35 



As a for instance, a year ago K-State released Karl 92. Morris 

 County, my home county, received seven bushel. I propagated it 

 last year, again this year. If all goes well, I expect to have roughly 

 1,000 bushels to provide to my farmer seed customers. 



I am also an AgriPro associate and follow a similar procedure, 

 but pay a royalty usually $1 to $1.50 on each 50-pound unit sold 

 which goes back to AgriPro for their research programs. I under- 

 stand from them that it takes about 10 years and about $1 million 

 to produce a new cultivar. 



On the surface, the PVPA system looks good. It is not working, 

 though, because of widespread disregard for the rules and regula- 

 tions. 



For instance, Pioneer built a good reputation in grain sorghum 

 and corn, then decided to enter tne wheat seed business. They built 

 a state-of-the-art research facility at Hutchinson, Kansas, and from 

 there they started to market wheat seed through their dealers, 

 hoping for a good return on their investment. 



They released some excellent varieties, but it didn't work out be- 

 cause farmers would buy a few bushels, raise a crop, and then sell 

 seed illegally to their neighbors. Even some of their trusted Pioneer 

 dealers got into the act, selling out of two bins. Pioneer finally real- 

 ized what was happening and closed their research facility at a 

 considerable loss to everyone involved — and by everyone involved I 

 mean seed dealers and farmers. 



AgriPro observes that about 30 percent of Kansas wheat is plant- 

 ed to their varieties, yet they only collect royalties on about 5 per- 

 cent. Think what they could do with a sixfold increase in research 

 money. 



For instance, they release usually one new variety each year. If 

 they had the money coming back from the royalties on the seed 

 that is sold under the AgriPro banner — or I should say used under 

 the AgriPro banner — they could be releasing perhaps as many as 

 six new varieties each fall. 



As a seedsman, I have farmer customers brag to me that they 

 made good money illegally by selling their production which came 

 from seed they purchased from me the year before. You may ask, 

 why do I sell to them? If I don't, they would buy from somebody 

 else. 



The consequences to me as a seedsman can be serious. If I start 

 with a $3 bushel of wheat, it costs about another $3 to make it into 

 a bag of wheat seed. I add about $1 of profit and expect to sell it 

 for $7. 



If my neighbors saturate the market illegally, I have to dump the 

 bags, and my certified seed becomes just grain going to the eleva- 

 tor. I lose my profit, and I have to liquidate my certification ex- 

 pense against the value of the grain. In other words, $3 minus $3 

 leaves me with nothing. 



Now this really doesn't happen because I know better than to 

 overproduce. I have loyal customers who will buy from me knowing 

 the value of certified seed. But if I dump, shall we say, just 100 

 bags, I have to sell 600 or 700 more just to get back to the break- 

 even point. 



As a farmer, I can't do much to increase production by increasing 

 rainfall, and in my area there is very little irrigation so that is a 



