AgroPages-2024 CPEW Series 1: Global agrochemical market recovering slowly, competition and consolidation to promote balance between supply and demand-Agricultural news

The 8th China Pesticide Exporting Workshop (2024 CPEW) was held in Hangzhou, China, on July 18 and 19, 2024, participated by nearly 600 representatives from 230-plus enterprises at home and abroad across 26 countries in Asia, Europe, Africa and America.

2024CPEW agenda

Currently, the market appears relatively slow, attributable to macroeconomy issues, the cyclical fluctuation of the agrochemical industry and the change in supply and demand. In this context, the workshop focused on how the Chinese pesticide industry can rebuild its image in the international pesticide supply chain, explore innovation potentials and create values to improve the adaptability and resilience to market fluctuation with the purpose of helping agrochemical enterprises to better position themselves in the new global industrial structure towards collaborative innovation and sustainable development.

The workshop is hosted by AgroPages, exclusively sponsored by Qilu Pharmaceutical, co-organized by SINO-AGRI, Hebi Bread Chemical, Chengdu Newsun Crop Science and Hangzhou Udragon. Also, great support was extended by Huimeng Biotechnology, TrustChem, Hubei Xingfa, Nantong CAC, REACH24H, LYDODO, Yonon, Ukravit, Yangnong Chemical, Hebi Quanfeng, Lansheng Biotech, Ningbo YICHEM, Dalian JOIN KING, Nongbo Bio-Technology, Staphyt, Yingke (Changzhou) Law Firm, Shanghai U-Express, PHEROBIO, Hongkong Thinkway and Jiangsu Jinwang.

During the two-day meeting, 25 speakers at home and abroad steered in-depth discussions on 23 hot topics, covering global agrochemical market trends, product and solution innovation, development potential of key agricultural markets, corporate marketing strategy, and addressing and analyzing the opportunities and challenges facing the agrochemical industry. The insights and judgments of the participating experts gave Chinese agrochemical enterprises an indicative direction towards collaborative innovation and sustainable development on a long-term basis.

AgroPages is prepared to present a series of reports on the 7 key topics addressed at the workshop.

Topic 1: Recovery of global agrochemical market, competition and consolidation promoting balance between supply and demand

During the unprecedented waves of transformation and restructuring of the global agriculture and the crop protection industry, the Chinese pesticide industry has stepped into a period of rapid transformation and upgrading. Eva Hu, general manager of AgroPages, says in her opening address that the agrochemical industry is experiencing profound changes in technical integration and digital convergence which call on enterprises to strengthen innovation and collaboration and to change the product-based way of thinking into the systematic way of thinking.

Eva Hu, general manager of AgroPages

Du Hui, Deputy General Manager of Qilu Pharmaceutical Crop Protection Business Unit, the exclusive sponsor of the workshop, delivered a speech presenting a deep analysis of the current challenges and opportunities facing the agrochemical industry, saying that the crop protection industry is experiencing a significant increase in demand for green and environment-friendly products, especially in Europe and other developed countries where strong expectation exists for a change. The presentation highlights the importance of biopesticides, which is a driver of global agricultural growth. He said Qilu Pharmaceutical has committed to research, development, and production of efficient and high-quality biopesticides for many years. Many products have been awarded China Green Certification and the USDA Organic Certification.

Du Hui, Deputy General Manager of Qilu Pharmaceutical Crop Protection Business Unit

China is a key global agrochemical market and the production and price fluctuation of the Chinese agrochemical industry in recent years has undoubtedly brought a lot of uncertainties to the global supply chain. This volatility not only affects the stability of pesticide supply but also has a knock-on impact on global agricultural production costs and agricultural product prices.

Yan Duanxiang, a researcher at the ICAMA of the Chinese Ministry of Agriculture and Rural Affairs, reviewed the maturity and development of the Chinese pesticide industry from a personal perspective. He made a deep analysis of the violent fluctuation experienced by the agrochemical industry in recent years, stressing that to fix the current issue of imbalance between supply and demand, it is necessary to expand the international market to form a new stable supply and demand relationship and meanwhile to solve the problem of the out-of-order competition among Chinese enterprises in the international market, to the benefit of improvement of profitability.

Yan Duanxiang, a researcher at the ICAMA

He suggested a number of practical solutions: Firstly, to get ready for the global economic recovery, especially the benign interaction of China-US relations. Secondly, to advocate close cooperation between international trading enterprises and production enterprises to establish a mutual safeguard mechanism to jointly cope with market uncertainties. Thirdly, to give full play to the decisive role of the market in the allocation of resources to promote industrial restructuring and integration; Finally, to strengthen research and development to form special industrial features and establish a long-term competitive advantage.

Nomman Ahmed, Executive Director of Global Practice Advanced Analytics & sigma at Kynetec, analyzed the global industry trends and key drivers to the pesticide industry growth from a global perspective. He stressed the importance of a review of history to predict future market development, based on which Ahmed conducted a comprehensive forecast of the pesticide market. Ahmed said that despite oversupply and overcapacity, the market is expected to rebound by 3.7% in 2025, after the 20% decline in 2024. Ahmed expressed great optimism in biopesticide and biotechnology, which are expected to become a main driver to market growth by 2029, driving the significant growth of the entire pesticide industry. In addition, the presentation introduced an in-depth discussion on the price trend of the pesticide industry, agricultural policies, application of GMO technologies, international trade prices and generic market development.

Nomman Ahmed, Executive Director, Global Practice Advanced Analytics & sigma, Kynetec

Rohit Nagraj, Senior Vice President, Centrum Broking Limited, provided an overview of the latest landscape of the global chemical industry. In the first four months of 2024, the manufacturers in the EU’s 27 countries suffered a 3.6% output decline, a significant drop compared to the same period in 2023. In particular, the output in the pharmaceutical industry fell by more than 10%.

However, in the context of global economic volatility, China could still lead the international market with its strong chemical production capacity, which accounts for more than 40% of global chemical sales. In the United States, as the inventory level is balanced and the terminal market shows signs of solid demand, chemical production is expected to grow by 2.2% in 2024, of which agrochemical production is expected to grow by 2.6%. The presentation also gave a detailed analysis of the performance of multinational agrochemical companies such as BASF and UPL while exploring the critical role of China and India in the global trading of agrochemical products concerning inventory management, capital expenditure and anti-dumping investigation.

Rohit Nagraj, Senior Vice President, Centrum Broking Limited

Samir Dave, Secretary-General of the Indian pesticide organization PMAFI, shared the opportunities and challenges facing the pesticide industry in India, demonstrating the industry’s rapid growth. Although India experienced a decline similar to China last year, the overall growth momentum remains strong. Speaking of the pesticide industry’s challenges, he talked about the pesticide anti-dumping cases in China and India, which reflected the fierce competition between the two countries in pesticide exportation. Dave predicted that anti-dumping measures may become more common in the future, given the complexity of the global trading environment. It is worth noting that Dave mentioned in the presentation that PMAFI and India’s CSIR are jointly conducting an intermediate strategic project to reduce dependence on imports from China. The project measures include planning the launch of an intermediate project, the development of new compounds, and the innovation of future formulation products, including biological products. Hence, the Indian pesticide industry reveals its strong competitiveness and far-reaching planning.