Vegetable Seed Industry Scenario
Agricultural production is an essential factor for the existence of human race and seed is a vital input for agriculture. Vegetable seeds are the fastest growing category within the overall seeds market. Vegetables play a key role in providing an inexpensive balanced diet. Globally, vegetable seeds market has grown reliably over the past five years because rising worldwide population, expanding middle class, and shifting eating habits with growing consumption of green vegetables in the diet.
Governments of different countries are focusing on vegetable seed industry by investing in biotechnology and related researches. Seed companies are investing more and more in application of biotechnological tools in crop improvement. Conventional procedures are being replaced by modern breeding techniques like anther culture, markers assisted selection and molecular breeding.
Seed is the first and foremost important service for successful vegetable cultivation. Vegetable seed industry is going enormously annually. Several private seed firms with multinational base are actively involving in vegetable seed production making the public sector much lagging behind. Expanding areas under vegetable cultivation, varied agro-climatic conditions, availability of huge and cheap human resource are creating titanic scope for development of vegetable seed industry. Vegetable seed industry has positive influence on national economy in terms of income and employment generation and earning foreign exchange in international market. There are few constraints like excessive cost of seed production, technical problems and stringent laws set break to the vegetable seed industry
Seed industry is the start point of agriculture, being a fundamental and strategic industry which involves agricultural production capacity, increase farmer’s income, and assurance of food security, national economy and people’s livelihood. Since the founding of the first seed company, the world seed industry has developed for 270 years. Globally speaking, seed industry has grown from the past labor-intensive, management-extensive and capital-decentralized form into a modern industry.
Overview of global seed market:
According to ISF and industry consultant report, the global seed market value increased from the $12 billion in 1975 to the $53.8 billion in 2014, which is 3.5 times growth over the last 40 years. In the 5 years ahead, the global seed market is expected to maintain fast growth.
With the continued development of biological technology, global genetically modified (GM) crop planting continues to grow. Genetically modified crops have high yield, extensive adaptability, less reliance on chemical pesticide and higher nutrition value, commercial genetically modified seed market has grown continuously since 1996. The genetically modified seed market value went up from the $7.8 billion in 2007 up to the $14.8 billion in 2014 with growth rate 90%. The genetically modified seed market share also increased rapidly, from 25% upto33%.
Global statistics suggests that seed market of North America ranked No.1 with market value of $17.6 billion and market share of 32%; Asia Pacific ranked No.2 with market value of $16.5 billion and market share of 31% which is very close to North America, followed by Europe ($9.7 billion and 18%) and Latin America ($4.7 billion and 9%).
If we acknowledge about the top 10 seed companies worldwide, which are Monsanto (U.S), Dupont (U.S), Syngenta (Switzerland), Groupe, Limagrain (France), Land o Lake (U.S), KWS AG (Germany), Bayer Crop Science (Germany), Dow Agro Sciences (U.S), Sakata (Japan), DLF-Trifolium (Denmark) from all above Monsanto (U.S) is top ranked which covers over the 16% global market share and ranked at top with the sale of seed 10.76 billion US$. Total business of these top 10 companies has approximately 38 billion(US$), which is a remarkable share of the global economy as well as describing national scenario of the advanced countries in focusing the new techniques of the seed production and their new trend in marketing as well. Besides these top 10 companies there are other seed companies which have share of 43% with the production of 231.3 billion (US$).
Country Statistics suggests that the top 10 ranked countries are US, China, France, Brazil, Canada, India, Japan, Germany, Argentina and Italy. The total market value of the top 10 amounts to $41.9 billion accounting for 78% of the world total, which shows a high degree of centralization of planting area. The traditional North American market and the emerging Asia Pacific market are developing in parallel.
Multinational’s development strategy:
Since the founding of the first seed company Vilmorin in 1743 (now affiliated to Limagrain), world famous seed companies have been founded one after another over the last 100 years. In the 1990’s of last century, the issue of intellectual property rights continued to extend to crossbreeding sector. Large-scale groups have participated in mergers of seed industry players, leading to lots of union and achievement activities, resulting in formation of several highly-developed multinational seed enterprises, who are mostly located in developed countries where seed industry began earlier with higher economic level like the US, Netherland, Germany, France, Japan, UK, Denmark, Switzerland and Sweden. Later Monsanto, DuPont, Syngenta and Dow Agro Sciences, based upon traditional crossbreeding, have further utilized biological technology to breed GM single trait and multiple trait varieties to consolidate their monopoly position in the industry, having gradually pulled ahead from other seed companies.
