FLORHAM PARK, NEW JERSEY, US — With global wheat supplies tightening due to climate change and the war between Russia and Ukraine, two of the world’s biggest wheat producers and exporters, finding ways to maximize wheat yields and produce seed that is resistance to drought and disease has never been more important.

That’s why BASF’s announcement on Feb. 28 that it would cease its activities in hybrid wheat seed development in North America was met with shock and disappointment by US and Canadian wheat growers and processors.

BASF Plant Science, a subsidiary of the Germany-based chemical company BASF, in recent years had been working to develop hybrid wheat seed in various parts of the world, including North America. But BASF last month said it would be cutting 2,600 jobs due to rising costs and weak earnings, including its North American hybrid wheat developers. However, it noted that it would continue its development programs in Europe and other countries.

In a letter to stakeholders, BASF said “despite the tremendous efforts of our team of experts, the results of our North American trials have not achieved the development goals we set to meet the needs of growers in Canada and the United States.”

Although it lagged China-based rival Syngenta in terms of getting the seed to market, BASF was seen a key player in the effort to develop hybrid wheat seed. The announcement caught BASF’s stakeholders and even its competitors off guard.

Jane DeMarchi, president of the North American Millers’ Association (NAMA), told World Grain that the unexpected news was disappointing to NAMA members “who welcome any investment in wheat research and variety development.”

“Hybrid wheat represents a technological breakthrough for wheat,” she said. “Potentially, it can offer higher yields and better stability and disease resistance, among other things. It is a complicated technology in the sense that creating this seed economically has been a barrier. It’s been tried several times in the US, but companies have struggled to figure out how to do it economically.”

DeMarchi added that those in the BASF hybrid program were “very active participants in the Wheat Quality Council in terms of giving the millers and growers an opportunity to preview and test their varieties.”

“That’s so important for the wheat value chain and we urge any private company investing in wheat development to participate in that testing program,” she said. “They were really doing all the right things. They had terrific people in their program, and I think everybody is sad for those folks.”

Steve Mercer, a spokesperson with US Wheat Associates, said national wheat organizations were aware of the BASF announcement and look forward to learning more from the company about the decision to stop hybrid wheat development work in the United States.

The good news for those in the wheat value chain is that Syngenta remains in the North America marketplace and is closer to having a commercially viable product than its competitors.

Paul Morano, head of North American cereals for Syngenta, told World Grain that the competition with BASF and other companies working to develop hybrid wheat varieties, such as Bayer and Corteva, helped drive the sector forward.

“It sounds ridiculous to say this, but we’d prefer someone else be in that market, too, because it gives you people you can bounce things off of and gives confidence to the market that this is a viable product. We believe strongly that it is," Morano said.

Although Syngenta is the clear leader in the race to develop and market a hybrid wheat seed in North America, Morano noted that producing a quality seed that is affordable for farmers and profitable for the seed company takes many years of trial and error and considerable patience. Syngenta has been working on developing hybrid wheat since 2010 and some of its researchers for much longer than that.

Syngenta last year launched its hybrid wheat product into the marketplace, making very small quantities of seed available through its dealers in the Dakotas and Minnesota. This year, about 5,000 acres of Syngenta hybrid spring wheat has been planted in that region, he said, and the plan is to expand the program on a much larger scale to the hard red winter wheat growers in the US Plains states, in the coming years.

Morano explained that hybrid wheat development involves “sterilizing” the female plants and then pollinating them using fertile male plants. This process allows breeders to choose the best traits from the male and female plants to produce a seed that compares favorably to conventional varieties, except for cost. It also is seen by some as a safer alternative to genetically modified wheat seed, which is also being experimented with as an alternative to conventional varieties.

But Morano, a former wheat farmer from eastern Kansas who has worked for Syngenta for 20 years, stressed that controlled cross-pollination is difficult to execute.

“When you have to rely on pollen floating through the air from another source to get 100% pollination, the timing of all those things make it extremely difficult,” he said. “That’s why it takes a while. Roundup Ready (genetically modified) soybeans took the market by storm in two years. This is not that type of product. It involves a much longer process.”

He said Syngenta’s success in the conventional wheat seed market in North America — it holds a 40% market share in conventional hard red spring wheat in the US Northern Plains and 30% market share of the hard red winter wheat market in the United States — has helped provide funding for its hybrid program.

Morano estimated that it might take 20 years to get to the point where 30% to 40% of the roughly 40 million acres of wheat in the United States are hybrid varieties. To achieve that goal, he said hybrid varieties will have to feature “minimally 10% to 12% better yield than conventional wheat” to make it cost-effective for the producer.

“We’re at the cusp of that,” he said. “We can make that. Hybrid wheat is very consistent in terms of yield. It doesn’t vary. When it gets stressed, it responds in a positive manner. Obviously to get to where we want to get to, we need to be competitive with other crops. We’re not going to go into central Iowa and take away corn and soybean acres. But you look at a place like North Dakota, which now grows a lot of soybeans and corn, can we be competitive on that acre on a rotational basis? We think we can.”

BASF said it plans to continue its hybrid wheat seed development program in Europe, where wheat is viewed as a higher value grain. Syngenta and Bayer also have development programs in that market.

Morano said Europe is a very attractive market for hybrid wheat developers because it is the predominant grain crop, used much more in animal feed than in the United States, and most of the wheat grown on the continent is higher-yielding soft wheat. In the United States, lower-yielding hard wheat is the dominant variety.

“It is the leading crop in Europe,” Morano said. “You don’t have to stand behind the corn and soybean guys over there (like in the United States). The wheat yields there are, for the most part, so much higher than in the US. The yields are much more like we see in the Pacific Northwest. They’re growing 100- to 150-bushel-per-acre wheat day in and day out.”

While hybrid wheat varieties are coveted by growers for their potential to produce consistently higher yields and their drought- and disease-resistant traits, those further down the wheat value chain, including millers and bakers, are most interested in wheat quality that allows them to produce superior flour and baked foods.

“We work with flour millers a lot,” he said. “We give them samples and do our own quality testing as we have for years on our conventional wheat. These hybrids coming out now have been through six or seven different types of quality testing every year. What we’re finding is that that quality of the end product hasn’t gone down at all, and we’ve seen little bits of improvement in quality.

“This is every bit as good as the conventional wheat varieties that are out there today. We have seen no dips in quality. There are no red-flag issues. They are saying it mills and bakes just like anything else we have on the market.”