Open Source Seeds

I’ve been reading an excellent book called the Omnivore’s Dilemma by Michael Pollan recently. The first section of the book, entitled “Industrial Corn” investigates the state of industrial agriculture in the United States, which it turns out, revolves around commodity corn.

One of the shocking revelations for me from Pollan’s well researched discourse on the agriculture business is that corn growers, despite an almost-50% federal subsidy for growing corn (relative to the cost of growing it), virtually cannot make a profit. Corn growers are paid by two sources: the grain elevator and the government. The grain elevator pays the market rate of around $1.45 per bushel. Then, the federal government subsidies the rest up to a defined “target price”, say $1.87, or $0.42 in subsidy per bushel. However, the total payments to the corn farmer barely cover their costs, and many farmers, including one interviewed by Pollan must take on second jobs to feed themselves. The large corn subsidy is largely passed on to buyers of corn products (to find out why this is, I’d recommend you read the book).

If you drill into American corn farmers’ operating costs, you’ll see that they break down into 21% for seed, 37% for fertilizer, and the remaining 41% spread across a number of smaller categories. Before you take those costs for granted, let’s consider why farmers have to pay for seed. Simply put, farmers work on fixed plots of land, and to make the most money, they need to grow as much corn as they can. Different corn seed varieties, each with different characteristics, have been bred by humans since the Mayans. In the last century, this effort was picked up by corporations, like Monsanto, which found a way to breed corn so that their seeds would produce plants which cannot produce more good seeds. This innovation allowed these companies to monetize innovations which improved corn seed yields, and their well-funded efforts quickly produced better yielding seeds than any freely available seeds (10x growth in corn yields since the turn of the 20th century).

The higher yields from proprietary seeds and inability to produce their own seed keeps farmers coming back to the seed companies every year for a new supply of seeds, which don’t come cheaply. Since the margins of the American corn farmers are so low, this has a relatively large impact on their ability to make a living wage. As you can imagine, this impacts third-world growers even more dramatically. As a result of the price, third-world growers either have to grow less corn using freely-available varieties or pay large sums of money to buy the industrial seeds.

This situation should sound very familiar to anyone who has experience in the software industry. Operating systems are similar – because of lack of a similarly functioning free product, most users have long had little choice but to buy Microsoft Windows. However, the advent of the open source movement, a legal structure around managing the intellectual property behind software whose source code is released to the public, challenged Microsoft’s monopoly on the operating system, giving consumers and business a free alternative. The combination of the new legal structure, as well as a growing global community of collaborators connected to each-other in real-time over the internet, paved the way for the development of the Linux operating system, as well as other free and widely used software products, such as the Apache web server and Firefox web browser.

If an open-source effort around seeds could be started, allowing farmers to collaborate around developing their own open-source breeds of corn, the monopoly that the seed companies have on the American farmer and third-world farmers alike, could be challenged. The key question for the American corn farmer (for corn seeds) is what comparative yield would this open-source corn have to have to get them to the break-even point of profitability relative to the proprietary seeds. Using the cost and revenue structure from this governmental source, if an open-source corn breed could reach just under 85% of the yield of proprietary corn, American farmers would make the same profit. There would be a much greater impact on the third-world, as farmers could collaborate to develop good seeds for different climates, and be able to grow substantially more crops with the same land at much lower cost.

Given the potentially high impact that open-source seeds might have on the American farmer and global poverty, why hasn’t it been done yet? I suspect this is because the model is a harder to apply to seeds. Farmers are less connected to each other than software developers, who are pretty savvy about using the internet to communicate and collaborate. Since collaboration and sharing of collective experience is crucial to the productivity of the open-source software movement, farmers participating in an open-source seed movement would likely have to embrace new communications technologies to collaborate with each other. Also, seeds are harder to distribute, modify, and share than is source code, which can be managed, duplicated, shared, and distributed virtually automatically. A centralized authority (which does not exist in the open-source software world) would likely have to serve as a point of communication and distribution for an open-source seed effort. They’d have to have some resources to store master seeds, grow them to copy them for distribution, and to defend themselves from the almost-certain legal challenges of the incumbent proprietary seed-makers.

The need for the centralized authority is a significant disadvantage relative to the software community. It requires resources, a lot more collaboration than an online newsgroup, and constitutes a centralized point that can be attacked by incumbents. That said, the benefit of open-source seeds is arguably just as large or larger than open-source software: food that can be afforded by everyone can hardly be less important than free software.

~ by onthejohn on April 30, 2008.