Briefing on Export of Pesticides to Africa From China in 2015

According to the export statistics from China Customs, export volume of pesticides  reached 1,381.5 kilo tons under HS code 29&38 during January to November in 2015, with total amount of $6,670 million. Among which, 192.3 kilo tons were exported to African  market, which represents 13.9% of the total and decreased by 26.5% y-o-y. The export value was $641.1 million, which was 9.6% of the total and decreased by 23.8% y-o-y. The decreases in price and volume were mainly affected by the adverse market conditions. However, demographic dividend, potential arable land as well as undeveloped industrial base also indicate significant development space for this currently $1.7 billion agrochemical market. From the perspective of product form, 14.8 kilo tons of 150 products are active ingredients, with the value of $106.7 million and constitutes 16.6% of the total. The total volume of 279 different formulation products is 177.4 kilo tons with value of $533.93 million, which constitutes 83.3% of the total. Formulation is still the main form for export to Africa.  African agrochemical companies, represented by Candel from Nigeria, built or expanded formulation facilities in 2015. Africa is expected to manufacture the formulations locally, therefore the export of active ingredients to Africa will probably rise.  This briefing article analyzed the pesticides exported from China to Africa during January and November in 2015 by countries, product categories, etc., aiming to help readers understand category structure of pesticides that exported from China to Africa, which will provide reference for the market entering. 
 

Top 10 African countries analysis
 

Export of pesticides from China has covered 44 out of 56 countries in Africa. Top 10 countries by export value are Nigeria, South Africa, Ghana, Ivory Coast, Egypt, Kenya, Cameroon, Tanzania, Ethiopia and Guinea. The amount of export value of these top 10 countries constitutes 85.9% of the total export value to Africa from China. In general, pesticide in the form of formulation is the major part due to the undeveloped industry base in Africa. Import of active ingredients is over 60% in South Africa, however, the import of formulations constitutes the significant part in all the other 9 countries, with over 97% in most of these 10 countries. This indicated the general trend in African market.

 

Top 20 products analysis
 

The total export value of the top 20 pesticide products (see Table 1) in Jan-Nov 2015 is $441million, which constitutes 68.8% of the total market value exported to Africa from China. The volume is 159kilo tons, which is 82.7% of the total. The statistics showed the high concentration rate of pesticide products, mainly the popular bulk products.  In terms of product categories, herbicide is still the largest for export. 9 out of 20 main products are herbicides as shown in Table 1, which constitutes 63.3% of the total. Compared to 2014, glyphosate IPA, paraquat, glyphosate remain to be the top 3 products, however, with export value decreased significantly  by72.6%, 52%, 50.9%. 9 products are insecticides, which is 25.1% of the total export value in the list. 2 are fungicides, which constitutes the remaining 6.2%. The export value of 14 products out of 20 exceeds $10 million, which are: glyphosate IPA, paraquat, glyphosate,  2,4-D-dimethylammonium, atrazine, glyphosate-monoammonium, tebuthiuron, lambda-cyhalothrin, imidacloprid, chlorpyrifos, dichlorvos, emamectin, mancozeb, metalaxyl+mancozeb. The export value of these 14 products makes up 90% of the total 20 products, and is also 68% of the total value of pesticides that exported to Africa from China. These 14 products are exported to Africa mainly in formulations, the value of which is 6 times than that of active ingredients exported. Table 2 lists the top 10 formulations that exported to Africa from China in 2015.

 

Top 20 companies analysis
 

Top 20 Chinese companies that export pesticides to Africa during the stated period are shown in Table 3. A total of 105 kilo tons products are recorded, with a volume share of 54.6%. The export value from these top companies is $31.2 billion, with a share of 48.7% of the total. Among these companies, export values from Wynca, Nanjing Red Sun, Sichuan Leshan Fuhua Tongda, Zhejiang Zhongshan, Ningbo Sunjoy Cropscience exceed $20 million. Among these companies, Wynca, Jinfanda, Fuhua Tongda, etc., are the main suppliers of glyphosate. But due to the singleness of the product, it is much impacted in 2015 by the market condition. Compared to 2014, both the volumes and prices of the products from Wynca and Jinfanda decreased significantly by32% & 71%, 28% & 62%, respectively. Looking at the huge challenges that traditional trading is facing, Wynca started its strategy shift as early as 2009. It purchased 70% share of Ghana Sunshine Agric, which is a start to develop the local brand and channels in Western Africa. The sales of Sunshine Agric increased 10 times during the past 5 years. Such local operation strategy has surely provided reference for more companies who are considering strategic transformation. Currently Wynca is expanding this business model into more Africa countries.