New costing tool helps sharpen crop breeding investments

Maize breeders visit a KALRO research station in Kiboko, Kenya (Source: KALRO) 

 

Traditionally, many public national breeding programs have not prioritized the costing of their operations. But as the pressure for a higher return on investment increases, costing has become critical for allocating resources within breeding pipelines, identifying significant costs, and building investment cases.

By using a new costing tool, CGIAR and its National Agricultural Research and Extension Systems (NARES) partners are starting to get the better financial data needed to optimize their programs. This will ultimately mean higher genetic gain per dollar invested. 

A new open access “Breeding Costing Tool,” developed by the University of Queensland (UQ), is currently being piloted by the CGIAR Excellence in Breeding (EiB) and the International Maize and Wheat Improvement Center (CIMMYT) in collaboration with various NARES.  

The software provides an affordable, user-friendly means of analyzing the costs of breeding operations. It also offers greater transparency by providing an accurate and realistic cost structure and analyzes key components of various breeding pipelines.  

CIMMYT’s Global Maize Program Director B.M Prasanna, observes that “breeders, in both private and public sector institutions, invariantly face demands beyond current resources — the emergence of a new disease, pest or a new plant demand trait  therefore, we need to assess the most efficient ways to manage resources at our disposal.”  

To increase the impact of CGIAR as a multi-crop breeding organization, the tool helps breeders understand the relative costs of breeding a crop in different regions and using appropriate technologiesThis will also contribute to success in the Accelerating Genetic Gains in Maize and Wheat for Improved Livelihoods (AGG) Project, whose vision is to collaboratively generate rates of genetic gain of 1.5% per annum. 

EiB Director Michael Quinn notes the importance of analyzing costs of breeding programs to increase the rate of genetic gain per dollar invested, thereby optimizing breeding pipelines.  

“As the One CGIAR moves towards shared services and centralized operations as a single, multi-crop breeding organization, it will require an understanding of costs. [This tool] enables the establishment of business units that can operate as service units and be fully funded on a cost-recovery basis,” says Quinn. 

 

How does the breeding costing tool differ from other budgeting tools?  

The breeding costing tool serves three main functions. First, the tool estimates the costs of a current breeding pipeline and identifies the most expensive components. Second, the tool can be modified to scale different elements of current breeding pipelines in an interactive way that allows breeders to draw ‘what-if scenarios’ and various consequences of changing elements in the breeding pipeline. The third function is the ability to compare costs of alternative breeding pipelines, for example, conventional line development vis-a-vis doubled-haploid line development. The comparability can also be extended to assess the impact of introducing new technologies, such as mechanization.  

“Costing of breeding programs has not traditionally been a priority in public national programs but it is a critical component to better allocate resources within breeding pipelines, identify high-cost centers and build investment cases,” explains EiB NARES Coordinator, Biswanath Das. 

Breeders can have a better understanding of the financial impact of changes they make to the pipeline by looking at different costing models of the different variants of the pipeline. When a budget should be reduced, for example, breeders can model different scenarios or develop a business case to support the procurement of an item. 

 

Finding efficiencies in NARES programs 

“We can also use this tool to rationalize our work,” explained Busiso Olga Mavankeni, from Zimbabwe’s  Department of Research and Specialist Services  (DR&SS) in a Story of Excellence session at EiB’s Virtual Meeting 2021. “For example, in one of the programs…data collection on clearing was a huge cost, so we can rationalize [these] costs by carrying out data collection on [a] few stations for highly irritable trades.”  

The breeding costing tool is currently being deployed by EiB at five NARES cereal and legume plant breeding programs in Africa. EiB is developing a strategy to scale support for NARES programs in 2022/23 through building internal capacity at each NARES institute.  

Prior to the introduction of costing software, national partners such as Kenya Agricultural and Livestock Research Organization  (KALRO) and Ethiopian Institute for Agricultural Research (EIAR) experienced several challenges related to costing of breeding activities. These include limited knowledge about the costs of activities and products, or a lack of metrics on genetic gain relating to dollar spent. Most budgets were based on mere estimates without a tool to calculate actual costs.  

 

 

Ethiopian Institute for Agricultural Research (EIAR) costs out activities using the Breeding Costing Tool (Source: EIAR in EiB/AGG Webinar) 

 

But now EIAR has used the software in its maize, sorghum, wheat, chickpea and common bean breeding programs. Likewise, KALRO’s maize breeding program ran its first full costing in 2020. They discovered that guarding crops from animals, cold seed storage, and gathering flowering data were three of the highest costs. Now KALRO is working to implement a range of strategies to cut these costs.

 

Practical application…  

At a webinar jointly hosted by AGG and EiB, sorghum molecular breeder, UQ’s Emma Mace along with colleagues, David Rodgers and David Jordan took participants through the components of the costing tool. By inputting the project components that define the scale of the project such as land area, rows per plot, dimensions of the field trial, and lab activities, breeding teams can determine the specific unit costs and fixed costs of planned activities. This allows them to draw scenarios that show points at which breeding pipelines are efficient, expensive or adjustable.  

Syngenta’s Olivier Cottet also explained how costing a breeding program helps anticipate market trends and evaluate market sizes and shares. In this way, companies can determine priority areas for resource allocation in the short, medium and long term. At the same time, breeding resources can be aligned with the most competitive business market segment 

Overall, the breeding costing tool helps breeders monitor costs per unit, curb overruns in budgets, identify areas of continuous improvement in the breeding pipeline, and maximize the return per dollar invested in breeding operations. This is helping CGIAR and NARES partners increase genetic gain in a cost-effective way — while ensuring the financial sustainability breeding programs need.   

 

Resources: 

  • Full webinar on the costing of breeding programs can be accessed here.   
  •  Presentation on “Costing of breeding programs: Results and perspectives from NARES Rice Programs” can be accessed here. 

  •  UQ Breeding Costing Tool can be accessed here. 

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    Story by Shiela Chikulo, CIMMYT Communications Specialist, with support from Bish Das, EiB NARES Coordinator and Adam Hunt, EiB Communications Lead. This story reflects the information and views of the authors or quoted individuals only. EiB and partners are supported by CGIAR Trust Fund Contributors and the Crops to End Hunger initiative, via GIZ, BMZ, Bill and Melinda Gates Foundation, USAID, UK Aid, ACIAR and other partners. 

     

    EiB and CIMMYT also thank:

     
    • The University of Queensland Australia 

    • Ethiopian Institute of Agricultural Research (EIAR) 

    • University of Ethiopia 

    • Syngenta Foundation for Sustainable Agriculture  

    • Foundation for Food and Agricultural Research (FFAR) 

    • Accelerating Genetic Gains in Maize and Wheat (AGG) 

    • CtEH-HiRice (Crops to End Hunger)