By Dana Herron
When I tell farmers an acre of irrigated corn seed costs about 300
percent more than an acre of irrigated wheat seed, their first reaction is
usually disbelief. But that probably would have been my reaction too if
I’d never left dryland wheat farming.
Now, after 32 years selling seed and six years as part-owner of my
own business, I look at the price differential not in terms of cost, but in terms of value. Through this prism an entirely different calculation is revealed.
The majority of wheat production in Washington is under dryland conditions (2 million
acres vs. 250,000 acres). In Connell, where I am based, I have the advantage of a foot
in both camps. Because the easier comparisons are made with corn, however, the following
numbers are based on irrigated production.
The average price of corn seed purchased by Columbia Basin farmers today is about
$265 a bag. Each bag of corn seed has 80,000 kernels in it, and farmers usually plant between 36,000 to 38,000 seeds per acre. So a farmer can plant about 2.1 acres with one bag. That equates to a cost of $125 per acre. Irrigated wheat seed, meanwhile, costs an average of $30 to $35 per acre depending on whether it is fall planted or spring planted.
Corn prices are very good right now. With a cash corn bid of $250 per ton and an average
yield of six tons per acre, a farmer can figure a gross return of $1,250 per acre. Wheat,
meanwhile, can average 140 bushels an acre under irrigation in the basin. At $8.50 a
bushel, the gross return is close to corn’s at $1,190 an acre, but the corn rotation does take
a little more water and fertilizer. My point is that the gross returns are roughly the same.
So what justifies the cost of seed?
Last year, DeKalb Corn had what is called pyramided traits in their top hybrids. The
company’s SmartStax Complete is the culmination of years of research and breeding.
It provides crop protection from eight yield-robbing insects using a total of 17 different
modes of action within the plant as well as resistance to two different chemistries,
Round Up and Liberty Link. This does not include the drought tolerance trait the company
promises to bring to the market within the next year.
Although most farmers have friends and relatives who question the genetic manipulation
of plants for the benefit of man, as a group, farmers are more open to science-based
technology having experienced its benefits firsthand. I think it’s safe to say most Eastern
Washington wheat farmers view scientists’ ability to manipulate individual genes
within a plant’s genome as a more precise extension of traditional plant breeding that
has been going on for more than 100 years.
That’s not to say we’re all one big happy family. A small group of farmers around
Waterville believes the introduction of transgenic wheat is a dangerous game we will
regret playing. I very firmly believe otherwise, and if I’m right, in a few short years my
company and others will be selling genetically engineered varieties of wheat seed for
dryland and irrigated production. And that’s when things get complicated.
One of the more difficult tasks of managing a seed business in a diverse agricultural
region like the Columbia Basin is predicting the adoption rate of new technology. The questions seedsmen ask are the same as any businessman.
How much better is the new variety? What will it replace? What is the net financial impact to the grower? Does it save him money somewhere in his operational structure? Who else is committing financial resources to this project? What is the primary area of adaptation? And how fast can we recover our investment?
Of course, we can never lose sight of our markets. In the movie, “Field of Dreams,” the Kevin Costner character keeps hearing a voice say, “If you build it, they will come.” There is nobody in the wheat industry, or the agricultural community for that matter, who believes all we need to do is grow a crop and customers will buy it. We must continually be aware of our customers’ values and desires.
That’s why, in the heart of the corn growing region of the Columbia Basin, there exists a viable conventional corn production and marketing program for customers willing to pay a premium. The market is well policed, the corn is meticulously tested for the presence of transgenic grain, and there is a small tolerance for “adventious presence” caused by errant pollen.
What enables farmers to produce conventional corn is isolation. Planting far enough away from transgenic corn to avoid the pollen drift gets the job done. As a matter of fact, there are two companies actively producing seed corn from inbred parental stock that requires even
If corn growers can take advantage of this dual marketing opportunity, it should be a cinch for wheat farmers as wheat pollen doesn’t travel near the distance of corn pollen. In the final analysis, however, establishing parallel production systems for wheat will be a function
of the marketplace, just as it has been for corn.
In the Tom Cruise movie, “Jerry McGuire,” the line, “show me the money!” became part of the speech of the day. In the case of the adoption of transgenic wheat, I believe the rallying cry of farmers (as well as nonfarmers) should be, “show me the science!” That’s because when it
comes to the adoption of transgenic wheat, science must be the ultimate authority.
U.S. citizens have been eating GMO-derived foods since 1996 without a single case of a health-related illness, which is a far better record than some organic foods have. That kind of track record shouldn’t be a surprise. Nowadays, it costs around $30 million for companies to register a single transgenic event with the EPA, money spent ensuring that human health and environmental risks are negligible (because there is no such thing as zero risk in anything human beings do).
Meanwhile, the advantages credited to transgenics are obvious. In the last 10 years, the average production of an acre of corn in the U.S. has grown by 16.1 bushels per acre. While some of this gain can be attributed to conventional genetic advancement, most is trait driven.
In the last 10 years, the average production of an acre of wheat in the U.S. has grown by just 0.2 bushels per acre. If you want to see how that yield-boost discrepancy has played out on the ground, you need go no further than Kansas. Ten years ago, the state produced approximately 500 million bushels of the nation’s 2.2 billion bushels of wheat grown each year. Today, more corn is grown in Kansas than wheat. Why? Value.
Thinking of value in the context of wheat, ask yourself what is the value of a trait that controls wireworms? How about an aphid control mechanism inserted in the genetic makeup of the plant? Or what about a plant that uses half the nitrogen of a conventional plant and produces
the same yield. Herbicide resistance is a no brainer nowadays, and drought tolerance is coming!
How soon will the cereal industry adopt the trait-driven technology on the horizon? If experience with corn growers in my sales area is any indication, it will be very quick. Many of them are consistently producing 250 to 300 bushels of corn per acre in a more sustainable manner. But that bag of expensive seed corn is about more than yield. Value is a function of how much a farmer nets after the bills are paid. This is where the technology shines.
As for those nonfarmers who ask what transgenic wheat has in it for them, how about millions of tons less pesticide used to control weeds and insects, and millions of tons less soil erosion, not to mention millions of tons less hydrocarbon emissions from fewer passes by tractors over fields.
But perhaps the most important advantage accruing to transgenic wheat is the ability to feed the additional two billion people that demographers tell us will live on the planet just 37 years from now. For those who turn their faces away from the scientific leap transgenic crops represent, I ask you to consider the 870 million people on the planet who are starving each year, of whom 60 percent are women and five million are children.
Yes, there will be challenges as transgenic wheat comes to the market, but as I found in my early years dryland wheat farming and now, in my later years as an independent seedsman, challenges are what makes us stronger.
Dana Herron, who is part owner of Tri-State Seed, has been a Washington Grain Commissioner for six years.