Sustaining Cotton Yield
4THASIAN TEXTILE CONFERENCE Theme: ‘Challenges of the Slowdown’
Sustaining Cotton Yield Dr. Gyanendra Shukla Director – Monsanto India 18th September, 2009
Topics for discussion… • Monsanto • Challenges • Role of Agriculture biotech • New technologies to help grow sustainably
Monsanto Company “Agriculture is our only business” Focused on the farmer… “We succeed when farmers succeed” Hugh Grant, Monsanto CEO
Focus Crops
& future of agriculture Monsanto is 100% focused on Agriculture
R&D in Agriculture
Corn • Cotton • Oilseeds (Soybean & Canola) •
• • •
Fruits & Vegetables Sugarcane Wheat
Seed & Traits 95%
Ag Chemistry 70%
Committed to improve Indian farm productivity
Partnership with Indian farmers for over four decades
~700 employees - 80% from rural backgrounds
Ranked among Top 50 Great Places to Work, 2008 & Best in the sector
Focus in India
Cotton
Seeds – Paras Brahma Bollgard Bt cotton hybrid seeds
Traits – Bollgard Bt cotton (via JV – Mahyco-Monsanto Biotech)
Corn – Dekalb India’s leading corn hybrid
Fruit & Vegetable – Seminis hybrid Seeds
Agrochemicals – Roundup, world & India’s no.1 herbicide
Key resources like land and water constrained Cultivated land for food grains has been stagnant, even declining
While water table has been depleting rapidly
Red represents water table depleting due to draw-out being greater than replenishment, while blue represents the reverse trend : Other colors follow the rainbow spectrum Sources 1. Area under cultivation data from Fertiliser Statistics, 2006-07, The Fertiliser Association of India, New Delhi. 2. India water table changes map from http://www.nasa.gov/images/content/378542main_india_gw_rate1.jpg
Looming loss of food security in India calls for constant efforts to improve productivity Rising incomes
Food basket changes
• Per capita income likely to move to ~USD 1700 by 2020, compared to ~ USD 1000 now
• Greater demand for meat and poultry will put pressure on cereals • Greater demand for fruits, vegetables, and protein
Stagnant agriculture • Productivity of key food crops barely growing • Pressure on land, water, labor availability, etc.
Gap in Millions of metric tons
Demand – Domestic-Supply gap in key food crops in India
Source : ICRIER working paper No. 209, March 2008 : Demand supply trends and projections of food in India
Agricultural inputs/practices critical for increased productivity Area
Seeds
Technology, research critical to constantly improve seeds
Plant nutrition
Fertilizer penetration high but scope to improve balance of fertiliser types
Irrigation
Well irrigation overused, canals investment intensive
Agronomic practices
Training can play crucial role Mechanization may be necessary
Production
Productivity
Significant growth potential Moderate potential Limited potential, constrained lever
A holistic action plan and policy environment is urgently needed for Indian agriculture to reach its potential…
Significant work on technology in private and public sectors, has borne fruit Doubling of yields in cotton
Corn yields up by 60%
Production – M bales Area – M acres 35
30
Yield – T / Ha 250
Source: Cotton Corporation of India
Biotech product Bollgard Cotton
200
25
Source: Ministry of agriculture
Hybridization rate up to 46%, with both public and private research
150
20
15
100
10 50 5
0
0 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 Production
Area
Yield
Significant untapped potential in these crops, no private research in several crops…
Cotton is the only exception to stagnant crop yields kg/acre 1200
Wheat
CAGR % (0.6%)
World average 1,125
Rice
1.5%
1,603
(0.4%)
1,368
4.2%
1,327
12.8%
293
1000
800
Corn
600
Soybean 400
200
Cotton
BG launch
0 2000-01
2001-02
2002-03
2003-04
2004-05
Source: Ministry of Agriculture, Agricultural Statistics 2006-07
2005-06
2006-07
• Other than wheat, India is nowhere near world average • Seed replacement rates are low
Botla Kumara Swamy, Warangal, AP
Swamy cultivates Bollgard II Bt cotton on 4 acres. He feels prides in… • building a pucca home ~Rs. 1.5 lac • purchasing a second-hand motorcycle • installing pipeline for his field • his new milk collection centre which helps him to earn ~ Rs. 15,000 per month Higher yields of 14 quintals per acre with Bollgard II vs. only 6 quintals per acre with conventional seeds have helped him earn higher income of Rs. 22,000 per acre, thus enabling the Swamy family to lead a better life.
