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Lessons from a rejected seed deal

Seed growers found enough to avoid accepting a deal tying them to other seed groups, despite a five-year process

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Glacier FarmMedia – Canada’s seed industry is taking a step back to ponder farmers’ stunning rejection of a cross-industry organization merger.

“We’re disappointed,” said Lorne Hadley, executive director of the Canadian Plant Technology Agency and a key proponent of the five-organization merger idea.

“This was a very, very long process.”

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Why it matters: Farmer concern about various parts of the proposal show that there’s not enough trust yet throughout the system to build organizations that bridge an entire supply chain.

Members of the Canadian Seed Growers Association were the last of the five groups involved to vote on the proposal, which all four other organizations had approved.

Farmers not only failed to give the merger idea the required two-thirds support needed to pass it, but didn’t even give it a simple majority, with 337 in favour and 414 against.

It derails the attempt to unite the seed growers with the CPTA, the Canadian Seed Institute, the Canadian Seed Trade Association and the Commercial Seed Analysts Association of Canada. The new organization, which would have been called Seeds Canada, would have created a body that represented almost every element of seed crop production in Canada.

While many of the non-farmer elements of the industry were shocked by the rejection, Lyndon Olson, an Archerwill, Sask., producer, wasn’t surprised.

“I’m surprised (the number of votes to reject were) that big. I’m not surprised it failed,” said Olson, a seed grower who would have been on Seeds Canada’s inaugural board.

“It’s quite a gap.”

But Olson said many farmers he spoke with were bothered by a number of issues with the merger deal.

Many disliked not knowing how much their membership fees would increase if the deal was approved.

“It’d be like buying land without negotiating the price,” said Olson, summing up the view of some farmers he heard from.

With relations between seed growers and other parts of the industry having been testy at times in recent years, some farmers weren’t willing to operate on trust.

“That hasn’t existed in several years,” said Olson.

Others were bothered by the selection process for representatives, which might not have been as open and transparent as a vote-only system.

There would have been 15 board members, including one from seven regions of the country, along with at-large members representing the different original organizations. That’s a dramatic change from the farmer-driven Canadian Seed Growers Association that farmers are used to.

However, this rejection doesn’t mean farmers have necessarily shut the door on uniting with the rest of the seed industry, Olson said. For many farmers, this merger was just too much, too fast.

“It’s not that they’re saying no to a deal. It’s just saying no to that package,” said Olson.

“I think (the rest of the industry) need another stab at that package to accommodate what growers need to feel confident in a new organization.”

The current merger proposal won’t go forward without the CSGA. What the four other organizations do post-rejection won’t be known until their boards have a chance to analyze and reflect.

“Moving forward is what good, member-driven organizations do,” said Hadley.

“We go back to our boards with the results.”

The Canadian Seed Trade Association issued a statement saying, “without a unanimous decision the boards of each organization will reconvene to determine the next steps. An update on this matter is anticipated by the middle of September.”

The CSGA issued a statement saying it was disappointed with the decision, but “we were prepared for it.”

The seed grower board will now consider whether to abandon the amalgamation efforts or “re-engage with our amalgamation partners with a view to reaching a new Seeds Canada agreement with broader member appeal.”

Some believe the other four organizations will attempt to unite without the seed growers’ participation.

The failure to unite the entire industry frustrates an effort aimed at avoiding some of the communication issues and distrust that have at times made various parts of the seed business feel as if they are competitors or in conflict, as opposed to being co-operative members of a single value chain. Hadley said there is still a clear need to improve industry communication and co-ordination, and to give it a unified voice when dealing with governments and regulators.

“The goal should be the same for all of us: getting more value out of improving seed and getting it into the hands of the commercial grower,” said Hadley.

“That hasn’t changed because of the vote.”

Olson said the non-farmer members of the industry might be surprised and upset by the rejection, but they need to understand farmers are often wary of too quickly making agreements that affect the industries on which they rely.

Farmers have often said no when an idea is presented to them, to later say yes after they are satisfied a deal makes sense for them. The rest of the industry needs to accept that farmers might need some convincing.

“They’re not used to doing deals this way,” said Olson about non-farmer interests.

“They don’t always happen at first.”

This article was originally published at The Western Producer.

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