Seeds: Factors Challenging the Market

If you take just a moment to observe your local gardening shops or department store markets, youโ€™ll see that seed demand is steadily growing. Not just in volume, but also variety. How many different kinds of pumpkin seed are there? It seems like every spring brings with it a new type of bean seed for planting those much-loved garden rows.


With so many varieties and ever-changing demands from the market, some suppliers are struggling with how to meet all these needs - especially when it comes to supply chain management challenges.


The 21st century has seen a dramatic shift in the food system and agricultural practice. Today, sustainable agriculture and organics are becoming the norm. It was reported that organics accounted for $2 billion of U.S. food sales a decade ago; and that number reached . The concern for sustainability is reflected not only in agriculture but also in peopleโ€™s buying preferences โ€“ organic stores like Whole Foods have seen an 8% increase in sales while grocery store chains such as Safeway have reported a decline of 3%. Therefore we can see that there is strong demand for organic products because they provide several benefits to society (i.e., lower greenhouse gas emissions, less chemical fertilizer runoff).


The impact of the organic food industry is also felt within the seed industry. Organic farmers must only use seeds that are certified as organic by the United States Department of Agriculture (USDA) rule. In order to obtain this certification, a seed company must have spent certain funds to test and produce each variety of seed and must pass a microbiological inventory to test for harmful pathogens. This means that if an organic farmer wishes to purchase, or even sell, certain seeds, those seeds must be certified as being non-GMO. In order to be certified, a seed must be created from a parent variety that has been certified as being non-GMO and may not have been genetically altered with the use of herbicides or pesticides. Of course, only those farmers who are able to buy organic seeds are able to comply with these restrictions.


If you're a fan of eating food that's fresh, wholesome, and natural, you know that seed quality is one of the most important factors in determining what kind of produce you'll buy. And with so many different types available to choose from โ€” such as heirloom varieties and organic produce โ€” it can be tricky for farmers to know which seeds to plant. Knowing your market demand will help them make the right decision.


The difference between the number of conventional seeds vs organic ones has been steadily on the rise since 1995 due to higher demand for healthier crops. But despite this increase, there are still nearly three quarters of U.S. acres planted with organic seeds, while only one percent of conventional acres are organic, as reported by DuPont Pioneer.


To help you understand the relationship between market demand and seed quality, we surveyed more than 1,200 farmers about what they're growing and how much demand there is for certain crops. We wanted to know how the best types of produce grow in relation to each other and which produce they said was most popular. And we asked if they found it difficult to select the right varieties for growing in the current environment (such as importation policies and weather patterns). Lastly, we dove into their marketing strategies to learn why growers choose certain varieties over others when selling their produce.


A study was conducted by the American Farm Bureau Federation's Market Access program, which works with farmers around the country to develop measurements of market demand for commodities and to estimate economic impacts by providing input to congressional reporting and trade negotiations.


What researchers found:


For nearly two thirds of growers we surveyed, water availability is the largest challenge they face when deciding what kinds of crops to grow. Water availability has been a major issue in recent years, with many areas of the country facing major water shortages (see Figure 1). When asked if they'd be more likely to plant a particular crop if there was less competition for water, 74 percent responded that they would.


Across all crops, the most common varieties grown by farmers are those that offer some resistance to pests and diseases. When asked whether they'd be more likely to plant a particular crop if their crop was less susceptible to pests and diseases, 44 percent responded they would. A similar percentage of growers we surveyed said they would be more likely to plant certain classes of crops if they were easier to protect from insects with pesticides or resistant to disease.


Compliance continues to play an important role in farmers' decision-making process when it comes to purchasing heirloom seeds, but it's not always the easiest choice for them.

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