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Australian grain producers pump dollars into research, target Canada, says the WGRF
Saskatoon, Saskatchewan
July 12, 2004

Australian grain producers have their game face on when it comes to research funding, and they're openly gunning for Canada, says a Canadian grain quality expert who recently spent a year Down Under.

Through the Grains Research Development Corporation (GRDC) levy, Australian grain growers pour more dollars into research than any other grain group in the world - over $120 million annually - and they're happy to do it, says Dr. Michael Edney of the Canadian Grain Commission. Australian producers view their research levy not as a tax, but as a high-return investment that can catapult their country ahead of Canada and other key competitors in the global grains trade.

"Australians in general are very competitive - it comes through in their sports, but it's not just their sports, it's everything," says Edney. "You see this competitiveness in the attitude and approach of the Australian grain growers when it comes to research funding.

"As a malting barley quality specialist, most of what I observed was on the malting barley side, and there was lots of talk about beating Canadians. We kicked them off the top years ago beginning with Harrington, and they talk a lot about getting back to the top where they feel they belong."

Edney offers more observations on Australia's approach to farmer research funding in the July edition of Western Grains Research Magazine, available on the Western Grains Research Foundation (WGRF) Web site at www.westerngrains.com. Western Canadian wheat and barley growers are major investors in wheat and barley breeding research through the Wheat and Barley Check-off Funds, administered by WGRF. The Research Magazine offers "Ideas and issues for farmer research investors."

Australian grain farmers approach research funding in the same way their countrymen approach the nation's top sport - Australian Rules football - full throttle, aggressive, unrelenting and part of a strong team focus.

Despite the GRDC's large budget and competitive approach, in the case of wheat and barley research, Canada has proven itself just as good, if not better at the final product - which is putting out improved varieties, he says. "It's hard to pinpoint why that is, but a few reasons are likely our breeding programs are more mature, we have very good collaboration among our breeders and we've had some good people in place for a long time."

That said, the weight of funding and research power on Australia's side may make it only a matter of time before the country gains a distinct advantage in variety superiority, he says. "Eventually, if things continue the way they are, the Australians are going to have a great opportunity to leapfrog past us."

The July edition of Western Grains Research Magazine also includes a feature article that updates Canada's effort toward higher strength durum wheat. A new Canadian durum variety has set a new standard for what qualifies in Canada as the new "extra strong" class of durum. The variety shows strength that places it on equal footing in the international marketplace with the high gluten strength "desert durums" from the United States and Australian.

"Extra strong durum is a niche crop in many respects," says Graham Worden of the Canadian Wheat Board. "But now with improved varieties coming along, we could see demand for Canadian extra strong durum increase from about 180,000 tonnes per year to about 325,000 tonnes over the next few years."

Western Grains Research Foundation is funded and directed by Western crop producers, and allocates approximately $4 to $5 million annually to research through the Wheat and Barley Check-off Funds and a separate $9 million Endowment Fund.


Source: Western Grains Research Magazine, June 2004

'Aussie Rules' research

Australian producers have their game face on when it comes to research funding, and they're openly gunning for Canada. Dr. Michael Edney of the Canadian Grain Commission spent a year Down Under and offers some observations on the Australian system and what Canada's up against.

Australian Rules football is a game of full throttle competitiveness. For a team to win, every player must be aggressive, unrelenting and part of one collective focus - kicking the ball through the uprights.

Australian grain farmers approach research funding in the same way their countrymen approach the nation's top sport, says Dr. Michael Edney of the Canadian Grain Commission (CGC). Through the Grains Research Development Corporation (GRDC) levy, Australian grain growers pour more dollars into research than any other grain producers in the world - over $120 million annually - and they're happy to do it. Australian producers view their research levy not as a tax, but as a high-return investment that can catapult their country ahead of Canada and other key competitors in the multi-billion dollar global grain trade.

"Australians in general are very competitive - it comes through in their sports, but it's not just their sports, it's everything," says Edney, who recently spent a year doing research in Australia and observing the GRDC system. "You see this competitiveness in the attitude and approach of the Australian grain growers when it comes to research funding.

"As a malting barley quality specialist, most of what I observed was on the malting barley side, and there was lots of talk about beating Canadians. We kicked them off the top years ago beginning with Harrington, and they talk a lot about getting back to the top where they feel they belong, by beating the Canadians at malting barley."

In his capacity as a barley quality expert, Edney serves as a member of Western Grains Research Foundation's (WGRF) Barley Check-off Advisory Committee, a body of farmers and grain industry experts that advises the WGRF Board on administering the Barley Check-off Fund and directing research funding. Western Grains Research Magazine talked to Edney about Australia's competitive focus in farmer research funding, as part of a discussion on perceptions gained from his Australian experience. Here's a roundup of other key points from the conversation.

Farmers supply nearly all funding

Edney's work in Australia was headquartered at the University of Adelaide, one of the country's largest centres for agricultural research. A program manager of applied barley research at CGC, Edney collaborated with Australian researchers on projects examining fermentability in malting barley.

"In the plant breeding section where I spent most of my time, the GRDC funded the salary and work of nearly all the 35 to 40 staff. There's very little of what in Canada we would call 'A-base' or government funding. The GRDC is in the drivers seat with research funding, and the researchers are very dependent on that support."

Focus on the bottom line

All research funding is directed with a clear focus on the bottom line, says Edney. "The primary thing they look at is what's the financial return. In one report, for example, the GRDC said it wanted at least a 10 percent return for a particular type of research. If that return was considered unlikely, it would look at a different investment option."

