DLF Seeds & Science: Green growth from seed to sprout

This interview with Truels Damsgaard, CEO, DLF Seeds & Science, was originally published in Country Reports. Truels Damsgaard outlines his company’s successful growth strategy and highlights the significance of digital technology and biotechnology in creating a more sustainable future.
 

How competitive is Denmark’s seed and food sector?

It all begins with the seed. Without seeds, you cannot get growth. Seeds are essential to the food industry, whether we are referring to Denmark or global markets. Growth opportunities in the industry stem from a growing population and new uses of plant products. One of the key characteristics of Danish seed and farming production is our strong cooperation and knowledge sharing between universities, authorities, industry and farmers. We are unique in that the whole chain works together to solve challenges. This keeps us at the forefront of developing solutions and implementing new technology. It is one of the reasons seed and food industries are so successful in Denmark.

Can you give us an overview of DLF Seeds & Science’s operations?

We are the fastest growing firm among leading global seed companies and are now the seventh largest seed company in the world. Over the last 10 years we have had an average annual growth rate of more than 10 percent. This is driven partly by acquisitions; we have been quite aggressive in broadening our footprint. We have grown organically by three to four percent annually. 20 years ago, we were a small seed company. We are proud to have grown from a relatively small player to one of the leading seed companies in the world. Becoming a global leader has made us a more robust company. We are no longer only dependent on Danish or European economies and supply and demand.

Today, we are the global leader in forage and turf seed in Europe, North America, Oceania and South America. We are the world leader for temperate crops. We have a very strong position in Europe. We serve about half of the European market with our core crops. Although we are in the top five in North America, we still have many opportunities for growth in this market. Since we work with temperate crops and are not in the tropical and subtropical arenas, we see growth opportunities for us to enter these markets. The center of that market is in South America, and additional market opportunities exist in Asia.

DLF stands for innovation and entrepreneurship. We want to boost the innovative part of our business to expand our research and development and continue our expansion. Our products are opening the markets to us. They need to perform under different climatic conditions. One needs different products depending on what area of the world one is growing in. Continued investment in plant breeding will stay high on our agenda. Future targets rest on our growth ambitions and continuing to grow faster than our peers. Our sustained ability to take advantage of scale is what makes us competitive.

What has the company done to overcome challenges caused by the COVID-19 pandemic?

Food production was not significantly impacted by the pandemic. People still needed to eat, and thus food production remained stable. The forage side of our business was also not heavily affected. In fact, prices have been rising. In the turf sector, our sales were boosted because people were staying at home and looking after their gardens. The supply chain is a challenge due to varying demand patterns that changed due to the pandemic, access to transportation, cost of transportation, cost of packaging and cost of energy. These challenges have put pressure on the value chain. We need to optimize, but we have also had to pass on price increases to make sure we remain healthy throughout this situation.
We have a staff of over 2,000, spread out over more than 20 countries. As a result, we were used to traveling all the time and visiting each other. Lately, that has not been possible. To keep morale up and maintain growth continuity, we have worked closely with all colleagues around the world to assess our core values. We needed a project to unite us in this difficult time. People are not used to working remotely among their families, which can be quite stressful for everyone. We thought it would be helpful to talk about our values, especially because we have brought together many new colleagues in the last five to seven years. It was a valuable process with people from all over the world talking about what unites us at this company in team meetings. In the end, we identified eight or ten potential values. We then ran an employee survey asking everyone what they thought were the most important values in DLF. They came down to the following four: innovation and entrepreneurship, global synergies, environmental sustainability and empowerment.

What new technologies is the company employing to make operations more efficient?

New technologies support the industry in becoming more efficient, delivering higher yields and improving quality, while at the same time allowing the sector to become more climate and environmentally friendly. Plant breeding takes many years. You need to be patient and invest money for a long time before reaping rewards. Conventional plant breeding uses processes that have been around for the last hundred years. Now, there are biotechnological tools that are faster and extremely efficient. Some are not allowed to be used in Europe, while others are. Biotechnology is going to provide better solutions for plant breeding going forward.

We have the opportunity to gain more experience by handling big data better. This is embedded in our research. We benefit by having immediate access to rich data, more than in any other activity that we engage in. When it comes to plant breeding, research and development and big data can ensure we speed up breeding gains. By using data efficiently, we can breed plants at one third the pace. Conventional plant breeding is more of a lottery; it is very much a numbers game. However, if you have access to data results of the processes you used—and we have recorded millions of data points—you can now predict the results you will have in the future more accurately. Genomic selection is a powerful new technology that we use in our breeding programs today. The technology uses data from historic results of our plant breeding combined with new knowledge on genetic profiles of our breeding material. With huge processing power and tailor-made algorithms, we can now pick out the best plants with much higher precision. This tool helps us deliver more by choice than by chance. We have been investing in genomic selection for almost 10 years, and we are now seeing that our plant breeding gains are larger, faster and more precise.

Robotics is also playing a larger and larger role in our processes. Access to manual labor is becoming a challenge; labor in the western world is relatively expensive. There are also very heavy jobs that we do at times, and robotics plays a crucial role. We are also more efficient in the fields by using drones. We can quickly and efficiently oversee what new plants look like and their performance. Images from drones combined with big data provide us with detailed and faster breeding gains.  Robotics has been included in our investment strategy for some time and will become even more central to our plans and help us remain competitive in the coming years.

What efforts has DLF Seeds & Science made to support sustainability and lower carbon emissions?

The new targets for low greenhouse gas emissions that Denmark announced are highly ambitious. Denmark is a first mover on this because we are always ready to test something new. We want to be green, but one cannot be green when one is in the red. We need to find a way for it to be profitable. Productivity needs to continue at the same time, which is a huge challenge. Our industry does not consume abundant amounts of energy. We produce seeds and the quantities are relatively low. Our biggest climatic challenge is managing to produce protein locally. Denmark imports massive amounts of soy protein to feed animals, mainly from South America and China. If we can replace a share of this with locally produced proteins, we can make a significant contribution to sustainability. We are one of the main shareholders in producing and refining a very sustainable protein from forage crops such as grasses and legumes. We believe we can produce financially competitive protein in Denmark to replace some of the imported protein from overseas. It will benefit us by raising the sustainability of Danish farming and saving us money; it is an excellent development for everyone.

Most of our crops are perennials. If you use grasses or legumes as a forage source, then you have perennial crops with a long root system in the ground that will stay in the ground for several years. Therefore, carbon sequestration of our crops is much higher than that of annual crops that one needs to plow and resow every year. When you are using the forages we are selling, you have considerably higher carbon sequestration, lower need for fertilizers because the legumes produce their own nitrogen and minimize nitrate leaching. There is indeed a powerful presence of sustainable farming in our practices.

How closely does the company work with universities in its research and development activities?

We work quite closely with them. We are close with Danish universities. We are also involved in projects with European universities and universities outside of Europe. Collaboration with these institutions is extremely important to ensure we stay at the forefront of what we do. For example, together with other breeding companies in Denmark and universities, we established a state-of-the-art root screening facility where we can study plants above the ground and what is happening below the soil. Root mass and length are directly correlative to the growth of the plant. The idea is to select plants with longer roots to be more drought tolerant in different climatic developments. Plants with larger root mass will also play an important role in climate change mitigation as they are more efficient in sequestering carbon in the soil. The environment is going to change, and we need to know our place in the greener world of the future.