new seed paradigm
for scaling seeds in Africa?
A presentation given at the Regional
Dialogue on Strengthening African Seed
Systems: Technical, Economic and Policy
Challenges
July 15, 2014

2. Seed in the context of
Global Food Security
• Seed is placed highest in order of importance among
agricultural inputs
– Quality seed gives the single highest return on investment of
crop inputs that any farmer may purchase
– Acceptance of new seed technologies is dependent on reliable
supply
• No other input can give such a return on investment or
on long term food security
– Providing farmers the best choice of seed for their particular
environment and needs is paramount
– Bad seed cannot be ‘made better’ by adding other inputs
– Purchasing power and cash-flow challenges of farmers should
be solved in other ways (i.e. not by giving sub-standard seed)
Seed gives the highest ‘bang for the buck’ of any agricultural investment

3. Foundations
Consultants Academics
FAO National Programs
Donors
Previous Seed “Projects” in Africa
Seed
Industry
Seed
Companies
CGIAR
Seed
Initiative
Inputs
Initiative
NARS
NGO’s
Contractors
CBO
Commodity
Initiatives
Regulatory
Initiatives Farmers
Seed Industry and Farmers were ‘awkward guests’ in the Development Agenda
Private
Sector

4. Understanding seed demand
• Acute seed insecurity
– Civil and/or natural
disasters
• Chronic seed insecurity
– Usually as a result of
poverty
• Demand for quality
seed
– Hybrids
• Demand for new
varieties

5. Existing seed systems
• Informal (farmer) seed
system
– Seed production integral to
crop production
– Farmer seed selection
– Regulation through “good
neighborliness”
– Range of seed acquisition
methods
– New varieties through
social networks, local
selection, and formal seed
system
– Very resilient
• Formal (commercial) seed
system
– Seed multiplication
separate from crop
production
– Quality control regulated
externally (seed legislation)
– Seed acquired for cash
– New varieties through
research and development
– Dependent on a regular
demand

6. Who are the seed customers?
• Deficit producers
– Risk averse
– Few fungible assets
• Vulnerable to disasters
– Food and nutritionally insecure
– Depend on grain markets
• To meet production shortfalls
• For seed
• Commercially oriented
farmers
– Risk takers
– Greater level of assets
• Less vulnerable to disasters
– Market surplus production
– More likely to purchase seed

7. Organizational arrangements
• Formal (commercial) seed system
– Vertically integrated
• Large multinationals
• Private capital
– Vertically coordinated
• Smaller seed companies
• Mix of investment sometimes including public

8. Vertically integrated versus vertically
coordinated
• Vertically integrated
– Strategic research
• Public and private sector
investment
– Applied research
• Mainly private sector
investment
– Market research
• Private sector
– Marketing
• Private sector
• Vertically coordinated
– Strategic research
• Mainly public sector
investment
– Applied research
• Mainly public sector
investment
– Market research
• Public and private sectors

9. Formal seed systems
• Successful systems are commercially viable
• Public investments in crop improvement need to be
accessible
– Stimulate seed entrepreneurship
– Reduce the cost of seed
• Supportive regulatory framework
– Stimulate seed trade
• Effective regulation required
– Quality control etc
– Plant variety protection
• Development should support and not replace private
initiative

10. Constraints to seed sector development
• Technological
• Institutional
• Policy
• Output markets
• Relief seed

11. Technological constraints
• Availability of improved germplasm
– Open-pollinated varieties
– Hybrids
• Biological protection of Intellectual Property (IP)
• Provides incentives for commercial investment
– Research
– Seed production and marketing
– Transgenics

12. Institutional constraints
• Lack of technical capacity
– Seed production, processing and marketing
• Poorly developed regulatory systems
– Seed quality control
– Seed testing services
• Over regulation increasing transactions costs

13. Policy constraints
• Small national seed markets
• Different agro-ecologies within countries
• Similar agro-ecologies between countries
• Different regulations between countries
– Variety release
– Phytosanitary standards
– Very limited Plant Variety Protection laws
• Results in limited seed trade

