Top 20 Brazilian agrochemical firms: demand backing up sales

 

- Top 20 Brazilian agrochemical firms accounting for above 99% of the total market share

- Three quarters of the top 20 achieving two-digit growth

- Three reasons for the overall sales growth: increased soy planting area, higher demand for insecticide due to cotton bollworm, continued release of new product

 

According to Brazilian crop protection association (Sindiveg), in 2013 Brazilian agrochemical market value reached $11.60 billion, 18% up year on year, which is a growth for 3 consecutive years. The main reason for the market growth lies on the increased crop planting area; also the great demand for agrochemical products against field crop pest has contributed to the growth. Sindiveg predicates that Brazilian agrochemical market value will reach about $ 13 billion in 2014, as driven by the grown soy planting area.

 

The list of top 20 in the 2013 fiscal year published by AgroPages shows the entry level to be $ 5 million. The sales volume of the No.1 Syngenta is 428 times of the No.20 ranking Atanor, which reveals the serious disparity between the two ends. As seen from the sales of the top 20, the top 10 achieved total sales of $ 9.79 billion accounting for 84% of the total market value; the top 20 achieved total sales of $ 11.49 billion accounting for 99% of the total Brazilian agrochemical market value, which means Brazilian agrochemical market is almost entirely dominated by the top 20. Among the top 20, Nortox is the only local enterprise; the rest of the market is shared by 100 other companies, showing that Brazilian agrochemical market is basically monopolized by transnational companies.

The prior 18 companies all achieved sales growth in the 2013 fiscal year, of which 16 companies achieved two-digit growth. Chemtura achieved highest growth rate having reached 53.3%. Bayer CropScience, DuPont, Monsanto, UPL/DVA and Helm achieved strong growth, all reaching over 30%. Consagro Agroquimica and Atanor do Brasil were the only 2 companies on the list of top 20 whose sales decreased, of which Atanor dropped by 75%. 

 

Syngenta ranked No.1 with sales of $ 2.14 billion, saying that soy rice rebound and the favored exchange rate contributed to the sales growth especially to the doubled herbicide sales in Brazil in 2013. Bayer CropScience ranked No.2 with sales of $ 2.05 billion from hot sale of the fungicide Fox and Serenade，the insecticide Belt and the first biological formulations; CropStar was also a key product sold in the region. The No.3 ranking BASF achieved sales of $ 1.29 billion in 2013, for which the increased insecticide sale played a key role; additionally the Company succeeded in its release of the herbicide Kixor® and fungicide Xemium®; BASF also announced an investment program in a production facility in Brazil in June 2013 for extension of crop protection product to the benefit of long-term and sustainable growth.

 

There 4 companies achieving sales between $ 500 million to 1 billion. FMC is always an eye-catching player in the Brazilian market, whose sales in 2013 increased by 18% having reached $ 880 million, mainly attributable to its penetration into the soy market, release of new product and the strong demand resulting from grown cotton planting area; at the end of 2013 FMC announced an investment of $ 20 million in 3 years’ time for the extension of pesticide capacity. DuPont ranked No.5 with a tiny difference at sales of $870 million mainly resulting from the boosted demand for insecticide against the bollworm plague in Brazil. Similarly Dow AgroSciences achieved 28% growth also mainly because of the sudden demand for insecticide against bollworm. Monsanto also achieved satisfactory growth due to farmers’ increased demand for the glyphosate Roundup; Monsanto is said to have achieved 7% growth of herbicide sales volume in 2013 inducing the Roundup sale in Argentina and Brazil.

 

There are 7 companies achieving sales between $ 200-500 million, where Milenia, Nufarm and IHARA are very close to each other ranking respectively No.8, No.9 and No.10. For Makhteshim-Agan Industries, Latin America generated largest amount of sales in 2013, particularly the sales in Brazilian market; therefore its subsidiary Milenia achieved 28% sales growth. Starting from April 2014, with the change of the name of Makhteshim-Agan Industries into Adama, Milenia was changed into Adama Brasil. Nufarm suffered slight decrease of sales almost in all countries, except for its Brazilian subsidiary which could maintain a strong growth, saying that the successfully launched new glyphosate formulations in Brazilian market gave a positive effect to its income; meanwhile main crops in Brazil are vulnerable to pest damage which results in strong demand for the Company’s chlopyrifos, the sale of which nearly doubled over that of last year. IHARA dropped down to No.10 in 2013 from the No.8 in 2012, nevertheless the Company achieved 7% growth, having released a number of seed treatment agent and nematicide in 2013. 

 

Brazil is one of the most important market of Arysta LifeScience, accounting for 1/4 of the total market of Arysta LifeScience; Arysta LifeScience is one of the important market players in Brazilian agrochemical market, its sales accounts for 4% of the total market. Due to the bollworm impact, Arysta LifeScience achieved a 40% big growth of sales of insecticide against soy pest in 2013. As the only local Brazilian company in the top 20, Nortox maintained stable growth ranking No.12. For the No.13 ranking Cheminova, increased soy planting area, bollworm impact and the release of the new fungicide Authority® (flutriafol + azoxystrobin) are main reasons for its growth. Brazilian market is the most important market for UPL, accounting for 15% of its total sales; the Company’s sales in this region increased significantly after acquisition of DVA Agro.

 

The last 6 places in the top 20 are respectively Sipcam, Helm, Rotam, Chemtura, Consagro Agroquimica and Atanor do Brasil; their total sales in 2013 reached $ 461 million accounting for about 4% of the Brazilian market value.