Biopesticide in Latin America: The market is changing, where are the future opportunities?

According to Mordor intelligence' report, the Latin America biopesticide market was valued at USD 305.1 million in 2017 and is expected to register a CAGR of 16.4% during the forecast period (2018-2023). Brazil is the largest market share holder of biopesticides in Latin America with the revenue USD 103.5 million in 2017 and is expected to register a CAGR of 10.3% during forecast period (2018 - 2023).

In Latin America, the biopesticides market is witnessing a steady growth in the past years. As more and more companies enter the Latin American biopesticide market, what changes have occurred in this market, and what new opportunities and challenges have emerged? What types of biopesticide products are in strong demand in this market? I believe these issues are of concern to every company that wants to enter the Latin American market. Therefore, we interviewed several companies that performed well in the Latin American biopesticide market, they are Rizobacter, Koppert Brazil, TENSAC and Biotrop.

What has changed in the South American biopesticide market in the past few years?

Matias Santipolo: The South American market is changing, we could not say that it is only for one factor but that it is a set of interrelated factors.

As in other parts of the world, society looks more and more closely at agriculture and calls for greener technologies. This social pressure is generating changes in the demand for crop protection products, for instance, products with excellent agronomic efficiency, to regulate their use, even becoming banned. For example, in Argentina the chemicals that can be used depending on their toxicity are delimited by regions.

Another factor influencing the growth of the biopesticide market is the constant increase in cases of resistance to chemical active ingredients. Today in countries such as Argentina, Brazil, Uruguay and Paraguay, it has been more than 20 years since the launch of the first glyphosate resistant GM crop, it was what changed the agriculture model and allowed us today to have high production levels, but in these more than 20 years is becoming more frequent to find cases of resistance to chemical molecules, making it difficult to control weeds, diseases and insects. It is here where biopesticides along with chemicals help to fight these pests and illnesses that are difficult to control.

Also in regions called "agricultural frontiers" such as the North Brazil region, the Chaco Paraguay / Bolivia region and western Argentina, carrying out agriculture is really challenging, the weather conditions are very aggressive and the incorporation of beneficial microorganisms help to make agriculture viable.

In this context of a society that demands agriculture with less environmental impact, where we find increases in resistance to agrochemicals and the need to increase the surface in areas considered not optimal for agriculture, the growth of the market for biopesticide products tends to continue to grow, following the world trends where the biopesticide market grows at rates of 14% per year and the chemical market grows 4.5%.

Gustavo Herrmann: The demand is becoming more consistent, as the growers start to implement IPM as a mandatory concept, in order to achieve environmental and economic sustainability. The market (specially the industry) is becoming more professional, as the requirements for quality and high performance are increasing from users.

Gregorio M. Katz: The trend in the demand for bio-products is increasing, not only in South America, but in the world; this due to the constant restrictions of the allowed MRLs of the requesting countries; as well as to the global demand on the consumption of more sustainable products. In addition, the markets seek to have greater competitiveness at the global level, so they aim to look for productive alternatives to the conventional one, for organic productions and to look for niche markets, which grow more and more, and which pay another price for the fruit (example: sugar, lemon, fruit trees, pit, nugget, vine, etc). Based on this, we think that the markets are looking for BIO alternatives over conventional products; This generates an expansion of a niche market, and we consider that the trend is in that sense.

Eduardo Perez: The improvement of effectiveness of the biological products over the chemical products has been the main reason why the demand for biological products has increased in the past five years. 

More and more biopesticide companies pay attention to and enter the South American biopesticide market. Where do you think the future market opportunities for South American biopesticides are?

Matias Santipolo:  The actual market is a great opportunity for biopesticides because there are no launches of chemical active ingredients in the coming years that will solve all the problems that farmers currently have. The solutions will come by mixing old modes of action with new modes of action, applying more efficiently and using Biopesticides. Biopesticides will help pesticides to increase control, avoid resistance breakdown and increase crop yields.

The biological compatibility and survival of biopesticides are a determining factor since most microorganisms die in contact with chemicals or in environmental stresses. Companies that manage to industrialize biopesticide have excellent opportunities in the market. Rizobacter has been working for more than 40 years on the compatibility of microorganisms with chemicals and resistance to abiotic factors.

Gustavo Herrmann: When we look to the biggest market, Brazil, the opportunities are larger in row crops, like soybean, corn, cotton, sugarcane and others. At the same time, the challenges are as big as the areas, because these segments are chemical intensive crops. In other countries like Chile and Colombia, for example, the focus of biologicals are more related to high value crops, like berries, tomatoes, flowers, etc.

Gregorio M. Katz: We think that the future opportunities for biopesticides are in intensive regional productions; case of lemon, fruit trees, grapevines, horticultural crops.

Eduardo Perez: The main opportunity today in the South American biopesticide market is in the food production for export. And in the next few years, it is expected to be an increase in extensive crops. 

What do you think are the biggest challenges in promoting and developing biopesticides in South America? Why?

Matias Santipolo:  Generally, the registrations of pesticide patents are preferred for the ministry of agriculture than those of chemical pesticides, mainly when it comes to native microorganisms. Apologies I do not have much knowledge of the regulatory area.

