A research funding black hole left by the demise of the DEFRA LINK programme is central to a proposed 6p/t levy increase for cereals and 10p/t on oilseed crops by HGCA.

Currently the HGCA receives around £9.8m a year in levies from cereals and oilseeds growers, processors and dealers in the UK. Growers contribute £8.4m from a levy of 40p/t on cereals and 65p/t for oilseeds.

That funding has contributed to a £17m investment by HGCA into research projects over the three-year lifetime of the current R&D strategy, which ends this year, says Susannah Bolton, head of R&D and knowledge transfer for HGCA. Typically over 50% of the levy a year goes into research, including the Recommended Lists and knowledge transfer activities.

To that cash investment, around £20m of government funding primarily through the LINK programme, but also through BBSRC and grants from the devolved administrations, has been added.

That enabled the board to effectively extend the research programme and deliver more for levy-payers, Dr Bolton says. “HGCA has been very successful at using levy money to leverage extra resources, especially from DEFRA.”

But DEFRA’s decision to close the LINK scheme through which a lot of the extra funding was obtained has left HGCA with a huge research fund deficit. Currently 75 of HGCA’s 120 managed projects receive LINK funding.

Some of that government research funding has effectively been switched into Technology Strategy Board projects, with around £13m committed in the direction of arable research in a recent round of project awards.

But TSB money is harder for HGCA to obtain because, as a public body, it has to make all the findings public, while TSB research can be used to deliver a commercial benefit to businesses that apply. “And so those companies don’t want the research to be made public, and so are less keen for HGCA to be involved.”

The loss of the LINK programme, and the unlikelihood of securing equivalent funding through other sources, has made it crucial for the HGCA to develop a new strategy for engaging with research and delivering the results to levy payers, Dr Bolton says.

Analysis made during the body’s R&D strategy review this summer made it clear that the ability to attract DEFRA funding, welcome though it was, actually muddied the water.

“It led to projects where it was easier to get DEFRA money,” she admits. “Not being able to attract that funding gives us the opportunity to re-focus on what research to do.”

The strategy review identified areas, such as soil and weed management, for example, where research was relatively lacking, but were highlighted by growers as areas of real importance.

Both areas will attract new research in the next round of projects, Dr Bolton says. “We recognise the critical situation for managing weeds with the combined effects of herbicide resistance, loss of actives already and through impending legislation, and changes in cultivations.

“If we’re going to use herbicides to maximum benefit we have to think of using cultural controls, so a new project will attempt to quantify their impact more precisely, especially ones making the most of competitive ability of the crop.”

Projects across the AHDB sectors, but particularly with the Potato Council, will look at soil quality across the rotation.

Importantly the strategy review has also highlighted that too often the outputs of research projects have failed to be taken up in practice on farm.

“For example, we have carried out 16 research projects relating to the feed industry in 10 years, investing £2.7m of £15m in total cost, and actually relatively little has come out, and it is a knowledge transfer problem rather than the quality of the research.

“Our role has to be that levypayers see the benefits from the research, so it has meant a rethink in how we commission research and how we operate as a communications team to get that research out.”

The most obvious change will be for HGCA’s research managers to now also take on the role of knowledge transfer. Each of the six research managers will have responsibility for a key area, such as crop nutrition, crop protection or food and feed quality.

“We are focused on getting experience in the team to understand what the demands of the industry are, and to have a pretty good idea of how the output of any research will benefit the levypayer before we commission the research,” Dr Bolton says.

Recommended Lists

Nearly every levypayer uses the Recommended Lists, which cost HGCA £1.3m annually, the research review unsurprisingly found.

But, it too, must evolve, Dr Bolton stresses. “We think it could provide even more value by integrating it more fully with the crop protection and agronomy research.”

For example, RL data and trials could help with understanding the disease interactions with variety and fungicides. “We’ve created a new research/knowledge transfer post for agronomy which will be closely associated with the RL team.”

Grain price

Levy rises are unconnected with the rise in grain prices, Jonathan Tipples, HGCA’s chairman, stresses.

“On the one hand we are perhaps fortunate that the grain price has risen, but with the government cutbacks we would be having this discussion if the grain price was £90/t.

“And, of course, we can’t make up the shortfall just by raising the levy – that would mean putting pounds on it – so it means we have to do cleverer things.”

As well as identifying key research areas, and transferring knowledge gained more effectively, that will also mean making better use of research already undertaken, retaining at least the same level of BBSRC funding, and exploring the possibility of working more closely with the research council, says Dr Bolton.

There is also a need to be tuned into alternative sources of research both in the UK and internationally, she says. “So we can tap into that knowledge and provide an independent evidence base in those areas.”

Grower reaction

“There is an old saying that you should cut your coat according to your cloth. Cereal prices may be high this year but that will not last and we will find that these levies will be a disproportionate amount of money to take off. It sounds small, but levies only seem to go in one direction. We should ask for a 6p /t decrease.”

“I think HGCA do us far more good than most of us will ever realize. Also with the cereal price rises we have seen recently and in light of the loss of the DEFRA-funded LINK scheme, I think it entirely acceptable that we should support HGCA more. I am therefore not opposed to the levy increase that is proposed.

“Even though in real terms the value of our grain prices that we have received since 1997 until recently has also diminished, we cannot afford to lose the excellent work that HGCA does for us and on our behalf.”

Why HGCA says the levy has to go up

1) Loss of DEFRA-funded LINK research programme has left a £17m hole in research programme funds

2) Levy has lost value (33%) since 1997, the last time it was increased.

3) HGCA has already cut staff numbers and costs as part of co-location with AHDB.

What HGCA will do with the extra £1.5m raised

1) Spend 85% on research, including R&D projects on agronomy to maximise technical efficiency/identify ways to increase volume and value of UK cereals in animal feed/develop appropriate GHG and carbon reduction programmes to mitigate against cost of legislative requirements.

2) Spend 5% on raising grower performance through business groups benchmarking and regional market intelligence statistics

3) Spend 10% on regional communications to focus on specialist markets, and ensuring strong links between business improvement benefits of current and future technical activity developments.

Levy consultation

AHDB is consulting the industry on its 2011-14 Corporate Plan to 6 January 2011. You can find relevant information at the following web links:

http://www.ahdb.org.uk/publications/consultation.aspx

http://www.hgca.com/levy/

Responses should be emailed to info@ahdb.org.uk or posted for the attention of Guy Attenborough, AHDB, Stoneleigh Park, Kenilworth, Warwickshire, CV8 2TL