Co-evolution of horticultural breeding and product value chains – a Product Cycle Perspective
Imagine all the steps involved in getting fruits and vegetables from the farm to your plate: figuring out how to breed better ones, creating those seeds, multiplying them, getting them to wholesalers and stores, and finally to millions of people around the world. This whole process is like the invisible building blocks that keep our food system healthy and growing.
The talk focused on how changes in horticulture breeding had "co-evolved" with the expansion and changing operations of horticultural value chains. Transformative changes took place around the world in recent decades, following a typical “Product Cycle” process. The seminar explored the practical implications of these dynamic changes along horticulture value chains for policies and future development of horticulture in low- and middle-income countries and high-income countries.
The first phase of the “Product Cycle” was “commoditization,” where fruit and vegetable supplies shifted from local niche markets to broad-based commodity markets to meet the rapidly growing demand in cities as well as increased demand from low-income households as their diets changed with income growth. In the commoditization phase, the development of horticultural breeding value chains was often helped by government support and focused on agronomic traits for wide diffusion. Public investments in Research & Development & Engineering were crucial in this stage. The second phase of the cycle consisted of “product differentiation,” involving a shift from horticultural products perceived as “uniform” commodities to differentiated products distinguished by quality traits, such as taste, size, and appearance. These traits became central to the marketing strategies of suppliers and wholesale and retail traders catering mostly to the growing middle classes.
Product differentiation mattered significantly to farmers and their income opportunities. In this differentiation phase, changes in the horticultural breeding value chains were driven by private sector initiatives and became increasingly globalized, involving major innovations in technology and industrial organization. These innovations altered the vertical integration of value chains and the partnerships between upstream actors and downstream retailers and grower-shippers. Intellectual proprietary rights associated with breeding different food varieties became an issue in defining production and market access.
The talk was based on the paper co-authored by Tom Reardon, David Zilberman (UC Berkeley), Karina Gallardo (Washington State University), Rob Vos and Jo Swinnen (IFPRI), and Carl Pray (Rutgers).
Speaker: Thomas Reardon, Professor, Michigan State University and Non-resident Senior Research Fellow, IFPRI
Discussant: Carl E. Pray, Distinguished Professor of Agricultural, Food and Resource Economics, School of Environmental and Biological Sciences, Rutgers, the State University of New Jersey
Moderator: Rob Vos, Director, MTI, IFPRI and Lead – Rethinking Markets Initiative