The Fabric Of Seed Ties

Since retailers last placed their seed orders, the fabric of the seed market has been altered by seed company purchases and partnerships. While it may look like typical industry consolidation, don’t mistake it for attrition. Instead, these new ties are woven with the anticipation of providing an expanded array of seed offerings and options and better market value.

For example, Pioneer Hi-Bred Inter­national, Inc., a subsidiary of DuPont, is now partnering with Syngenta Seeds, Inc. as part of GreenLeaf Gen­etics LLC (see “It’s A Deal”). The joint venture marks the first time Pioneer will offer targeted access to its plant genetics library — the world’s largest — to other seed companies.

Traits Provide Pay-Off

The overall quality of existing traits is helping retailers manage the dollar shift from crop protection to seed, says Ron Milby, seed division manager for GROWMARK, a CropLife® 100 retailer headquartered in Bloomington, IL.

“Traits are the one winning the day,” Milby says. “There’s a lot of risk mitigation with some of the traits that we have out there. For example, there are some areas of Illinois that have had dry conditions for two years and the crops look pretty good. Growers are looking for something that can provide proven performance from one year to the next in different environments. They’re putting a lot of inputs out there and expect a return. Traits — including the triple-stack traits — are one of the best ways to ensure they’re going to get a pay-off.”

Retailers also will need to narrow the number of brands they sell — and really know what those brands are capable of — especially with the speed that new traits and germplasm are coming into the market.

Dealer Vs. Donor

While retailers can plan to have an expanded variety of seed choices to offer their grower-customers, those that sell a proprietary seed brand also are in direct competition with the basic seed companies, notes Brian Hefty, manager of Hefty Seed Co., a CropLife 100 retailer located in Baltic, SD.

“They’re selling us the genetics and traits, so they have a cost advantage over us,” he says. “And if one of their reps decides to get some business by making a bunch of deals, we can’t even get down to the price level they can.”

Nonetheless, his dealership continues to offer seed value to its grower-customers. “We have to have the best possible offering out there to the farmer, including great agronomists and great prices,” Hefty says. “It’s never easy. If it were, everybody would try to do it, but you just have to learn and adapt to it.

As long as you do, you’ll be fine.”

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