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Issue 546 > Contents > At a glance > Subscribe



July 2008 > Contents > Subscribe

Agrow Reports

World Crop Protection Markets - DS247
Published 16 December 2004

Reports 2004

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CHAPTER 1 - INTRODUCTION

1.1 Agrochemical markets

The global agrochemical market has been depressed for the past five years. In 2003, it rose in dollar terms, but dipped in real terms, due to the weak US currency. Estimates put the market at around $26,635 million at distributor level (+5.9% – Phillips McDougall) to $29,390 million at the end-user level (+5.8% – Allan Woodburn Associates). However, after taking currency effects and inflation into account, the global market continued to fall. Estimates by Allan Woodburn Associates suggest the market has shown a real decline of 12% since the market peaked in 1998.

The US is the world’s largest agrochemical market, with sales of $7,132 million in 2003 (see Table 1.1). The market reached a peak of $8,848 million in 1998, but has since fallen back. Maize and soybeans are the largest crop protection markets, representing 43.9% of total sales. However, agrochemical sales have been hit by the introduction of genetically modified (GM) crops. Herbicides make up the largest sector of agrochemicals in the US market. Their sales represented 61% of the market in 2003. The combined US and Canadian agrochemical markets accounted for agrochemical sales of $8,067 million in 2003, or a little under a third of the total world market.

Table 1.1: World agrochemical sales by product type, 2003 ($ million)

Country	Herbicides	Fungicides	Insecticides	Others	Total	% change on 2002
US	4,364	700	1,725	343	7,132	0.0
Brazil	1,524	714	725	174	3,136	+60.7
Japan	876	700	843	370	2,789	- 3.5
France	814	762	182	216	1,974	- 8.5
China	480	348	578	29	1,436	+ 3.2
Australia2	694	101	209	350	1,354	na
Germany	593	442	125	53	1,212	- 5.5
Canada	720	84	75	56	935	+ 3.1
South Korea	196	277	272	29	774	- 0.3
Italy	264	273	199	36	771	+ 0.9
Spain	247	180	224	85	735	+ 2.1
UK	355	215	53	75	698	+ 2.4
Argentina	454	58	96	46	654	+ 9.0
Mexico1	165	118	191	32	507	na
Poland	191	95	29	25	341	- 2.6
Colombia	88	114	63	25	289	+16.5
Netherlands2	75	117	43	15	250	+10.4
Hungary2	114	52	14	4	201	na
Greece	76	45	71	19	212	+10.9
Pakistan	28	5	163	5	201	+25.9
Czech Republic	123	60	12	5	200	- 6.1
Ecuador	45	59	28	21	153	na
Belgium2	61	48	23	8	139	+ 0.3
Portugal	49	52	23	7	130	- 2.7
New Zealand	61	26	21	8	116	+ 1.4
Chile	36	33	27	13	110	na
Denmark	57	40	5	2	103	+12.6
Malaysia	56	6	16	4	82	+ 1.6
Venezuela	39	16	16	2	82	na
Austria2	34	24	10	5	73	na
Ireland	27	31	2	10	69	- 7.6
Slovakia2	32	16	5	5	58	na
Finland	38	14	3	11	67	+ 2.1
Paraguay3	45	8	44	3	67	na
Switzerland	27	24	7	3	60	- 4.3
Sweden	30	18	3	<1	51	+ 1.0
Lithuania	na	na	na	na	35	+ 3.3
Slovenia2	9	9	4	0	21	0.0
Norway	na	na	na	na	22	na
Latvia	na	na	na	na	16	- 1.4
Cyprus	2	3	5	<1	10	+ 4.5
Estonia	na	na	na	na	9	>10.0

Source: see individual country entries for details Notes: 1in local currency; 1figures are sales for 2001; 2figures are sales for 2002; 3figures are sales for 2000; conversion rates for Euro 1 used as follows – Czech Crown 31.89447, Danish Krone 7.43363, SwFr 1.52105, £0.69240; sources are detailed in the following chapter, and do not always cover 100% of the market; figures may not add up due to rounding; figures for India and Thailand were unavailable

Second placed was Brazil, where sales recovered sharply to $3,136 million in 2003. This mirrored the whole of the Latin American market, which had declined sharply in 2002, but recovered in 2003, as economic recovery continued in the region. Latin America accounted for 12-14% of world sales. Argentina is the next largest Latin American market. There, the market grew rapidly in the 1990s due to improved seed, fertilisers and crop protection, together with a fast take-up of direct drilling, especially of soybeans. In 1990, it was worth $253 million, but by 1997 the market had leapt to $925 million. However, in 1998, the market suffered a 16% fall, with herbicide sales hit by the introduction of Roundup Ready crops. In 2003, it was worth $654 million.

