Establishing a seed firm

BY Meenaa.B ABM-08-016

Contents
y Introduction y Structure of seed industry in India y Steps in establishing a seed industry y Selecting of crops and varieties y Deciding the scale of business y Class of seed to produce y Seed processing y Packaging and handling Seed storage y Seed marketing y Oppurtunities y Current challenges before seed industry y Suggestion for strengthening of seed industry y Conclusion

Introduction
 The seed industry is a part of great primary industry of agriculture  It comprises of complex interlocking operations necessary to

ensure a regular supply of uniform ,high-quality seeds to the farmers  The seed industry cannot be studied in isolation .(Thomson, An Introduction to Seed technology )  Seed is the only part of the agricultural chain that is growing at 20% a year and is insulated from both government subsidies and weather vagaries. And, in the clamor for higher yields and greater farmer acceptance, seed companies are hitting a sweet spot in innovation.(Economic times)

 The value of the seed market is estimated to be close to $ 1

billion  Seed is the only vehicle to carry superior genetics with high yield potential and biotech traits to the farmer.
 Technology delivery to both small and big farmers through seed

is the most convenient and effective way (as compared to other productivity enhancing inputs like fertilizers, irrigation etc).
 Seed offers low cost - easy to deliver, solutions for raising the

crop productivity.
(www.worldseed2003.com/invitation.htm). ,N.S.Rathore & Avinash ramdeo

Structure of seed industry in India

y The seed industry is its heterogeneity in many dimensions. y In terms of organization, the seed industry consists of a large

public sector and a growing private sector. y Private seed firms are heterogeneous with respect to size, research capacity and product segments. y In terms of ownership, private firms are closely held and not listed in the stock exchanges although some of the large firms have sold equity to foreign seed companies.

Bharat Ramaswami Indian Statistical Institute , Understanding the Seed Industry: Contemporary Trends and Analytical Issues

y Farm saved seeds: 75% y Commercial seeds: 25% y Of the commercial sector: private 76% and public 24% ( by

volume) y Of the private sector: organised is 57 % (with research capabilities) and the small sector/largely unorganised is 43% ( no research)

sectoral report robobank

Steps in establishing a seed business

y Market research is an organized way for business people to get accurate y y y y y y y

information to help them plan and organize their business. For which crops and varieties do farmers want seed? What price are farmers willing to pay for seed? How much seed should a business produce each season? What amount of seed are individual farmers likely to buy? From where would farmers prefer to buy seed? Which other customers besides farmers may be interested in buying seed? What are the laws on seed production for specific crops?

HANDBOOK FOR SMALL SCALE SEED PRODUCERS , CIAT

Selecting of crops and varieties

y Crops and varieties to produce and how many different crops

to handle. y Field crops or pulses or vegetables y Commonly grown local varieties or improved varieties

HANDBOOK FOR SMALL SCALE SEED PRODUCERS , CIAT

Deciding the scale of business

y In doing market research, it is important to consider the

target. y Ability to supply seed mainly to farmers in the village nearby ,to farmers in a wider area (many villages), the whole district or a wider region y Depends on how big the business to be and the resources (land, labour, money, time)

Marcel Bruins International Seed Federation

Class of seed to produce

y Seed is classified into classes to show differences in quality.

o o o o

For crops such as beans, quality is measured by the germination rate, purity, and whether the seed is sufficiently free of diseases. Certified seeds Improved seeds Farmers seeds Truthfully labeled seeds.

FOSTERING A FLEDGLING SEED INDUSTRY Alexander Grobman*

Seed processing
y Seed processing is that segment of the seed industry

responsible for upgrading seed improving planting condition of seed, and applying chemical protectants to the seed. Advantages of seed processing: y Make possible more uniform planting rates by proper sizing y Improve seed marketing by improving seed quality y Prevent spread of weed seed y Prevent crops from disease by applying chemical protectants y Reduces seed losses by drying y Facilitate uniform marketing by providing storage from harvest time until the seed is needed for planting.
http://reveg-catalog.tamu.edu/12-Seed%20Processing.htm Seed technology by rattan lal agarwal

Seed Management Techniques

y Seed pelleting : Seed pelleting is the process of enclosing a

y y y y y y y y

seed with a small quantity of inert material just large enough to produce a globular unit of standard size to facilitate precision planting. Some of advantages seed pelleting are : It increases seed size Singling of seeds by prevention of clogging Precision planting Attraction of moisture Supply of growth regulators, nutrients Stimulation of germination Influence of micro environment Supply of oxygen

Packaging
y Filling of seed bags to an exact weight y Placing leaflets in the seed bags regarding improved

cultivation practices y Attaching labels certification tags y Storage of seed bags

Seed storage
y Preservation of seed with initial quality until it is needed for

planting. y Reducing the rate of deterioration to the degree required to maintain an acceptable level of quality for the desired period. y Seed godown should be in a place where transport facilities are easily available. y Seed godowns should not be constructed in areas near seashore. Since the high RH of atmospheric air accelerate the deterioration of seed.