Adoption is driven by significant benefits Additional income
Intangible benefits • Time saved in the field (41%)
• Higher Yield (162%) – From 300kg /ha to 650 kg/ha
• Reduced pesticide usage (80% less) – From 31,393MT to 6278 MT
• Higher profits – INR 23,386/ha for BG and BGII farmers
Source: IMRB Samiksha 08
• Peace of mind (35%) • Better life (34%) Overall benefits to the economy • INR 12,608 crore additional income to economy – Rural employment – Investments by Ag industry – Exports
• Less tension with cotton cultivation (33%) Note: % farmers who cited the above as benefit
Monsanto’s Commitment to Sustainable Agriculture
Improved seeds and agronomics for corn, soy, & cotton farmers to double yields from 2000-2030
Conserve More
Improved seeds and agronomics that reduce aggregate use of key resources by 1/3 per unit of output by 2030 v/s 2000
Produce More Improve Farmers’ Lives
Improved seeds and agronomics proven to make farmers of all sizes more productive including >5M additional subsistence farmers by 2020
12
A World of Biotechnology Benefits New Traits
Biotechnology continues to improve…
Drought tolerant
Bollworm Control
2002 13
Widerspectrum pest control
Better weed control
Water Conservation
2010
Greater Benefits
Fiber Quality
Intrinsic yield
Increased cotton Production
…the productivity of our agriculture 2013
2015
Roundup Ready® Flex Cotton – efficient weed management/better returns Increased tolerance to over-the-top application Increased margin of crop safety with applications beyond 5th leaf stage More “flexible” weed control Increased grower convenience Reduced need for specialized spray equipment Over-the-top window of application Roundup Ready® Flex Cotton Roundup Ready® Cotton (< 4 lf.)
Emergence
Discovery
Layby
Preharvest Harvest
Phase 1
Phase 2
Phase 3
Phase 4
Proof of Concept
Early Development
Adv. Development
Pre-Launch
Launch
Overcoming Insufficient Fresh Water for Crop Usage Drought Tolerant Cotton • Drought leads advancing to greenhouse screens • First leads in field testing are showing promise • Up next: Continued evaluation to assess drought performance
Discovery
Phase 1
Phase 2
Phase 3
Phase 4
Proof of Concept
Early Development
Adv. Development
Pre-Launch
Launch
Biotech and education will continue to play an important role in future 650
Lint kg/ac 250
600
INDIA COTTON LINT YIELD (KG/AC)
580
273 kg/ac BIOTECH + Education
550 500
200
Cumulative yield gains
450 400
150
350
100
300 250
50
84 kg/ac GERMPLASM
224
200 150
1970 1974 1978 1982 1986 1990 1994 1998 2002 2006
0
100
Lint Yield
Trend
Nurturing environment will drive investment and competition for superior technologies The business environment can drive, or drive away, investments into R&D More investm ent
R&D Investm ent
3 Primary components of a nurturing environment 1
Stable, transparent, regulation
•Scientific : Fact based •Stable : No uncertainty •Safe : For all stakeholders • Simple : To comply with
Virtuous cycle Value for IPR owners
Value creation for farmers
Low further investm ent
R&D Investm ent
Vicious cycle
Difficult / low value for IPR
Value creation for farmers
2
3
IPR laws & enforcement
Value sharing business models
• • • •
Strong : Deterrent to IPR theft Simple : Low ambiguity Swift : Speedy enforceability Single : Agency for regulation & enforcement as in Telecom
• For hybrid led crops like Cotton • Freedom to price • Competition led market • For single line crops like wheat • Public-private partnership models to enable value sharing
Comments…
Sustaining Cotton Yield Dr. Gyanendra Shukla Director – Monsanto India 18th September, 2009
Topics for discussion… • Monsanto • Challenges • Role of Agriculture biotech • New technologies to help grow sustainably
Monsanto Company “Agriculture is our only business” Focused on the farmer… “We succeed when farmers succeed” Hugh Grant, Monsanto CEO
Focus Crops
& future of agriculture Monsanto is 100% focused on Agriculture