The 2014 top 10 global seed companies show that companies who have invested in GM trait field captures larger market share and takes an advance opportunity of seed development in the future, which are represented by Monsanto, DuPont, Syngenta, Dow Agro Sciences and Bayer Crop Science.
Future seed industry development:
Seed demand continues to grow, Genetic resources to be diversified. In the future, the world will experience global warming, decrease of cultivated land, increase of population, shortage of food, increase of biofuel capacity, reduction of farmers retained seed, higher volume of commercialized seed and the diversified demand for crop quality and variety. These situations will result in a higher demand for seed world-wide. Organization for Economic Cooperation and Development (OECD) predicts that the world food demand will be 1.2 billion tons in 2023, which will be 130 million tons higher than 2011-13. While the cultivated land for coarse food grain will not increase.
Compared with cereal crop, fruit and vegetable are indispensable due to their unique nutrition. The difference between tropic zone and temperate zone allows farmers to grow extensively different crops, fruit and vegetable.
By reviewing the development of seed industry, it reminds that the breakthrough in hybridization technology and GM technology has greatly promoted the development of seed industry. Multinationals like Monsanto, Bayer Crop Science and Syngenta have all developed crop varieties that are adaptive, high yielding, resistant to insect pest, resistant to adversity and herbicide, as supported by their strong research capacity and superior genetic resources. The overall share and market potential of emerging market are important driving force for the development of future seed industry.
Seed industry in Pakistan:
The new emerging, seed industry is developing very fast. More than 376 seed Companies have been registered. Due to liberal attitude in granting permission to do seed business and free services of seed quality control by the government, now 376 seed companies including four public sector seed agencies and five multinationals have commenced their business in the country. Present day seed industry is a combination of public and private seed sector. This is called as formal seed system. Farmers in Pakistan also save their own seed and exchange seed with each other or buy seed from the local traders and market under the informal seed system. With the induction of private seed sector, the availability of quality seed has increased up to 18 per cent.
The processing capacity has increased from 12.24 to 35.43 per cent. Total employment generation in seed industry according to the data available so far is 24716. The storage capacity has been increased up to 18.17% against the total estimated seed requirement (1340719 million tonns) for all crops. It is expected that seed industry will become one of the leading employment generating sector for our economy.
There are total 737 seed companies from which 137 are registered in 2014. From which more than 650 are private national based companies, 13 are multinational companies which are serving all over the world with the seed of all type having the potential of high yield. The multinational companies which are in Pakistan are named as Monsanto, Pioneer, ICI, Syngenta and Four Brothers.
The impact of the multinational seed companies is much resilient in Pakistan because Pakistan is an agricultural based country and there is a huge room for the marketing of seed of all kind due to having the multi-climate range all over the country throughout the year. The most leading company in the global market has the same impact in Pakistan market as well by capturing the 26% share of the whole national market and from other companies Syngenta is at 2nd with the share of 9.2%.
Pakistan based companies which are producing the seeds of open pollinated (OP) as well as Hybrid varieties. The seed of these national based companies having low cost and high output as compare to local seed. The seeds of the national based companies fulfill the 60% need of the country because these seeds are in fewer prices as compare to the seed available of the multinational companies. There is the list of some national based companies working in Pakistan in the competition against the multinational.
- Haji sons
- Sky Vegetable and Flowers Seed Company
- More green
- Agrico Pak
- Ali Baba
- Noble seeds
- Shareef sons seeds international (Regd.)
- Hico seeds
And a much more working in competition and combating with the new advances. Still a lot of work is being in progressed in the vegetable seed industry, with the new advancement and increasing the pressure of population there is a lot of contradiction in food and consumption need so this industry is flourishing day by day with new advancements. Being a good market and having the suitable climate we are much lagged the social need to fulfill the farmer community and we import a lot of cotton, maize as well as the vegetable seed of tomato, potato, cucumber, chilies and onion as well. With the advancement of the new growing techniques such as green house, tunnel forming and drip irrigation the farmers go for the hybrid seed at the placement of the local seed. So, with the increase in demand there is need of the increasing the national seed producing with low cost and high vigor as well as maximum output.
Saif ullah, Dr. C.M. Ayyub, Mujahid Ali