14. Output market constraints
• Limited development of output markets
• High price volatility
• Disincentive to farmer investment
• Farmer organizations provide one option
– Forward contract
– ‘Warrantage’ system to reduce volatility
• Introduction of grades and standards
– Incentive to use improved seed
• More uniform and higher quality of produce

15. High market transaction costs
• Results in expensive seed
in rural markets
– Focus on few crops with
effective demand
• High overheads of larger
seed companies
– To maintain breeding
programs
• Smaller overheads of
smaller companies
– Depend on publicly
developed germplasm

16. Economies of scale in crop breeding
• Limited commercial investment in breeding
• Public investments limited & inconsistent
• CGIAR major source of germplasm
• Increased adoption with seed investment

17. Existing approaches
• Supply driven
– Free seed delivery
• “Seeds and Tools” programs
• Starter packs/targeted inputs program
• Subsidized market-oriented approaches
– Community seed banks
– Seed for grain exchange
• Market-orientated approaches
– Seed fairs
– Small seed packs
– Commercial seed sales
• Uncoordinated effort between stakeholders

18. The way forward
• Improve flow of information to seed stakeholders
• Improve access to public varieties
• Support and strengthen development of private
sector capacity
• Promote the development of regionalized seed
markets
• Sustain investment in plant breeding
• Support commercial investment

19. Improved flow of information to seed
stakeholders
• Develop seed catalogs
– Provide information on adaptation
– Provide information on seed availability
• Publicly developed varieties
• Commercial varieties
• Publicize new varieties
– Community radio
– Extension, NGOs, input suppliers, and farmers
– On-farm demonstrations

20. Expanded on-farm demonstrations
• Exposes farmers to new varieties
• Need to ensure that seed is available to
respond to created demand
• Involve input dealers and entrepreneurs

21. Improving access to public varieties
• Establish foundation seed units
• Sale of small packs
• Capacity building in seed production
– Hybrids

22. Foundation seed availability
• Need for foundation seed of publicly developed
varieties
• Effective seed storage to maintain seed stocks
• Cost recovery through sales
• Market foundation seed
– Organized groups of farmers
– Seed entrepreneurs
– Seed companies
• Provide training in seed production and
marketing

23. Seed storage and processing
• High capital cost of equipment
• Make effective use of underutilized public
facilities
• Provide services on contract
– Seed entrepreneurs
– Seed companies
– Farmer associations

24. Promote the development of regionalized
seed markets
• Harmonization of procedures
– Variety release
– Seed certification
– Streamline quarantine pests and diseases
– Establish plant variety protection laws
– Implement an accreditation system
– Streamline export/import regulations
– Strengthen seed trade associations

25. Regional variety release (SADC)

26. Need for collaboration
• National governments
• Regional economic
communities
• Research institutions
– International
– National
• Private sector
– Seed companies
– Farmer associations
– Seed trade associations

27. Attract commercial investment
• Remove barriers to
entry
• Let farmers decide
– Retain DUS
– Remove VCU
• Subjective assessment
• Allow and support
introduction of hybrids
• Introduce Plant Variety
Protection laws

28. Conclusions
• Successful formal seed systems are the domain of
commercial companies not governments
• Public investment needed in crop improvement
• Balance between public and private investment
needs to be dynamic
• Private investment needed in seed production and
marketing
• Effective regulatory framework and support services
needed
• Ensure relief interventions don’t undermine
development

29. Constraints
• Uncoordinated effort
• Many released varieties never multiplied
• High market transaction costs
– High overheads of larger seed companies
• Markets distorted by relief seed
• National seed markets too small
• Private investments in breeding limited
• Public investments inconsistent & inefficient
• Limited output market development

30. Background
• Improved varieties developed by researchers have not been accessible to
farmers due to lack of commercially viable or effective product
deployment systems
• Lack of consistent quality and supply impedes uptake of new varieties.
• Seed Industry best suited to ensure a long term supply of quality seed to
farmers
• Slow in industry due to numerous challenges
– Non-competitive levels of credit access and funding for companies, poor seed
systems infrastructure
– Regulatory capacity, environment, complexity or an inconsistent
administration
– Government and Donor ‘free seed programs’ or grain distribution
– technical and economic constraints
– Under developed business and technical skills
– Germplasm and market access

31. Conclusions