Seeds

Seeds are the foundation of agriculture and the strategic industry to secure grain security

Seeds are the foundation of agriculture. If we controlled seeds, we have basically controlled agriculture. The emergence of the world seed industry started with the birth of hybrid corn. It already has a history of nearly a century. Since the end of the 20th century, driven by the rapid development of market globalization and biotechnology, the world agrochemical groups entered seed industry one after another and conducted merging and acquisition of specialized seed companies. A worldwide upsurge of restructuring and merging was therefore launched in seed industry. The average annual growth of traditional seed industry was 4% during 2004-2014, whereas the average annual growth of GM seed industry was 46% in the same period. The sales revenue of the world seed industry was $21.0 billion in 2005 and reached $40.0 billion in 2014. The growth in the planting area of GM crops slowed in the past 3 years. The annual growth of GM seed industry is down to 7%. The annual growth of traditional seed industry has however basically maintained the average level of past 10 years (5%).

Seed industry is a basic and strategic high-tech sector related to the national economy and people’s livelihood. Advanced countries or regions such as the  United States, European countries and Japan pay great attention and give firm support to the development of seed industry. Large seed companies are all from these countries or regions, mostly American and European enterprises. In terms of R&D input, the proportion held by private institutions is rising. In terms of R&D achievements, private enterprises also outperform the public sector. Take GM seeds for instance. Of the over 17,000 GM crop field test applications approved in the United States during 1985-2014, more than 7,000 applications came from Monsanto and more than 1,400 applications came from Pioneer, accounting for 40% and 8% of the total respectively. Applications coming from public and non-profit organizations only accounted for around 25%.

Most of seed enterprises in China have started to pay attention to technical input, but their R&D input only accounts for around 1% of their sales revenue, much lower than the proportion of over 10% in large multinational seed companies. The inadequate R&D input has led to a low rate of high-quality seeds in domestic enterprises. China relies heavily on foreign enterprises for high-quality seeds. At first foreign enterprises used vegetable and flower seeds as breakthrough points to occupy the Chinese market. As their market shares increased over the years, China’s field crop seed market is also increasingly impacted by foreign enterprises.  

As the world commercial seed market developed rapidly, China’s commercial seed companies have also entered the market. Through regrouping, restructuring and rebuilding of 2,700 companies at provincial, municipal and county levels, a group of large companies integrating breeding, reproduction and promotion have been established. Driven by both policies and market in recent years, the number of seed enterprises was reduced from over 8,000 in 2010 to 5,000 in 2015. The concentration degree of the industry has been raised. Seed industry will be further readjusted in the future. Merging and restructuring among enterprises will be more frequent, the number of enterprises will further decrease and the average size will continue to increase. The concentration degree will be higher. The state policies will help promote the emergence of large seed enterprises with the ability to integrate breeding, reproduction and promotion.