FOSTERING A FLEDGLING SEED INDUSTRY Alexander Grobman*

y Seed godown should not be constructed in low lying water y

y y y y

stagnating areas. Seed godown should be constructed in places where atmospheric RH is low, free circulation of air is possible, sunlight is adequate and elevated in nature. The ventilators should be at bottom for free air circulation. Ground moisture should not reach the floor. The height of the stack should not be more than 6-8 bags. Seed lots can be fumigated with Aluminium phophide @ 3 gm/cu.m in air tight condition for 7 days. This can be done as propylatic measure and on minimum infestation by insects.

Seed Marketing
y Demand forecasts y Marketing structure y Arrangements of storage of seeds y Sales promotional activities y Post sales services y Economics of seed production and pricing

Seed industry sectoral report MANAGE hyderabad

Seed firm

Investment
y 30 lakhs investment is needed y Machineries cost 6.5 lakhs. y Contract farming 200000/acre/per annum

Human resource management

y For a small scale seed enterprise , minimum of 3 labors and 2 y y y y y

staffs are required. The labors can be used for field works , processing, threshing storing , packaging . Monthly salary . Incentives and bonus are given to make them work efficiently and effectively. The office staffs maintains records ,account books , vocuhers receipts . Training on seed technology , seed processing , sampling are also given to them

y For contract farming All the requirements of production is

given. y These growers are supplied with the foundation seed that is used to produce commercial seed.

Financial analysis
y Fixed and working costs y The selling price y Estimated Annual income from sales y Profitability of the business

Opportunities
y Considering the huge area in each crop, the potential for

quality seed supply is very high. y The average yield is much lower in India in most of the crops even compared to the neighbouring countries. y The hybrid crops are more wanted by farmers especially in vegetable crops .

Current challenges before seed industry

y Farmers saved seed y Farmers can commercialize the informal seed sale y Inadequate service and supply system y Technology (Low productivity and low level of adoption) y High post harvest losses y Attempts to establish very broad patents Collection of

royalties by public institution y Exclusive rights to private companies y Concentration of power to private y Regulation of transgenic crops

y Only

environmentally viable transgenics will be recommended for release y Examination for toxicity and other safety related aspects y Risk on saving the processed seeds. y The seasonal nature of seed production limits flexibility in matching output with demand since it is difficult to influence unforeseen events during the seasons in which they occur.

Suggestion
y SeedVillage scheme can be promoted y Contract seed production at the farmers field could be y y y y

encouraged Scientific seed processing and storage should be strengthened. Seed Bank may be established to meet the demand during natural calamities Intensive training to stakeholders in quality seed production Increasing awareness and adoption hybrid seeds by the farmers.

Conclusion
On the whole, successful small-scale enterprises are those that: y Are formed by a combination of new ideas with attractive attributes of existing local systems of seed production. y Have a lasting impact, by showing a capacity to survive in the long-term ,are not continuously dependent on external support. y Have close links with relevant formal sector seed activities so that the farmers benefit from investments in variety research, associated technologies and quality control services. y Serve as dependable sources of good seed or that contribute to higher productivity and prosperity in the community.

References
y AOSA, 1983. Seed vigour testing handbook. Rules for testing y y y y

seeds. J. of SeedTechnol., 12 (3) : 415 450. CIAT ,2002 .Business skill for small scale seed producer. Soniia David and Beth Oliver., : 35-43 Rattan Lal Agarwal ,1980 Seed technology .seed processing .., 293 -297. Rattan Lal Agarwal ,1980 Seed technology .seed marketing .., 422 -437. Veeraraghavan ,J. 1969 .Economics of seed production, Proc seed specialists seminar ,New Delhi

y Carr, M. 1981. Developing small-scale industries in India: An

integrated approach.Intermediate Technology Publications, London, UK.