Government, private industry make contrasting bets on crops

Two recent announcements by the federal government and private industry show very different research approaches to a couple of crops

Two recent announcements by the federal government and private industry show very different research approaches to a couple of crops grown in Alberta. Both have announced the investment of millions of dollars into barley research by the federal government on the one hand, and corn research by Monsanto on the other. From the outside, it looks like the barley growing industry is trying to catch up with the increasing advancement of corn production in western Canada, and the corn growing industry is striving to expand their production even further. For growers, it all boils down to which crop will produce the most profit.

From a number of aspects, it’s barley production that seems under the gun.

Both crops have some unique qualities and uses that are not interchangeable, however the one area that they do compete directly in is in livestock feeding — both for grain and silage. That area has become the main weak point for barley as corn plant genetics continue to relentlessly make significant advancements in grain yield and overall per acre plant silage tonnage. For cattle feeders in particular those advancements present stark economic realities. Cheap feed is the basis of their business. They know that grain and silage corn is what allows their American competitors to grow cheaper beef — the allure is real and does not bode well for barley production.

It gets worse for barley as growers vote with their wallets. There is a decline in barley production because growers can make more money with canola, wheat and speciality crops. On top of that, barley market stability tends to be tenuous being large feedlot operators will switch to importing train loads of corn in a heartbeat and a nickel if the price is right. Present corn future prices are dropping into the $4 range with projections of the largest corn crop ever this fall. If that happens, barley prices will take a big hit, with malsters being the only reprieve. Besides, most feedlot operators like feeding corn.

To slow down the decline in production, the industry and government figure that more research into barley is the answer. Lower input costs, higher yields and better more specific use varieties are to be developed. Well, more power to that approach and the announcement of $8 million towards researching that goal is to be commended. But that may well be a futile exercise in the long run, especially for barley used for feeding purposes. Monsanto announced that it is going to invest $100 million into improving corn-plant genetics to make it more feasible to replace barley in more areas of western Canada. For a private company to make that kind of investment shows not just significant risk taking, but probably a clear understanding as to their research abilities to create varieties that will flourish in new corn-challenged areas. I expect they have GM corn varieties in the pipeline that will need less heat units to grow and lower soil temperatures to germinate. To be fair, any new varieties that will flourish in western Canada will also expand corn production in the northern U.S., the Ukraine and other corn frontier areas. The point is that there is a message here, private industry is not investing in better barley because there is no money to be made — not for seed companies and not for many growers. The big elephant in the room is genetic engineering of cereal crops and it’s clear that barley research will not be going in that direction. That puts any potential genetic or economic progress for barley at an instant disadvantage and it will only get worse. Barley is already miles behind corn for use in the livestock feeding industry. Barley has to make a giant leap forward to overcome that huge gap.

Meanwhile, the big plant genetics companies are roaring ahead with ever more GM corn research that will in all likelihood displace even more barley. I would suggest that 10 years from now, we will see GM corn grown for livestock feeding beginning to dominate that sector, with barley being relegated to being grown for malting purposes, speciality niche markets or a crop of last resort.