Crop Protection Chemicals Market Growth to Spur on the Back of Rising Demand for Bio-based Crop Protection Chemicals during 2021-2031

Crop Protection Chemicals Industry Snapshot

According to a recent report by Fact.MR, market revenue of crop protection chemicals is slated to rise at a CAGR of 5.3% from 2021 to 2031, with total market valuation reaching US$ 122 Bn by 2031, thanks to continued government and private sector investments aimed at improving overall agricultural output to meet the high food demand of a growing population across geographies.

Around 800 chemically active compounds are recognised for use as crop protection chemicals around the world, according to the Royal Society of Chemicals, with herbicides, fungicides, and insecticides being three of the vital categories of such chemicals.

In recent years, focus of crop protection chemical research has been on developing compounds that are safer than their older equivalents in order to fulfil the demand for novel molecular solutions to manage pests that have gained resistance to older compounds. Besides, manufacturers have been very active in launching newer products in the past two years, which indicates their stern focus on product development and portfolio diversification.

Crop Protection Chemicals Industry Report Scope

Consumption Analysis of Crop Protection Chemicals from 2016 to 2020 Vs Demand Outlook for 2021 to 2031

Over the past half-decade, strong tailwinds from the agriculture industry have driven the market for crop protection chemicals. This was primarily witnessed in developing countries, with strong focus on improving their agricultural output.

The market is expected to recover as follows throughout the projected period:

• Demand for bio-based crop protection chemicals is anticipated to rise at a considerably quicker rate in the short term, aiding market recovery by Q4 of FY2021, in response to the shift towards sustainable farming.
• In the longer term, producers are anticipated to increase their investments in product development in order to diversify their product portfolios.
• Currently, synthetic crop protection chemicals capture nearly half of the market share as of 2020.
• However, bio-based crop protection chemicals are poised to overtake synthetic ones and gain 423 BPS in market share by 2031 in response to the shift towards sustainable agricultural practices.
• The market in Europe is anticipated to be expanding at 5.9% CAGR through 2031.

What are Some of the Driving Factors Responsible for Steady Growth in Demand for Crop Protection Chemicals?

Crop protection chemicals are extensively used in modern farming as an economical method to increase crop production by keeping pests and weeds from harming the crops. As a result, increased agricultural yields assist in providing food security for the world's expanding population.

Brazil, China, and the United States, according to the Food and Agriculture Organization (FAO), are substantial consumers of crop protection products. China for instance consumes over 1.8 Mn tons of pesticides annually, followed by US and Brazil with 0.4 Mn tons and 0.3 Mn tons, respectively. One of the primary factors of increased agricultural production in these nations is the widespread use of these chemicals.

Plant diseases and pests have become more common as a result of changing environmental circumstances. Climate change has a significant influence on agricultural output and insect susceptibility. Agricultural vulnerability to various pests and diseases is increasing as a result of climate change, which has an impact on crop output.

China remain one of the most lucrative countries, which uses over 15 Kgs of these crop protection chemicals per hectare, followed by Brazil, which uses nearly 6 Kgs of these chemicals per hectare.

This higher amount of consumption of crop protection chemicals by both, developing and developed countries, are, in turn, responsible for higher growth forecast being anticipated in the market, across geographies.

Country-wise Analysis

Why is Latin America Anticipated to Become the Growth Epicentre for Crop Protection Chemicals?

As of 2020, Latin America remained a key market to target for crop protection chemical manufacturers. From 2021 to 2031, the market in Latin America is anticipated to be expanding at a steady CAGR of 4.7%.

Infestations of worms, weeds, and fungus have become one of the foremost obstacle to agricultural quality and productivity in the region. Crop protection chemicals have grown in popularity in the region as a result of evolving technology and advances in agricultural practices.

Brazil and Argentina continues to expand at a higher rate in Latin America market, with Brazil being one of the top importers of crop protection chemicals in the world. Between 2018 and 2019, the nation authorized a record amount of pesticide consumption, the most since 2010.

Besides, due to an increase in demand for healthier and more sustainable foods, developing nations in Latin America have remained one of the largest consumers of crop protection chemicals during the past half-decade and are anticipated to exert its dominance during the long-run forecast period 2021-2031 as well.

How is the Market Shaping Up across Other Important Countries?

U.S.: The US was the largest exporter of agricultural produce of 2020, accounting for nearly 26% of global corn exports. Insecticides and fungicides were the most often used crop protection chemicals, followed by herbicides.

Increasing need for food is escalating demand for agricultural productivity, which is driving market growth. The market for bio-based crop protection chemicals is also being driven by growing concern regarding green agricultural practices and the loss of many conventional products due to excessive use of synthetic chemicals.

This is poised to keep the U.S. as one of the leading markets for crop protection chemicals during the period of 2021-31.

Brazil: Over 41% of total land is occupied by farm owners for agricultural activities. Nearly 8% of the total area is used for crop production, such as soybeans, sweet potatoes, maize, peanuts, etc.

