1. The Changing Global Private Funding Landscape focussing on the roles of Brazil, China and India
Carl E Pray
With lots of help from but no blame to Keith Fuglie, Jose-Maria da Silviera and Latha Nagarajan

2. Outline Global trends in private agricultural research
Trends in research expenditure in China, India, Brazil
Impacts on agriculture in these countries
Major impact in Brazil
Some impact in India
Limited in China
Technology transfer from these countries
Future trends

3. Private Ag R&D funding growing slowly in high income countries and much more rapidly in others
Fuglie 2016

4. Much of the research of largest firms is focused on low income agriculture
Fuglie 2016

5. Chinese government agricultural research expenditure biggest in world
China
USA
Brazil
India
R&D Expenditure Million US$ converted from local currency using 2009 PPP exchange rates
1960
294
1,254
345
220
2011
4,723
4,403
1839
3771
2011/1960 16
3.5 5 17
Rank 2011 1 2 3
Philip G. Pardey, Connie Chan-Kang, Steven P. Dehmer and Jason M. Beddow Agricultural R&D is on the move Nature September 14, 2016,

6. Private sector research not as large but growing rapidly
China ---very limited in 2000 up to11% of total R&D in 2006 $244 million Chinese firms + pesticide and agricultural machinery + a few foreign firms (privatization and SOEs) Brazil % of total public private R&D 2012 $50 million 1996 to $377 million 2012 Mainly foreign multinational India % total public private R&D 2009 From $44 million 1995 to $271 million % foreign firms

7. Chinese commercial enterprises’ R&D 2016
Ag Machinery –
First Tractor between US $51 million and 1,500 R&D personnel
Foton–Lovol tractors don’t know expenditure by 1,400 scientists, engineers and technicians in R&D
John Deere engineering R&D
Ag Chemicals
ChemChina= Anhui Research Institute of the Chemical Industry+ADAMA $33 million + Syngenta $1.38 billion
SinoChem added the major government research institutes northern research pesticide center.
Livestock
Chia Tai (C-P Thailand) animal feed, poultry breeding and aquaculture
Ringpu Biologicals – veterinary pharmaceuticals and vaccines
$13 million

8. In addition to research, private sector an important importer of technology
“Borrowing”
India – late 1990s NavBharat brings in Monsanto’s Bt trait for cotton
China –2016 Dabeinong’s seed company’s US director pleads guilty to stealing proprietary maize lines from Pioneer and Monsanto
Bt maize and RR soybeans in North China
Imports of inputs and technology
Seeds – vegetable seeds in India, sunflowers and grass seed in China
Pesticides - all from active ingredients discovered abroad –some paid for.
Tractors – technical partnership with foreign firms (next slide)
Biggest imports are fertilizer – not new tech – also import factories
Purchases of companies
India UPL (generic pesticide co.) buys Advanta (seed, biotech) in 2008
ChemChina buys Makhteshim in 2011 and now Syngenta

9. Total Factor Productivity Growth in China,
India, Brazil

10. Imports and exports of fertilizer, pesticides and tractors..
Table 1. Imports and Exports of Fertilizer, Pesticides and Tractors
CHINA
INDIA
Fertilizer 2015
Value in US$
Global Imports of Fertilizers
67,151,565,274
Fertilizer imports by country
3,928,515,015
7,459,460,149
Share in global imports
5.9%
11.1%
Global Exports of Fertilizers
57,808,259,078
57,808,259,078.00
Fertilizer exports by country
10,878,119,513
96,877,924.00
Share in global exports
18.8%
0.17%
Pesticides: 2014
Global value of pesticide imports
34,959,370,800
Pesticide imports by country
770,625,960
990,318,950
% of share in global pesticide imports
2.2%
2.8%
Global value of pesticide exports
34,727,809,340
Pesticide exports by country
4,146,984,440
1,939,991,000
% of share in global pesticide exports
11.9%
5.6%
AgMachinery: 2015
Global value of ag tractors imports
46,578,988,751
Ag tractor imports by country
302,610,139
34,487,518
% of global ag tractor imports
0.65%
0.07%
Global value of ag tractor exports
52,373,540,320
Ag tractor exports by country
1,582,677,906
10,001,841,820
% share in global ag tractor exports
3.02%
19.10%
Sources: Fertilizer and AgMachinery UN-COMTRADE: Pesticides; FAOSTAT

11. Chinese glyphosate exports

12. Chinese pesticide exports to Africa

13. Speculation about future

14. Factors determining growth of R&D
Economic factors
Crop prices drive R&D all countries
Growth of private sector -
China - officially private firms allowed in 2000; shifting government research institutes to SOEs.
Biotech + regulatory change + “intellectual property rights(IPRS)”
Brazil and India
IPRs on biotech – Brazil and India
Science and education --- MNCs’ R&D investments in India, Brazil and China to access scientists

15. China example/puzzle

16. Future trends – indications from US VC investments
Fuglie 2016

17. Industrial policies that affect agricultural inputs
Quid pro Quo: technology for markets – foreign firms must provide technology and be minority owners
India and Brazil stop by 1990
China continues to have them
Consolidation of local industry
China - “Grasp the Large, Let Go of the Small” policies 1990s. Large SOEs buy small SOEs….
India - Large Indian companies and MNCs buy smaller firms
Brazil – MNCs bought local companies
Developing global champions for export and outward FDI
China – explicit in “Made in China 2025” policy
India – encouraging private companies through financing and subsidies

18. Developing global champions using state owned enterprises
Agricultural chemicals dominated by SOEs
ChemChina and SinoChem formed in early 2000s
Government finances acquisition of Syngenta by ChemChina
Talks to merge ChemChina and Sinochem
Seeds/biotech –
ChemChina purchase of Syngenta will create first modern Chinese seed company
China National Seed Group – owned by SinoChem, collaboration with Monsanto on maize, HuaZhong Ag University for rice.
Yuanlongping
Tractors
YTO – First Tractor
Foton – Lovol