The GRDC funds a range of research, not just plant breeding, and places a high priority on following research progress through to a commercial end point, he says "They don't let things go, they carry them through. They want to see all research pursued until there's a commercial return at the end of the day." The policy and review panels of the GRDC are heavily influenced by farmer representatives, who put added emphasis on return to farmers.

Business approach to funding

Australian growers' business approach to funding is evident throughout the system, says Edney. In recent years, the GRDC has moved beyond funding research only, to funding its own commercial enterprises further along the value chain in order to ensure commercialization of their investments. A prime example is Australian Grain Technologies Pty. Ltd., an independent company established with GRDC as a partner and with a mandate of wheat breeding and commercialization of new varieties.

"With the wheat company, they brought many of the wheat breeders and other researchers together, streamlined things and eliminated quite a few of the research positions that had been funded by GRDC. They see this as savings - getting more bang for their buck - and operating with greater focus and efficiency. They're looking at the possibilities of doing the same thing in barley."

Business approach to science

The Australians are largely "gung ho" in their business approach to research funding, but the research community there has shown some concern, says Edney. The unpredictable and exploratory nature of a lot of science makes it difficult to meet the standards of a strict business approach.

"The researchers sometimes see it as a bit of a problem that could stifle innovation. If you take a hard line and say you want a guaranteed return, your not going to support some of the more far-reaching or less commercially focused research that could be very important."

Still, with the sheer dollars Australian growers are pouring into research, this hasn't appeared to be much of a problem, he says. "Though it may not be among the top priorities, they still do some pretty interesting research that is more exploratory, because they still have enough dollars left over to do it."

Growers united in support

The GRDC-co-ordinated levy is compulsory - producers voted to have it and participate annually in determining the levy level, with farmers big and small united in their support.

The compulsory nature gives Australian producers a significant advantage in research funding, says Edney. "As I said, the producers in Australia view research as an investment that's important to their competitiveness. But not only that, they also view themselves collectively as a team that pursues that investment opportunity."

With Canada's WGRF check-off, producers have the option to opt out. While the opt-out percentage has been small - typically less than 10 percent of eligible producers - the funding not captured can be significant, especially if those producers represent large acres.

"As a WGRF Advisory Committee member, I find it sad to think any of our larger producers would opt out, because those are the producers you would expect are most likely to see the investment value and ultimately get the most return on that investment.

"In Australia, the large producers have a very strong pro-research attitude. They support the system wholeheartedly and are very active participants in the organization. That has a big impact on their success."

Bigger is not necessarily better

There's no arguing Australian grain producers are funding far more research than Canadian growers, and the Australian research system, as a whole, is much larger. But despite this, Canada has held its own in wheat and barley breeding progress, says Edney.

"GRDC has a huge budget, but surprisingly, when it comes to breeding progress, I find we're just as good if not better at the final product, which is putting out improved varieties. It's hard to pinpoint why that is, but a few reasons are likely that our breeding programs are more mature, we have very good collaboration among our breeders and we've had some good people in place for a long time. We should also remember that the Australian breeders have to develop varieties that can successfully grow in poorer soils - for example, due to boron toxicity - and cope with severe weather."

Aiming to leapfrog Canada

That said, the weight of funding and research power on Australia's side may make it only a matter of time before the country gains a distinct advantage in variety superiority, he says. "Eventually, if things continue the way they are, the Australians are going to have a great opportunity to leapfrog over top of us. For example, they're doing a lot of basic research that will eventually benefit their variety development programs, and that's where we're really losing out. We're just not competing with that type of basic research anymore - we're still relying on advances we made in the past, while Australia has kept out front."

If Australia strikes paydirt on some of its molecular biology investment - particularly if genetically modified cereals eventually become accepted - Australia's advantage could become overwhelming, he says. "It's unbelievable the amount of molecular biology research going on down there that we're not doing. That's not paying off for them right now, but it could pay off big time down the road."

Snapshot: Australia's farmer-driven system

Excerpted from the Meristem Land and Science Barley Breeding Report (view the full report in PDF format).

Approximately 50,000 Australian grain growers support research through a mandatory levy on barley, wheat, canola and other crops. This system was initiated by growers and is co-ordinated by the Grains Research and Development Corporation (GRDC) - a statutory corporation that operates as a research investment body in partnership with growers and government. All GRDC funding is provided through the levy on grain growers.

The Australian government matches producer investment to a set ceiling. Royalties from research funded by the GRDC have also started to play a significant role. Overall, the GRDC now has an annual budget of over $120 million annually, with the vast majority of those funds directed toward research.

Part of broad approach

The GRDC is but one of 12 Rural Research & Development Corporations (RRDC) in Australia. The RRDC's in total have expenditures of $454 million covering grains, horticulture, dairy, cotton, grapes, wine, beef, pork, sugar, wool, fisheries and forest wood products. About 50 percent of RRDC funds come from industry with the remainder matching funds from the federal government (the GRDC budget is based on approximately 40 percent federal money.)

Innovative research by these RRDC has contributed to impressive increases in value of exported Australian agriculture products. Wine exports in 1990-91 were worth $174 million and have increased to $1.76 billion in 2001-02. Forest and wood product exports (including paper) $1.1 billion in 1996-97 to $1.7 billion in 2001-02. Aquaculture production increased 41 percent, since 1996-97, to a value of $2.5 billion in 2001-02. Fishery export have expanded 70% in five years to $2.1 billion in 2001-02.

(Editor's note: Thanks to Canadian Grain Commission's Bill Scowcroft for providing additional information.)

Source: http://www.westerngrains.com/n_researchMag/rm_0407a.html

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