Gustavo Herrmann: The biggest challenge in broad acre crops is to combine biopesticides with the traditional ones, in IPM programs that show more productivity and less impact for the environment. And of course, at the same time do not increase costs to the growers.

In the horti sector, to achieve a large number of small growers and keep the high level of quality within bioproducts can be very challenging, so logistics is key for any IPM program.

Gregorio M. Katz: The greatest challenges lie in the regulations of the different countries, in being able to register them in the State institutions with often exorbitant tariffs; This is because many times the requirements that a biopesticide has to pass at the time of registration, are the same as that of a conventional product.

Eduardo Perez: The major challenge relies in the ability to introduce these products in extensive crops like corn, soybean and wheat with the purpose of not only using them as PGPR to improve their performance, but also as bioinsecticides and biofungicides. 

In terms of registration supervision, do South American countries have special requirements for the registration of biological pesticides?

Matias Santipolo: Generally, biopesticide patent registrations are privileged, especially when it comes to native microorganisms. Sorry I do not have much knowledge of the regulatory area.

Gustavo Herrmann: Most of the countries includes biologicals in the same regulation of chemical pesticides. There are some peculiarities that may be different in one country than the other, but in general everyone has to follow the PPP (plant protection products) registration path.

Gregorio M. Katz: In some cases, the regulatory entities of each country have some differential biopesticide treatment, what happens is that from the point of view of technical analysis, beyond physicists, chemists and toxicologists, a lot of study or testing time is required (similar to a conventional one) requiring a lot of information, which is sometimes unnecessary and unjustifiable.

Eduardo Perez:  No. The big problem in South America is that, in general, there is no specific legislation for biological products. And this is an important issue to be resolved in different countries. 

At present, what kind of biopesticides products in South America are in high demand?

Matias Santipolo: The main microorganisms used in South America are Bradyrhizobium spp, Bacillus Subtilis, Bacillus Thuringiensis, Beauveria Bassiana, Trichoderma Spp, Paecilomyces fumosoroseus.

There are products on the market with the same microorganism, but not all have the same efficiency. This difference in the efficiency of the products is due to the artificial selection of microorganisms, it is also possible to see notable differences in the concentration, shelf time and formulation between products of the same microorganisms.

Gregorio M. Katz: The BIO products that are most in demand belong to the order of the Biologicals (microorganisms) mainly.

Eduardo Perez: Nowadays, biopesticides are mainly required in intensive crops but day by day are beginning to be used in extensive crops as well.

At present, what biopesticide products has your company launched in South America? What new products will enter the market in the future?

Matias Santipolo: Currently Rizobacter launched Rizoliq LLI, which is the only liquid inoculant registered in Brazil based on Bradyrhizobium spp, that can be in contact with agrochemicals in the seed for 60 days, currently most of the products on the market do not resist contact with agrochemicals. Rizoliq LLI is a great advantage for the seed treatment industry and for the farmer who does not have to damage his seed by re-treating with inoculants before planting.

In Argentina we launched a Rhamnolipids-based Bio-surfactant, it was an innovative launch, it is an adjuvant for tank mix use that replaces traditional adjuvants.

In Paraguay, Argentina and Bolivia we launched Rizoderma which is a fungal Bio-controller based on Trichodema, specifically developed for seed treatment.

The new launch in Argentina, Bolivia, Paraguay, Uruguay and Brazil will be Rizoliq Dakar, an inoculant based on Bradyrhizobium spp, for inoculation in soybeans, which due to the artificial selection of resistant bacteria, we obtained an inoculant that resists high temperatures, salinity and resistance to drought. This new inoculant resists very stressful conditions, together with new varieties of Soybeans will allow agriculture in regions considered to be marginal. 

Gustavo Herrmann: We’ve launched Challenger, the first bioinsecticide registered for the control of ACP (Asian Citrus Psilid), the vector of greening disease in citrus crops. The product can be used in combination with most of the recommended chemicals for the pest, specially in flowering and harvest seasons, reducing the residues of pesticides in the end product (fruit or juice). This product was developed in partnership with Fundecitrus (Citrus Industry Research Center) and ESALQ/USP (University of São Paulo) and it is now available for Brazil.

In the pipeline, we intend to launch a new Bacillus based product with nematicidal effect, EPNs (entomopathogenic nematodes) as bioinsecticides and new macro organisms, like Telenomus podisi, a parasitic wasp to control the soybean stink bug.

Gregorio M. Katz: Those that TENSAC promotes are the Esten 80 and Esten 80 H. Plus, Bioinsecticides. The plan is to launch a bio Herbicide and a specific phyto regulator to tobacco.

Referring to this question, we inform you that the ESTEN 80 product was nominated for the Innovation Award "Bio-based Material of the Year 2020" at 13th International Online-Conference of Bio-based Materials in Cologne Germany, 12-13 May 2020.

Eduardo Perez: At present, our company already launched biofertilizers, PGPRs, inoculants and nematicides products. In the next few years, we will follow with the introduction of bioinsecticides and biofungicides. 

This article was initially published in AgroPages '2020 Latin America Focus' magazine. Download it to read more articles.