Beijing biotech firm banks on GM corn in order to be China's Monsanto Workers plant corn seeds on the fields in a village on the outskirts of Wuwei.
The commercialization of GM corn in the world's No. The 2 producer is going to increase yields, reducing the need for imports. Industry experts say that it could spur a new multibillion dollar market that may eventually open up to global seed giants because it could spur the reform of a chaotic and oversupplied seed sector.
The new regulations drafted last month laid out the steps needed in China for approval of corn varieties that include GM traits, paving the way for the market to open as early as next year.
Beijing will champion home-grown leaders in seed technology, and Dabeinong is the larger of two local companies with an insect-resistant and herbicide-tolerant corn already approved by the agriculture ministry.
For the first two years, because we're the first mover in the market, and we believe our technology is better, we'll have two thirds of the share, General Manager Liu Shi told Reuters.
He estimates that it could generate around 1 billion yuan $155 million in royalties by the third year. The company will rely on seed breeders to generate revenues.
In 2011, Dabeinong Biotechnology was founded as a unit of a large animal feed producer, Beijing Dabeinong Technology Group Co. Ltd.
A senior executive was accused of stealing corn seed from fields in Iowa and Illinois after making headlines in the United States. The executive, the brother-in- law of group founder Shao Genhuo, was jailed in 2016 for three years.
Liu, who joined the company earlier this year, said Dabeinong strictly abides by the law and is trying to rebuild its image. Dabeinong, with a staff of 160, hopes to emulate the success of the U.S. seed giant, but above all wants to help farmers, Liu said.
Dabeinong's corn traits use genes that have been discovered and commercialised by other firms but are off-patent. The biotech firm is working on its own genes, although these are yet to be approved.
An executive at a multinational seed company who declined to be named said it may need to move quickly before its me-too products lose value.
In September, Dabeinong has hired more commercial staff and invited seed companies to visit trial plots in Inner Mongolia and Henan province planted with corn containing its Fengmai brand traits to ensure its first-mover advantage.
It has licensing deals with more than 200 seed firms.
Early demand is likely to be strong.
China harvested 261 million tons of corn in 2020 21 from 41 million hectares, mainly to feed its huge herds of pigs and chickens. Each hectare yielded only about 60% as much corn on average as in No. Over the last five years, average corn yields in the world's top producers have gone up - https: graphics.reuters. com CHINA-GMO DABEINONG zdpxonlgrvx chart.png
According to an October article in the China Seed Industry Journal, 70% of the corn seed sold in China's northeast breadbasket is illegally bred GM seed.
Global seed giants like U.S.-based Corteva Inc. and Bayer can't enter China's GM market, Syngenta, the world's No. According to the prospectus for its IPO, 3 seed producer owned by China's Sinochem Holdings is expected to be the leader in the market.
Syngenta is a major player in GM grains but is still playing catchup in China in the run-out process to win biosafety certificates for its GM traits from regulators, as it was only bought in 2017.
Hangzhou Ruifeng Biotechnology, a tiny firm founded by Shen Zhicheng, has an insect-resistant, herbicide-tolerant trait approved by Beijing. Some new genes are used by the company.
Yuan Longping High-tech Agriculture Co Ltd, backed by state-owned conglomerate CITIC, is developing GM traits.
The exact timing of GM corn is not known.
Under the new rules, seed varieties that integrate GM traits must undergo a one-year production trial, and it is not clear if Beijing will accept data already collected by Dabeinong.
Liu said there are two plans, one for commercial seed production in 2022 and another for 2023. We're waiting for the message from the government.