Du Pont's Pioneer combating fake seeds

Law enforcement staff from Wanrong county, Shanxi province, tell a farmer how to distinguish fake corn seed. Nearly 70 percent of corn seed sold in China is counterfeit, according to Li Shihua, general manager of Bayan Jianong Agriculture Co Ltd. Provided for China Daily

Pioneer, a unit of US chemicals maker EI du Pont de Nemours and Co, is building up its dealer network and research facilities in Northeast China. The world's largest hybrid-corn-seed producer by market share wants to tackle the market in counterfeit seeds in the nation's largest corn-grain-planting region.

Almost half China's farmland is in the north, particularly the northeast, where land doesn't always depend on heavy irrigation. The region can increase corn, rice and soybean output.

The amount of counterfeit seeds in northeastern provinces such as Heilongjiang and Jilin has increased over recent years as China's grain-production base moved gradually from the south to the northeast.

Li Shihua, general manager of Bayan Jianong Agriculture Co Ltd, the biggest seed and agricultural-production material supplier in Bayan, said around 70 percent of corn seed sold in the county is counterfeit and quite common for the whole northeast region.

"I have never seen so many fake seeds before," Li said.

Li began to sell DuPont Pioneer's corn seed in 2007.

"What has affected our sales is the large volume of counterfeit seeds illegally produced by other companies copying Pioneer's hybrids," Li said. They have low germination and come with no after-sales service, Li said.

The seeds are cheaper and their sale has caused turmoil in the market, Li said.

Pioneer President Paul Schickler said counterfeit seed is an issue for Pioneer, other seed companies and farmers who have a right to receive quality and authenticity.

The flood of fake seeds is not a local problem. An estimated 8,400 seed companies operate in China but fewer than 100 own their intellectual property rights.

More than 90 percent of the companies are small or medium-sized and have lower levels of research and technology than other competitors. Around 32 percent sell counterfeit seeds every year, according to a report by the research center for rural economy at the Ministry of Agriculture last November.

"While progress has been made, we believe the anti-counterfeiting work can be further enhanced in certain areas, so that all seed companies are confident," Schickler said.

Pioneer has around 1,400 business partners in northeast China, with 350 in Heilongjiang. Over 30 percent of its sales network in northeast China is located in the province.

"Over the last several years, we have doubled our investment in China and will continue this pace of investment in the next five years," Schickler said. Delaware-based DuPont spends $2 billion on research every year, 60 percent of it in its agriculture and food businesses, including Pioneer.

"We are going to continue investing in local research, seed production, education," Schickler said. It "all results in developing high-quality seed, transferring the seed knowledge to farmers."

Ding Lixin, a researcher at the Chinese Academy of Agricultural Sciences in Beijing, said ensuring sufficient grain supply is critical to China's development and the government needs to take more measures to promote the protection of intellectual property rights and combat fake seeds.

"When local companies become bigger and more competitive with their own seed products it will be different," Ding said.

"That will help the government create new policies to support their research and development, and so allow foreign companies to increase investments and patent technologies in China."

Animal feed production and the bio-chemical market have been boosted by a booming food-processing industry.

China's demand for corn has surged. More than 70 percent of the country's annual corn production was consumed by these three industries.

In the northeast, Pioneer will develop its research in joint ventures.

The aim is to extend its research network into key corn-growing areas. It's also active in deployment and development of drought-tolerant products for China.

Since establishing itself in the country in 1997, Pioneer has founded three joint venture seed factories and employed nearly 700 workers. It plans to increase its research centers in the country to 15 from 11 by 2017.