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Price of China’s domestic formulation will not rise sharply in the short term followed pesticide TC
Mar. 28, 2017
By Think Real - Due to environmental supervision and other reasons, price of some bulk pesticides TC raised steadily from the end of 2016. In this regard, the downstream production enterprises of formulation were facing the pressure of rising procurement costs, but some formulation companies said that formulation prices will not follow the pace of pesticide TC price to go up in the short term.
According to Beijing Mindleader Agroscience Co.,Ltd.(Mindleader), a formulation company which develops rapidly in recent years, since the pesticide TC price has experienced the downturn in 2015 and 2016, it’s reasonable that the price enjoys a rebound in 2017. For the present, except several pesticide TC are suspected to be hyped, most of the pesticide TC prices just return to a reasonable level, so the current price is still acceptable for the downstream formulation production.
Besides, in addition to considering the cost of pesticide TC, the formulation pricing should be also based on brand value and manufacturers’ service quality. As for the large-and medium-sized formulation enterprises, the cost of the pesticide TC only accounts for about one-third of the sales price. Therefore, although the raise in the pesticide TC price inevitably brings short-term decline in gross profit, it has not yet had great impact on the price of terminal formulation for the time being.
The means to deal with the price increases in upstream include: for some conventional bulk products, stock them in advance according to the market trends while adjust the product structure in time.
Source: Think Real
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