Ag Research at a Cross Roads

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Public research was key to developing agriculture in Canada. The discovery of summerfallow, Marquis wheat, canola and zero tillage all occurred within the research programs at Agriculture Canada research stations. However, there is a growing concern that public agricultural research expenditures in Canada have declined over the past decade despite numerous studies showing high rates of return to research. At the same time that this decline has occurred, a slowdown in yield growth has also taken place.
Accelerated demand growth for agricultural products, combined with developments in biotechnology and a general interest in innovation, could renew interest in agriculture research. For example, rapid income growth in China and India is set to see these nations with populations of 1.3 billion and 1.08 billion, respectively, increase their demand for protein. In developed nations, increasing consumer income has led to a demand for greater variety and food safety. Growing concerns over the environment and GHG emissions could create a demand for renewable bioproducts, renewable fuels and carbon sequestration. Lastly, the recent emergence of the international biofuels industry is an important source of accelerated demand growth for agriculture. This relatively new demand is equivalent to over a decade of regular expansion in global grain production.

The increased potential for agricultural research is also taking place at a time of growing international recognition of innovation as a source of economic growth. As part of their efforts to increase innovation many countries have changed how research dollars are allocated and how the public research sector interacts with the private sector.

Given this background, what can be inferred about the future of agricultural R&D in Canada? To answer this question, it is necessary to understand why R&D expenditures fell in the past and what the implications are of this fall. For instance, did research expenditures decline because the government chose to divert a greater proportion of its agricultural budget to income safety nets in response to short-term demand by farm groups? Or was the decline due to a perception among policy makers that low incomes in the grain economy meant that there were low returns to research? Have these lower expenditures been the cause of slower yield growth, or was this slowdown due to other factors (e.g., technological barriers, freedom to operate issues)?

If R&D expenditures have fallen because of a perceived gloomy future for agriculture, will high-income growth, increased biofuel production, and growing environmental concerns stimulate the demand for the creation and adoption of new technologies? Does it seem probable that we will see a renewed and revitalized interest in agricultural and life science research to capture the growing demands and to generate wealth? Or will the short-term tenure of politicians cause them to direct money to short-term income programs rather than long-term investments? Will a lack of access to technology and a lack of freedom to operate continue to slow the rate of innovation, or can the institutions that govern agricultural research be modified as part of the national innovation strategy?

Adapted from Richard Gray's CAES Presidential Address.

Further reading:

Gray, Richard and Stavroula Malla. "The Rate of Return to Agricultural Research in Canada", CAIRN Policy Brief, Number 11.

This blog entry was authored by Richard Gray, a professor in the Department of Bioresources Policy, Business and Economics at the U of S and the 2007-2008 President for the Canadian Agricultural Economics Society. This entry was adapted from Richard's CAES Presidential Address. To read additional Illative Blog entries or to leave comments on this entry, please visit www.illativeblog.ca. The Illative Blog is an initiative by the Knowledge Impact in Society (KIS) Project based out of the University of Saskatchewan. Email correspondence can be sent to kis.project@usask.ca

4 Comments

Alvin U said:

You raise a good question. Some one needs to do a study on what motivates funding decision makers within government to alter funding priorities. Is it always politicans who set the agenda? Is it the background of new staff that are hired (many no longer have a farm background or any connection to farming)? Is it the kind of courses and presentations that staff attend? Is it too many MBA types that are business people "wannabees" that assume someone else will do the fundamental research, the agronomic research etc. and that their department should only fund very applied "value added" research? Are they personnally "tired" of people in the research branch? Do they want something trendy to tell their friends at the bar that they are funding (e.g., genomics = trendy; agronomics = boring)?

In short - who has been deciding funding priorities and why have they been deciding the way they have?

DMcKell said:

During the late 90's and early 2000's the focus for Ag research changed from production oriented programs to a more targeted MII (matching investment initiatives) approach. I think this was primarily due to budget cutbacks and the re-allocation of Ag funds to farm income support and business risk managment programs. Also at the time there seemed to be a move to a more centralized decision making process based in the Sir John Carling building. This combination has had a huge affect on program development.
What is necessary to re-vitalize the research branch is:
a) a significant increase in funding. Compared to the rest of the world, we have excellent scientists but they can only do so much with what they have;
b) program planning and reviews must involve key producers and producer groups. These innovators have lead the science for key practices such as no-till (as has been the case in other key grain producing countries such as Brazil, Argentina and Australia;
c) Place a heavy focus on economics associated with research. The end users are keenly tuned to the short and long term cost/benefits as a result of the past 20 years of crappy returns.
that's my humble opinion

Richard Gray said:

There is good evidence that DMcKell is on the right track in terms of solutions. If agriculture is going to be an innovation driven sector to exploit the opportunities "century of biology" then we have to invest more in research. According to the OECD Japan invests 7% of it GDP into R&D and has built an innovation based economy. Current rates of investment of just over 2% of Canadian Agricultural sales into agricultural research, which about average for all industries in the OECD, is not enough to make us a leader in innovation.

Our historical experience in Canola, pulse crops and zero tillage,as well as the recent Australian experience, shows that producer input can create very a effective R&D program, so going forward this is part of good governance. Benefit/ Cost analysis of research is an important tool for managing research and for maintaining public and industry investments. Perhaps, this will help to maintain the focus on the need for long term investments.

PFarnese said:

From my perspective, public research in agriculture may also be compromised by the high turnover of government employees. It is has often been my experience that the person who conceived or championed a publicly funded research project is rarely around when the project is complete. In this environment, it must be very difficult to maintain any support for a research agenda that does not have immediate application. In an ideal research environment, I envision a balance of long-term research projects with unknown implications as well as short-term research projects with more defined objectives. I wonder if the current operation of the public service has lost this balance and I lament the innovation lost as a consequence.

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This page contains a single entry by Richard Gray published on November 29, 2007 10:12 AM.

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