The National Peanut Board has delayed for one year approving an agreement with research institutions that would restrict the sharing of commercial products – such as seed varieties developed with grower-funded research funds – with international competitors.

Meeting at its Atlanta headquarters on Feb. 5, NPB voted to postpone until January 2016 a clause to its research institution agreement prohibiting the licensing of technology outside the U.S. without consent from the board and the applicable state producer organization.

(Editor’s note: This is part one of an exclusive two-part series based on the National Peanut Board meeting held in Atlanta Feb. 5, where industry stakeholders discussed their concerns about the licensing of technology, particularly commercial peanut cultivars, outside the U.S.)

Representatives from the Southern Association of Agricultural Experiment Stations from a number of peanut-producing states attended the meeting along with state and national producer group leaders and other peanut industry stakeholders. Some endorsed the board’s proposal while others questioned its intent and urged caution with the specific wording contained in the agreement.

After listening to comments from those present, NPB met briefly in executive session and then unanimously agreed to postpone until next year a new research institution agreement provided participating universities agree not to enter into any new international licensing agreements for commercial peanut varieties before January 2016.

“This is a very important issue to our board, to the research universities, and to the industry,” said Bob Parker, president and CEO of NPB in opening the meeting. “Research is one of the most critical parts of our mission. More than $20 million has been invested in research by NPB since its inception, and more than $2 million is budgeted for research in the current fiscal year.

“We believe it’s in the best interest of peanut growers who help fund our programs, including research, to oppose licensing of technology – including commercial peanut cultivars, and I emphasize commercial peanut cultivars. Seed cultivars are the only technology farmers have that are unique to us that competing countries usually can’t buy in the marketplace. They can buy the same tractors, implements and GPS systems we use, along with chemicals and most other inputs,” said Parker.

The U.S. average peanut yield incredibly has increased by 33 percent over the last three years compared to 10 years ago, said Parker, and many in the industry never thought they’d see average yields exceed 4,000 pounds per acre. During the last three years – even with drought conditions in 2014 – U.S. peanut yields averaged more than 4,000 pounds per acre.

With increased production, however, come other challenges, said Parker.

“The 2014 crop is projected by USDA to be 2.6 million tons, so it’s 600,000 tons above the U.S. demand. Many people are predicting U.S. acreage will be up 15 percent or more in the U.S. this year. A 15-percent increase will put us over a 3-million-ton crop, using the 2014 yield, which was the lowest of the last three years.”

Peanuts, said Parker, are essential to the growers represented by NPB. “I had a farmer from Mississippi tell me one time that he was going broke growing cotton, and that peanuts saved his farm. Until the 2002 Farm Bill, peanuts were not as attractive an option because of the old quota system. Unless growers reduce peanut acreage, maintaining our competitive position in international markets is critical.”

NPB believes, he said, that “allowing competing countries access to commercial peanut varieties increases their competitive footing and displaces U.S. peanuts in the export market, which also is detrimental to U.S. growers.

“I want to make it clear – we do not oppose sharing our germplasm with scientists in other countries in the furtherance of research. We don’t oppose the use of grower-funded technology for humanitarian purposes under the right circumstances. In our research agreement, we have a provision that allows us and the appropriate state associations to agree to licensing in certain unique circumstances.”

The intent of NPB, he said, is not to stifle cooperation among scientists from around the world. “The National Peanut Board is funding $2 million in genomic research on behalf of peanut farmers in an international collaboration. I’ve been in the peanut business for 35 years, and I’m not naïve enough to think restricting or not licensing is going to stop the movement of varieties of peanuts to other countries. However, based on my experience in the peanut industry and in the seed business, I think it will slow it down through proper education and awareness. I believe international licensing will do long-term damage to our industry, allowing our technology to freely move to other countries is not in the best interest of U.S. peanut farmers.”

What's best thing for peanut industry?

Craig Nessler, director of Texas A&M AgriLife Research, requested that NPB keep current agreements in place until the issue could be discussed further, “and we can figure out the best thing to do for the peanut industry.”

“One of the things you may or may not know is that in most states – certainly in Texas – the IP or intellectual property is not owned by us. It’s owned by the Texas A&M system, which has a licensing office. For us to sign a document in which IP is limited or restricted is not possible without review and consent from that group. Also, the state of Texas has laws that require us to use that IP in a way that benefits the agency and the state of Texas,” he said.

Nessler said he appreciates that the licensing issue is a concern among growers. “It’s a lot like the immigration issue. The common sense response is to say we don’t want people coming into the U.S. We want to make sure that we have enough jobs for Americans that are here already. As producers, you know the U.S. agriculture system could collapse without a system for bringing guest workers into the country to serve the industry. We just don’t have the farm workers in the U.S. to do the job.”

Nessler said he was asking the board to “take a step back and say this common sense idea of not licensing things to our competitors sounds good on the surface, but it concerns us. One concern is there is no way currently to police the use of germplasm in other countries if someone doesn’t do it. Companies have the obligation and the resources to do the analysis and find out who is cheating. And believe me, companies like Monsanto with their protected traits are all over the world making sure people aren’t stealing their technologies.”

The germplasm, says Nessler, would be much more limited and regulated if it were licensed to a company.

“In Texas, we’ve had a $30 million cut during the recession, and the earmarks disappeared. One of the ways we’ve been able to recover from that is to make sure we had partnerships with corporate sponsors. We don’t sell things, but we work with companies to make sure that what we’ve done is protected, and what we’ve done is used in a responsible way, and the funding from that in royalties and research dollars can be used to advance Texas farmers and Texas interests.

"I would ask you to consider a delay of this decision and structure a committee to really look at the issue and make sure it works for everyone,” he said.