R&D in Agriculture
Corn • Cotton • Oilseeds (Soybean & Canola) •
• • •
Fruits & Vegetables Sugarcane Wheat
Seed & Traits 95%
Ag Chemistry 70%
Committed to improve Indian farm productivity
Partnership with Indian farmers for over four decades
~700 employees - 80% from rural backgrounds
Ranked among Top 50 Great Places to Work, 2008 & Best in the sector
Focus in India
Cotton
Seeds – Paras Brahma Bollgard Bt cotton hybrid seeds
Traits – Bollgard Bt cotton (via JV – Mahyco-Monsanto Biotech)
Corn – Dekalb India’s leading corn hybrid
Fruit & Vegetable – Seminis hybrid Seeds
Agrochemicals – Roundup, world & India’s no.1 herbicide
Key resources like land and water constrained Cultivated land for food grains has been stagnant, even declining
While water table has been depleting rapidly
Red represents water table depleting due to draw-out being greater than replenishment, while blue represents the reverse trend : Other colors follow the rainbow spectrum Sources 1. Area under cultivation data from Fertiliser Statistics, 2006-07, The Fertiliser Association of India, New Delhi. 2. India water table changes map from http://www.nasa.gov/images/content/378542main_india_gw_rate1.jpg
Looming loss of food security in India calls for constant efforts to improve productivity Rising incomes
Food basket changes
• Per capita income likely to move to ~USD 1700 by 2020, compared to ~ USD 1000 now
• Greater demand for meat and poultry will put pressure on cereals • Greater demand for fruits, vegetables, and protein
Stagnant agriculture • Productivity of key food crops barely growing • Pressure on land, water, labor availability, etc.
Gap in Millions of metric tons
Demand – Domestic-Supply gap in key food crops in India
Source : ICRIER working paper No. 209, March 2008 : Demand supply trends and projections of food in India
Agricultural inputs/practices critical for increased productivity Area
Seeds
Technology, research critical to constantly improve seeds
Plant nutrition
Fertilizer penetration high but scope to improve balance of fertiliser types
Irrigation
Well irrigation overused, canals investment intensive
Agronomic practices
Training can play crucial role Mechanization may be necessary
Production
Productivity
Significant growth potential Moderate potential Limited potential, constrained lever
A holistic action plan and policy environment is urgently needed for Indian agriculture to reach its potential…
Significant work on technology in private and public sectors, has borne fruit Doubling of yields in cotton
Corn yields up by 60%
Production – M bales Area – M acres 35
30
Yield – T / Ha 250
Source: Cotton Corporation of India
Biotech product Bollgard Cotton
200
25
Source: Ministry of agriculture
Hybridization rate up to 46%, with both public and private research
150
20
15
100
10 50 5
0
0 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 Production
Area
Yield
Significant untapped potential in these crops, no private research in several crops…
Cotton is the only exception to stagnant crop yields kg/acre 1200
Wheat
CAGR % (0.6%)
World average 1,125
Rice
1.5%
1,603
(0.4%)
1,368
4.2%
1,327
12.8%
293
1000
800
Corn
600
Soybean 400
200
Cotton
BG launch
0 2000-01
2001-02
2002-03
2003-04
2004-05
Source: Ministry of Agriculture, Agricultural Statistics 2006-07
2005-06
2006-07
• Other than wheat, India is nowhere near world average • Seed replacement rates are low
Botla Kumara Swamy, Warangal, AP
Swamy cultivates Bollgard II Bt cotton on 4 acres. He feels prides in… • building a pucca home ~Rs. 1.5 lac • purchasing a second-hand motorcycle • installing pipeline for his field • his new milk collection centre which helps him to earn ~ Rs. 15,000 per month Higher yields of 14 quintals per acre with Bollgard II vs. only 6 quintals per acre with conventional seeds have helped him earn higher income of Rs. 22,000 per acre, thus enabling the Swamy family to lead a better life.
