Hi All,

I am aware we have already had an intense discussion on the issue of Royalty payment in Kaveri Seeds thread and our admin team is currently pruning the thread to ensure forum guidelines are adhered to.

However, this recent article (shared by one of our forum members on the other PF discussion thread) had some key aspects, and if these turn out to be true (or) if these materialize, the dynamics for some of the seed companies including Kaveri could change:

http://www.livemint.com/Politics/dVswDy3kCTNFl3wswTKEPO/BT-Cotton-sales-by-CICR-may-bring-down-seed-cost-of-farmers.html

Summary of the article -

1. On 19th August, Ministry of agriculture has written a note to PM informing that CICR can proceed with domestic varieties of BT Cotton, as Monsanto's patent on gene Mon 531 or Cry1 had expired in US in 2012.
   Note for new readers: What is Mon 531? - "The Mon 531 Cry 1 is the gene added to cotton seeds to provide protection to the cotton plant from the attack of bollworm, the most commonly found pest on the cotton plant. The presence of this additional gene makes the cotton seed variety a BT or biologically modified variety."

2. Since 2012, countries like Pakistan have already developed 31 new varieties of BT Cotton seeds and made it available to farmers.

3. Agriculture ministry has further asked ICAR(Indian Council of Agricultural Research) to develop BT Cotton variety seeds and provide it to farmers.

4. Keshav Kranti, Director of CICR(Nagpur) says they have developed 21 varieties of BT Cotton and are gearing up to make these available for farmers by 2017.

5. These Indian BT cotton varieties can be reused for next year's sowing in-case the farmer was not able to use it in the current year.

6. The Indian variety to be made available at 150/kg compared to 2000/kg as charged by Monsanto licensed varieties.

Monsanto's comments on the above points: (Have copy pasted to ensure I don't misrepresent anything)

“Monsanto has various intellectual property rights covering its cotton technologies in India. The MON 531 event (BG I) which expresses the Cry1AC gene has not been, in itself, patented in India by Monsanto,” a spokesperson for Mahyco Monsanto Biotech (India) Pve Ltd said in an emailed response. “However, Monsanto does enjoy proprietary rights over the MON531 event pertaining to regulatory data, biological materials, trade secrets, know-how and the like. The technology registrant also has proprietary rights and corresponding obligations over technologies commercialized under its registration/approvals for MON531 granted by regulatory authorities such as GEAC and applicable Indian laws”

“The MON 15985 event has MON 531 as a component to which Cry2Ab has been added, providing additional mode of action, and leading to wider spectrum of insect control. Monsanto has been granted a patent in respect of the MON 15985 event in India. We claim proprietary rights over the MON 531 event by virtue of the various buckets of rights available to us and hence our claim has to be viewed from a holistic perspective rather than a singular patent lens.”

“Further, we receive trait fees in consideration for our technology solutions and services to Hybrid Cotton Seed companies. We believe in the power of innovation and partnerships to help farmers benefit. To this effect, MMB has collaborated extensively with over 45 Indian seed companies to ensure India’s cotton farmers have the widest choice of hybrid Bt cotton seeds while providing the technology to a broad spectrum of cotton see companies,” said the company in its response.

My comments/questions on the above points:

1. On 19th August Ministry of agriculture has written a note to PM informing that CICR can proceed with domestic varieties of BT Cotton, as Monsanto's patent on gene MON531 or Cry1 had expired in US in 2012.
If the patent had expired in 2012, why did any of our Private/Government organizations not develop Indian BT Cotton seed variety all these years?

2. Since 2012, countries like Pakistan have already developed 31 new varieties of BT Cotton seeds and made it available to farmers.
How effective are these BT cotton seeds compared to the ones sold by Kaveri/other seed companies?

4. Keshav Kranti, Director of CICR(Nagpur) says they have developed 21 varieties of BT Cotton and are gearing up to make these available for farmers by 2017.
Same question as above - 1. Effectiveness? 2. They are talking about launch by 2017. Will CICR have the capacity to meet the overall seeds demand?

5. These Indian BT cotton varieties can be reused for next year's sowing in-case the farmer was not able to use it in the current year.

6. The Indian variety to be made available at 150/kg compared to 2000/kg as charged by Monsanto licensed varieties.

Do cotton seed companies have the pricing power? I mean lets assume there are 2 varieties available in the market. CICR's cotton seed priced at 150rs and Monsanto licensed variety(Jadoo, Jackpot,ATM,etc) at 1500-2000rs. Will farmers continue to buy Monsanto licensed version which he has been buying for the last few years? Now the farmer also has the added incentive of the ability to reuse the seed in the NEXT sowing season. will this incentivize him to switch?

More importantly, what is the likelihood that government will pursue this option? This being a politically sensitive issue(read farmer suicide) my feeling is this initiative will have government support.

Having said this, nothing is going to change immediately for Kaveri/anyother seed companies. CICR itself is foreseeing this launch only by 2017. But market discounts future events vs past performance.

Dear Admin team: The intention of this post is to have a discussion on some of the above points. If this post doesn't adhere to forum guidelines please feel free to do anything that is appropriate.

Thanks,
Ravi S
Disc - Kaveri forms ~7.5% of my PF