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Agricultural Pesticides in China

Bharat Book Bureau | Wednesday 25 July 2012 ( 0 Comment)

Demand for formulated pesticides in the agricultural market in China is forecast to rise 5.3 percent per annum to 2.3 million metric tons in 2015. In value terms, formulated pesticide demand is expected to rise 7.1 percent per year to ¥60 billion. Market gains will be primarily driven by increases in agricultural production as measured by the total area of sown land, and ongoing expansions in the production of fruits and vegetables, which are by far the most intensive users of pesticides relative to most other crops. Improvements in pesticide variety and quality, especially those that result from a domestic industry that is becoming technically more proficient, will stimulate additional pesticide usage and further contribute to demand growth.

Farmers will continue to see steadily increasing income, the result of rising crop prices and government subsidies designed to supplement their revenues and reduce their material costs. Subsidies aimed directly at cutting the cost of pesticides will encourage additional use. Furthermore, increased pesticide usage has become more feasible from an investment standpoint, as use of additional pesticides can greatly increase crop yield, which in turn bolsters farmers’ income. The improved revenues attributable to higher crop prices more than compensate for the cost of the pesticides. 
The outlook for the Chinese formulated pesticide industry remains good. Shipments are expected to grow 5.2 percent annually and net exports are forecast to rise to 717,000 metric tons, due to the competitive price of domestic products and improvements in their quality. 
Insecticides to remain largest market, fungicides to grow fastest 
Insecticides will remain the largest product type through 2015 despite a relatively slow growth rate of 3.7 percent per year. Established products will continue to dominate the market going forward while the trend toward using less-toxic insecticides will contribute to the slow rate of growth. Herbicides will see strong growth in both shipments and demand through 2015, driven by a decrease in farming manpower and growth in export markets. Fungicides will post the fastest growth as farmers contend with resilient fungal problems.
Pesticide active ingredient sales will advance 4.8 percent annually through 2015 to 765,000 metric tons. By weight, active ingredients comprised 26 percent of formulated pesticide shipments in 2010. Growth will be stimulated mainly by increasing exports of pesticide active ingredients, while heightened domestic production of formulated pesticides will further boost demand.  Company Information
Northwest to be fastest growing regional market
The size, growth and composition of pesticide demand in China’s six regions vary considerably. The Central-East and Central-South will remain the two largest regional pesticide markets, together accounting for 70 percent of total demand in 2015. Demand in these regions will be driven by increasing output of high value crops. Growth in sales of pesticides in the Northwest will outpace that of other regions through 2015, benefiting from the Great Western Development Strategy. 
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