Asia accounts for around a quarter of world agrochemical sales. In 2003, the improved economic situation in South-East Asia boosted sales. The main market in the region is Japan, the world’s third-largest agrochemical market. Japanese agriculture is highly intensive and crop yields are among the highest in the world. It is dominated by rice, with an estimated 1.7 million ha harvested in 2003. The government has an ongoing programme to restrict rice production. Some 1.1 million ha has been taken out of production since the mid-1990s. Rice accounted for some 37% of agrochemical sales by value in 2003, so this has had a major effect on the market, which has been in decline for a number of years.

China is ranked second behind Japan in Asia. Estimates on the size of the market vary. However, many agrochemical companies have been looking to the country as a potential expanding market. Sales there rose by over 3% in 2003.

Western Europe accounts for slightly under a quarter of the world’s pesticide sales, with sales of over $6,500 million in 2003. The most important agrochemical market in the region is France, with around 30% of the region’s sales in 2003. This was followed by Germany (18%), Italy (12%), Spain (11%) and the UK (10%). Cereals, sugar beet, maize, oilseed rape, potatoes, sunflowers and grapevines are particularly significant markets. A fall in cereal and sugar beet areas in 2003, and a drought, combined to reduce sales, while pesticide prices also fell due to competition. Sales in the two largest markets, France and Germany, fell by 8.5% and 5.5%, respectively, in the local currency.

1.2 GM crops

The introduction of herbicide-tolerant and insect-resistant plants has affected the agrochemical market in the countries where they have been introduced. The area planted with GM crops has risen rapidly since their introduction in 1996. By 2003, some 67.7 million ha were planted, up 15% on 2002, according to estimates from the International Service for the Acquisition of Agri-biotech Applications (ISAAA – www.isaaa.org).

The ISAAA estimates that some 7 million farmers planted GM crops worldwide in 2003, with more than 85% of them living in developing countries. By area, almost a third of GM crops were grown in the developing world, compared with a quarter in 2002.

In 2003, just six countries (US, Argentina, Canada, China, Brazil and South Africa) were responsible for planting 99% of the world's GM crop acreage. This compared with just four countries (US, Argentina, Canada and China) in 2002. In total, 18 countries were growing GM crops, according to ISAAA. Ten of these were growing more than 50,000 ha of GM crops in 2003, including Australia, India, Romania and Uruguay.

The US is by far the largest producer of GM crops. In 2003, GM crop plantings there represented 63% of the global total. Plantings of Bt and herbicide-tolerant maize increased significantly, and the area of herbicide-tolerant soybeans continued to grow. Argentina remained the second-largest market for GM crops with 13.9 million ha or 21% of world plantings. Canada's GM crop acreage accounted for 6% of the world total, with increases in GM canola, maize and soybean plantings. In the European Union (EU), Spain is the only country to plant a significant area of GM crops, with Bt maize. Despite the continuing debate over GM crops in Europe and elsewhere, the ISAAA expects that the global area of GM crops and the number of farmers planting them will continue to increase. It forecasts that within the next five years, 10 million farmers in more than 25 countries will plant 100 million ha of GM crops. The global value of GM crops is expected to increase from some $4,500 million this year to $5,000 million or more by 2005.

By crop, soybeans dominate, representing 61% of the global GM crop area in 2003. Other important GM crops are maize, followed by cotton, then canola. By trait, herbicide tolerance is dominant. Herbicide-tolerant soybeans, maize and cotton covered 49.7 million ha in 2003, representing 73% of the global GM crop area. This is followed by insect resistance. There were 12.2 million ha of Bt crops (18%), while stacked genes for herbicide tolerance and pest resistance in maize and cotton amounted to 5.8 million ha (8%), ISAAA said.

The two dominant GM crop/trait combinations in 2003 were herbicide-tolerant soybeans and Bt maize, which together made up 75% of the global GM crop area. Herbicide-tolerant soybeans covered 41.4 million ha in seven countries, representing 61% of the global GM crop area. Bt maize was planted on 9.1 million ha in nine countries, equivalent to 13% of the GM crop area.

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