Brazil is a world leader in sugarcane production, with 600 Mn tonnes or more produced each year. It is the world's second-biggest producer of soybeans, and these beans are consumed in huge quantities all around the world.

These statistics indicate that Brazil is well-positioned and heavily invested in agricultural production. Owing to the largescale dependence on agricultural production, Brazil has remained one of the vital consumers of crop protection chemicals as of 2020.

China: China has 7% of the world's arable land and feeds 22% of the world's population with it. It has had significant population expansion and is largely become self-reliant to satisfy food needs. It has been steadily reforming its crop protection chemicals industry since 2016 and has established a ‘zero-growth' action plan to restrict synthetic crop protection chemical use.

As a result, registration of bio-pesticides, particularly microbial pesticides, is steadily increasing. The need for bio-insecticides in the country is projected to rise in the future years as the country places greater emphasis on environmental sustainability while preserving agricultural productivity.

Category wise Analysis

What Makes Grains & Cereals the Most Important Crop Type for Crop Protection Chemical Usage?

Because of widespread use of crop protection chemicals in grain production, the cereals market has seen rapid development in recent years. According to FAO, global cereal output would increase by around 2%-3% in 2021 as compared to the previous year.

Furthermore, growing worldwide population has resulted in greater focus on food security and strong demand for crops, which has aided the rise of the cereals segment.

If current trends of food availability in some parts of the world continue, over 841.4 Mn people will be hungry globally by 2030-end, according to the State of Food Security and Nutrition in the World (SOFI) 2020 report, and the world will miss its 2025 and 2030 malnutrition eradication objectives.

According to the FAO Chief Economist, these worrying findings are due to the unaffordability of healthy meals, with 3 Bn people worldwide in dire need of nutritious food.

Additionally, governments in developing countries have been providing subsidies for the adoption of crop protection chemicals, to improve the overall agricultural output. Thereby, rising focus of governments on providing at least basic access to appropriate nutrition is anticipated to keep the grain & cereals segment the most attractive one in the market.

Which Crop Protection Chemical Product is Anticipated to Dominate the Market Going Ahead?

Agricultural vulnerability to various pests and diseases is increasing as a result of climate change, which has an impact on crop output. As a result, every change in the climate causes a shift in farming techniques, resulting in a decrease in output. In addition, sporadic rainfall in several locations has increased the occurrence of fungus infection, in turn escalating the requirement of fungicides.

Farmers' reliance on crop protection solutions such as insecticides, fungicides, and herbicides for effective pest and weed avoidance has risen as a result of these key reasons, which is fuelling market expansion.

Besides, herbicides are seeing substantial increase as a result of a manpower scarcity in many developed nations, such as the U.S. and countries in the European Union, for mechanical weeding. Herbicides' superior efficiency over manual weeding procedures is also predicted to boost the segment's growth in the coming years.

Introduction of new herbicide products with distinct properties based on weed selectivity, crop emergence, and other factors is boosting market growth. On the other hand, growing use of herbicide products in agricultural production is drawing a growth in the area under genetically modified crops across diverse areas.

Owing to the aforementioned factors, herbicides are poised to remain the most attractive segment in the crop protection solutions market and are anticipated to expand at a single-digit moderate CAGR rate during the forecast period.

Competition Landscape

Companies have been heavily investing in the research & development of newer crop protection solutions and focussing on geographical and capacity expansion, so as to further improve their overall market presence. Some of the recent developments in the market include-

• Corteva Agriscience, announced its new Resicore® XL corn herbicide for the 2022 season in July 2021. It's a three-mode herbicide that works both before and after emergence.
• Corteva Agriscience announced in March 2021 that it will adopt Qalcova active for spinosad and Jemvelva active for spinetoram to provide farmers with best-in-class insecticide solutions. Together, these two organically derived active components will give farmers with efficient pest control alternatives for over 250 crops throughout the world.
• Rotam CropSciences Ltd., a worldwide agricultural solution provider specialising in crop protection, announced the opening of a Krpros in Brazil in March 2021. A method for making the chemical element copper available to crops for an extended length of time. As a result, the plants' defences will be strengthened, and they will be more resistant to key crop diseases.

Key Segments as per Crop Protection Chemicals Industry Survey

• By Crop

  • Crop Protection Chemicals Grains & Cereals
  • Crop Protection Chemicals Pulses and Oilseeds
  • Crop Protection Chemicals Fruits and Vegetables
  • Others (Plantation Crops, etc.)

• By Product

  • Herbicides
  • Insecticides
  • Fungicides
  • Others (Rodenticides, etc.)

• By Source

  • Synthetic Crop Protection Chemicals
  • Bio-based Crop Protection Chemicals

• By Form       

  • Liquid Crop Protection Chemicals
  • Solid Crop Protection Chemicals

• By Mode of Application

  • Foliar
  • Seed Treatment
  • Soil Treatment