Adoption is driven by significant benefits Additional income
Intangible benefits • Time saved in the field (41%)
• Higher Yield (162%) – From 300kg /ha to 650 kg/ha
• Reduced pesticide usage (80% less) – From 31,393MT to 6278 MT
• Higher profits – INR 23,386/ha for BG and BGII farmers
Source: IMRB Samiksha 08
• Peace of mind (35%) • Better life (34%) Overall benefits to the economy • INR 12,608 crore additional income to economy – Rural employment – Investments by Ag industry – Exports
• Less tension with cotton cultivation (33%) Note: % farmers who cited the above as benefit
Monsanto’s Commitment to Sustainable Agriculture
Improved seeds and agronomics for corn, soy, & cotton farmers to double yields from 2000-2030
Conserve More
Improved seeds and agronomics that reduce aggregate use of key resources by 1/3 per unit of output by 2030 v/s 2000
Produce More Improve Farmers’ Lives
Improved seeds and agronomics proven to make farmers of all sizes more productive including >5M additional subsistence farmers by 2020
12
A World of Biotechnology Benefits New Traits
Biotechnology continues to improve…
Drought tolerant
Bollworm Control
2002 13
Widerspectrum pest control
Better weed control
Water Conservation
2010
Greater Benefits
Fiber Quality
Intrinsic yield
Increased cotton Production
…the productivity of our agriculture 2013
2015
Roundup Ready® Flex Cotton – efficient weed management/better returns Increased tolerance to over-the-top application Increased margin of crop safety with applications beyond 5th leaf stage More “flexible” weed control Increased grower convenience Reduced need for specialized spray equipment Over-the-top window of application Roundup Ready® Flex Cotton Roundup Ready® Cotton (< 4 lf.)
Emergence
Discovery
Layby
Preharvest Harvest
Phase 1
Phase 2
Phase 3
Phase 4
Proof of Concept
Early Development
Adv. Development
Pre-Launch
Launch
Overcoming Insufficient Fresh Water for Crop Usage Drought Tolerant Cotton • Drought leads advancing to greenhouse screens • First leads in field testing are showing promise • Up next: Continued evaluation to assess drought performance
Discovery
Phase 1
Phase 2
Phase 3
Phase 4
Proof of Concept
Early Development
Adv. Development
Pre-Launch
Launch
Biotech and education will continue to play an important role in future 650
Lint kg/ac 250
600
INDIA COTTON LINT YIELD (KG/AC)
580
273 kg/ac BIOTECH + Education
550 500
200
Cumulative yield gains
450 400
150
350
100
300 250
50
84 kg/ac GERMPLASM
224
200 150
1970 1974 1978 1982 1986 1990 1994 1998 2002 2006
0
100
Lint Yield
Trend
Nurturing environment will drive investment and competition for superior technologies The business environment can drive, or drive away, investments into R&D More investm ent
R&D Investm ent
3 Primary components of a nurturing environment 1
Stable, transparent, regulation
•Scientific : Fact based •Stable : No uncertainty •Safe : For all stakeholders • Simple : To comply with
Virtuous cycle Value for IPR owners
Value creation for farmers
Low further investm ent
R&D Investm ent
Vicious cycle
Difficult / low value for IPR
Value creation for farmers
2
3
IPR laws & enforcement
Value sharing business models
• • • •
Strong : Deterrent to IPR theft Simple : Low ambiguity Swift : Speedy enforceability Single : Agency for regulation & enforcement as in Telecom
• For hybrid led crops like Cotton • Freedom to price • Competition led market • For single line crops like wheat • Public-private partnership models to enable value sharing
Comments…
