8 I EUROPEAN SEED I EUROPEAN-SEED.COM that plant breeding and seeds will be pivotal to both UK and EU legislators and it will be our task to speak up and communicate to get these topics to the forefront of policy thinking. So, how does a plant breeding and seed business plan amongst all this uncertainty? There are key areas where our lives are at risk of becoming much more complex and difficult. Ultimately, most barriers can be overcome by businesses by adapting their processes and structures. However, barriers by their nature add costs and never add sustainable value. These costs will eventually hit prices of seeds on farm, and if the level of access to capital by the breeding and seeds companies is to remain stable and sustainable for a company’s long term future, any additional cost burden at our part of the supply chain risks proportionate disinvestment. Consolidation of large multina- tional companies and lack of start-up entrepreneurial activity in seeds is a strong indicator that there is a continual drive for synergy and cost efficiency to survive as a business in our sector. Big business is certainly not metaphor for bad business, however, a healthy entrepreneurial sector should always contain a diver- sity of businesses and so if the development of trade barriers is a result of Brexit, then this cannot be helpful to maintain space for small and medium sized businesses. in hectares compared to other countries; for example France is roughly four times as large for cereal seeds alone. However, the UK is valuable thanks to professional farmers and value chain with high degree of respect for intellectual property, including farm saved seed. Therefore, it is most likely that it will remain attractive even if faced with volatile currency movements, as internationally active companies have both costs and income in the UK, so have some buffering against GBP currency move- ments. Again, stakeholders and customers value having addi- tional customer choice and the continued benefit of breeding innovation, so here is another cause for optimism that we are maybe not likely to suffer a disaster scenario. Are tax regimes important? Yes, but R&D led businesses who also engage in seed production and distribution rarely build their business model or choose location primarily for tax rea- sons. The tax considerations are secondary and may influence the scale of activity so regimes like ‘patent box’ and R&D credits are highly valued to maintain scale in the UK. What does change is that the new scenario limits us to looking at the UK market separately in its own right and it can no longer be considered as a suitable platform location for EU market access. Our task is to minimise harm from Brexit, and look for every opportunity to add value to UK customers using resource and expertise, taking account of the changing operating envi- ronment. We are of course not alone, and this is typical of the agricultural supply sector, which is largely composed of fully internationally integrated companies operating across borders. The governments need to understand that this structure is not a typical bilateral trade relationship between unrelated compa- nies that they will encounter in many trade related discussions. As entrepreneurial businesses, we will find a way. Willing buyers and willing sellers make markets and basic economics means that valuable seeds and varieties will reach the markets mediated by price and customer value added. So, tax rates, tar- iffs, and regulatory cost burdens in the end affect the price of seeds. The message to governments on both sides of the nego- tiation is that breeders and seed companies do not make high profits so adding only a small amount of cost can have a dispro- portionate effect with long term impacts on UK agriculture and rural environment. What do we do? We need to inform the negotiators on both sides of these special considerations. To influence the Great Repeal Bill to take account of our needs we need to communi- cate strongly with the UK government, explain the vision of a global Britain relevant to the international seeds market and adding value to the UK agricultural economy by attracting R&D investment from the EU and access to seed varieties. We must explain the importance of encouraging EU companies to directly engage in the UK economy by continuing to locate subsidiary companies in the UK and to optimise the opportunities for UK headquartered companies to export to the EU. This is a big task and we must act and communicate on every level. As individual companies as well as through our national seed associations and the European Seed Association to get our voices heard. In our businesses we need to keep our strategic radar ‘tuned’ to pick up the signals of changing market through what will be a fast moving and potentially confusing political process. When those signals appear we need to be ready to adapt our business in good time. That way we can remain competitive and profita- ble supplying added value to UK farmers. At a societal level we consequently can continue to make our significant contribution towards the need of sustainable agriculture through producing ‘more from less’ using the genetic diversity developed in our breeding and innovation development processes. This cannot be delivered in the absence of a properly functioning seeds market to which Brexit is a significant event and our political represent- atives need to treat it with care. There are key areas where we have risks of disruption to current activity: •  Differential seed quality/seed treatment standards dis- rupting cross border trade •  Common catalogue of varieties recognition in the UK and UK registration not recognised in EU •  Public research funding and excellence may shift away from UK institutions •  Hard Brexit results in World Trade Organisation (WTO) tariffs at UK/EU border. For example the EU currently levies an import tariff of €95/T on wheat seed for sowing from third countries. It is important not to overreact or act too hastily when so much is unknown. However, when there are strong signals that market conditions are about to change, then the business approach also needs to change to adapt to it and optimise the business case. Only if we reach critical conditions in terms of price/value and regulatory complexity would business invest- ment withdraw from the UK and the signals today suggest that this is extremely unlikely. So, for all businesses, agility and rapid decision making to be able to adapt are essential. However, for a seed company with long term R&D lead times for developing new varieties that is indeed a challenge and if we leave a market or withdraw, it is typically decades before it is possible to re-es- tablish activity. In a strategic context relative to R&D development costs, the UK markets for field crops in particular are relatively small Nigel Moore has been the president of the European Seed Association board since 2015. He is currently the head of Business Administration for KWS SAAT SE Cereals.