IPROCHEM: Cultivated in Ukraine Agchem Market

Ukraine is the second largest country in Europe, as well as a large agricultural country in the world with 42.56 million hectares of farmland which accounts for 70% of the total land area of the country, being called the “Breadbasket of Europe”. Ukraine has rich black soil area accounting for 23% of the world total black soil area, mainly producing rape, maize, beet, sunflower and wheat.

“Ukraine has quite a lot of large-scale farms, but pesticide applications are at a low level. Ukraine relies on imported pesticide, and it is relatively easy to register and promote pesticide in this country of great potentials. These are the main reasons for us to choose Ukrainian market”, said Zhu Xianding, the board chairman of Chinese agrochemical enterprise IPROCHEM.

After 20 years’ development in pesticide business, Shenzhen IPROCHEM has grown into a dedicated crop protection product supplier backed up by a large overseas service team and a complete customer service system. Since 2009, IPROCHEM started its localized business operation in overseas market. East Europe is one of the important strategic market of IPROCHEM while Ukraine is a successful example of its overseas operation.

In 2010, IPROCHEM established its 90%-controlled joint venture in Ukraine, the IPROCHEM-SOYUZ. The company mainly engages in product registration in Ukraine, as well as marketing and promotion of Chinese pesticides. After effective localized operations, the company became profitable since 2011 with customers across 22 regions of 8 provinces in Ukraine. So far there have been 28 registered products in Ukraine, 15 of them are renewed.

“IPROCHEM’s successful landing in Ukrainian market is attributable to our business strategy and understanding of local market”, said Chairman Zhu.

Ukrainian market has been for long occupied by transnational companies supported by their wide product range, good technology and complete service system. The products of transnational companies are very popular among local users, it is difficult for IPROCHEM to break through their well-established supply chain. So IPROCHEM chose to set up a company in Ukraine and sent there experienced marketing personnel meanwhile to hire local employees to work together, starting product registration and promotion of Chinese pesticide to expand the market share.

IPROCHEM has done a detailed market survey in respect of product selection. Herbicide is the main product for supply in Ukrainian market while fungicide demand is quite big. As the quality of fungicide supplied by transnational companies is quite good, in the short run it is difficult for local farmers to switch to Chinese fungicide, therefore IPROCHEM Chooses herbicide to be the marketing target in Ukraine.
 
Ukrainian market is a very mature market where transnational companies have operated their business for a long time, price is not a decisive element to attract farmers. So for marketing IPROCHEM does not use the low-price mode but focuses on quality and service, which is more convincing in the eyes of buyers and farmers.

In the years ahead, IPROCHEM will further cooperate with Chinese vendors in development of Ukrainian market via timely product registration and quality upgrade to let the Chinese pesticide brands to get deep down into the heart of the local users.