Spain is one of Europe’s major agricultural markets, with a total agricultural area of 2.48 million hectares, second only to France in the EU. Spain is renowned for its European fruit and vegetable gardens, and over 60% of its fruits and vegetables are exported, 95% of which are exported to other EU countries with the rest being exported to China, Japan and the United States.
Spain not only ranks among the world's agricultural powers due to its strong exports, its agriculture has also been modernized continuously. Spain has been planting ecological agriculture since 1974, and since the 1990s, its ecological agriculture has developed rapidly. It currently has the largest organic agricultural area in Europe.
Spain has many manufacturers of bio-solution products, whose products are sold around the world. LAINCO S.A. is one of the major competitors in this market, and has a strong distribution network in Spain, as well as operations on five continents. AgroPages recently exclusively interviewed LAINCO's Technical Marketing Manager, Hugo Cores, who introduced us to the problems faced by the Spanish plant protection market and how they overcame fierce market competition.
Hugo Cores, Technical Marketing Manager of LAINCO S.A.
AgroPages(A): Please briefly introduce LAINCO’s history and current development.
Hugo Cores(H): LAINCO, S.A. is a Spanish company founded in 1934, and is dedicated to the research, development, manufacture, packaging and marketing of agricultural and pharmaceutical products. In the agro sector, after all the years of experience, we are present in five continents and sell in more than 35 countries around the world. To achieve this presence, we have developed strong and long-term relationships with third-party companies in many countries to market our products, after signing some of those agreements over 25 years ago.
Historically, we manufacture plant protection products. We also have our own formulations and all our products are produced in our factory in Barcelona. Several years ago, we have started to develop new products, focusing on categories such as biostimulants, which have been cautiously selected following growing demand within the sector. This rising farmer specialization, and in general within the sector, has enabled us to launch a new line of bio products with new biofertilizers, which are the result of over five years of research and trials.
A: Please introduce LAINCO’s development and business advantages in its main markets.
H: In Portugal and Spain, we are in the markets on our own, with the latter being our main market at present. In Spain, we are also a really well known company, with a strong distribution network and most importantly, a reputation for quality products. All those factors, plus our experience, have made us one of the main companies in the sector. Furthermore, LAINCO, S.A. Has always had the ability to adapt to new trends and to change with market demands. Among these trends, biologicals have grown quickly in popularity in recent years, so we have created a new line within the company to work on those products. We have invested over EUR5 million on research and development and a new manufacturing plant for microorganisms in 2019 to boost this new line of products, not only in Spain but also throughout the world.
A: In the early years of your development, LAINCO cooperated with a Japanese company. What is the company’s external partnership now? How do you see the trend of consolidation in the global industry?
H: As I have already mentioned, third-part relationships are a key part of our success. For many years, we have collaborated with Hokko, distributing their products in Spain, but we have also established really profitable relations in reverse. In many countries, we have partnerships with companies that develop and market LAINCO products. We are always looking for well-established partners that share our business vision and can work with us to create a win-win relationship.
This strategy is key to a company that has been growing year after year. This way of working enables us to overcome all recent merges and purchases in our sector. Many of our competitors have become really strong due to these mergers, however, LAINCO has maintained its growth.
A: What is the current situation and development trend of the Spanish plant protection market?
H: In Spain, the use of phytosanitary products increased last year by about 1.6%, according to the latest data from MAPA, but the feeling on the field is that at a European level, many active substances are being lost, and only some can be replaced by others with similar qualities. The lost of actives, such as CIPC(chlorpropham), chlorpyriphos and, in a new future, mancozeb, can open a path for other products, such as biologicals, which will be an opportunity to establish a presence in these niche markets.
Furthermore, Spanish farmers are really well prepared, with considerable technical knowledge, so they only need the tools. In fact, according to the last figures from Eurostat, Spain is the country with the most hectares of organic production in Europe, so it is now the time for Spanish companies to invest in new biological actives, develop the right tools, and establish the right direction to our farmers.
A: How does LAINCO compete in the biological area of crop protection and nutrition? How do you see the development trend of biological products in less developed markets?
H: We are a company that invests a lot yearly in R&D. Our first project to test biologicals was with Trichoderma spp. in 2002. Since then, we have been generating a pipeline of products, which, after many years, we decided to market. We have launched several biofertilizer, biostimulant and biocontrol solutions that have become popular in the market.
There are many companies producing biological products in Spain, specially biofertilizers and biostimulants, due to reduced regulatory costs in comparison with biocontrol ones. This is one of the issues facing farmers, and there are many solutions that are, unfortunately, low quality in many cases. To market a new product is difficult and costly and requires considerable efforts, time and economic resources. For us, maintaining the trust of farmers and distributors in our products is essential. This will always be our strategy, to ensure reliability, good products and high quality.
These three concepts have been the basis of our work during the 86 years of our history, so we are confident in continuing working in this way. All our products are backed by many years of work from the lab to the field, where we perform many tests before launching any product. This strategy is not the quickest but is always the safest, allowing us to develop 100% reliable products and maintain the quality of the LAINCO trademark.
Regarding other countries, not all of them are prepared for this change, but I think that biologicals will arrive worldwide quicker than many people think. The key factor for the spread of these products around the world from our own companies is technical knowledge. From our experience, an example is biocontrol product. If the handling of the product is not good, even an excellent one could fail, so it is our task to transmit this “know how” to farmers.
Our business strategy for this new line of products is to find the best partners in each country to develop these solutions, while always considering the need for technical support and offering the security of having a solid company behind them. To select a new partner for developing a biological product in a new market is never easy, because a wrong choice can knock down any product.
A: What is LAINCO’s production situation now? During the current COVID-19 pandemic, how does the company manage its own supply chain?
Sincerely, COVID-19 is a difficult situation not only for us, but also for the entire industry. LAINCO has developed internal safety and health protocols in line with government measures, but we have never stopped our production. Our work has remained part of an essential industry and we have made greater efforts to keep supplying distributors and farmers, who more than ever need our support. We have two priorities, to keep our staff safe and to keep supplying our customers in an essential sector, such as agriculture. Fortunately, so far we have achieved them, and we are currently working as normal.
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