AgroPages-2018 Chinese Pesticide Exports Analysis - Southeast Asia-Agricultural news

Erwin Xue

Vice General Manager

From January to November 2018, a total of 1.2412 million tons of pesticides were exported from China, valued at $7.093 billion. The export volume decreased 7%, while the export value increased 17.4%. According to historical data, Asia is the largest territory of Chinese pesticide exports among the seven continents. Of the Chinese pesticide exports to Asia, Southeast Asian countries (10 ASEAN members) made up 62.5% of the export volume at 45% of the export value. Landing in Southeast Asia has become the Chinese brand’s first choice to go global, and it is therefore of great significance to analyze Chinese pesticide exports to Southeast Asia to address the important market.

From January to November 2018, Chinese pesticide exports to Southeast Asia amounted to $1.58183 billion in value (9.21% up YOY) totaling 362,530 tons in volume (1.2% up YOY). Among them, technical material amounted to $734.56 million (2% down YOY), totaling 114,580 tons (30% down YOY) and formulations amounted to $712.02 million (4.6% up YOY), totaling 215,530 tons (17% down YOY).

Country data of Chinese pesticide exports to Southeast Asia (Jan to Nov 2018)

Figure 1: Value-ranked Southeast Asian countries importing Chinese pesticides (Jan to Nov 2018)

Chinese pesticide exports to Southeast Asia decreased to the level of exports in 2016 (359,170 tons), but prices increased 46%, mainly attributable to the widespread price rise resulting from short supplies caused by the stringent environmental compliance regulations in China.

Table 1: Volume & value of Chinese pesticide exports to Southeast Asian countries (Jan to Nov 2018)

	Country	Export Value (Million USD)	Change	Export Volume (1,000 Tons)	Change
1	Vietnam	395.69	1.50%	70.97	-53.93%
2	Thailand	394.72	9.30%	116.01	-15.26%
3	Indonesia	358.04	11.37%	81.25	-8.14%
4	Malaysia	123.7	6%	28.71	-19.64%
5	Singapore	123.25	6.73%	11.27	6.90%
6	Philippines	97.02	22.76%	30.34	7.20%
7	Myanmar	55.47	15.92%	15.55	-6.88%
8	Cambodia	32.2	45.15%	8.14	35.53%
9	Laos	1.72	55.49%	0.28	59.60%
Total		1581.83	9.21%	362.53	1.22%

According to export data from January to November 2018, while comparing the volume and value changes since 2016, it was noted that Singapore has the most stable status with relatively reasonable volume and value increases, which are controllable. This is mainly attributable to the minor changes of chlorantraniliprole and cyantraniliprole exported from DuPont Shanghai, as these two products accounted for 41% of the total Chinese pesticide exports to Singapore.

Figure 2: Changes in volume of Chinese pesticide exports 2016-2018

Countries, which had increases in both volume and value, included the Philippines, Kampuchea and Laos, particularly Kampuchea, which relies on imported formulation products due to the lack of production capability, having become a favorite-emerging market among Chinese enterprises.

Other countries such as Vietnam, Thailand, Indonesia, Malaysia and Myanmar experienced an unexceptional decrease in volume but increase in price, especially Vietnam, where the import volume declined to the level of 2016, while the price level increased nearly 50% over 2016. AgroPages visited Vietnam some time ago and found out that local enterprises, big or small, would all wish to introduce new products. Customers in Vietnam said that the Vietnamese Ministry of Agriculture tends to ban pesticides failing to reach EU’s maximum residue limits. For instance, the use of acephate is prohibited already, and will be followed by the prohibition of more than 10 active ingredients including chlorpyrifos and fipronil. In the years to come, less and less compliant pesticides will be available, so there is an urgent need for the introduction of low toxic and safe crop-protection products. A local customer showed AgroPages a number of products, which have been validated, to be supplied from Korea, India and Italy. For example, the product ECOSPREAD from India, which is said to have an excellent osmotic effect, the botanical pesticide azadirachtin, an olive oil-based agricultural synergist, ningnanmycin and viral bioinsecticide from China. Customers in Vietnam proposed that AgroPages should provide information on the availability of worldwide novel products, which users in Vietnam are eagerly seeking.

Figure 3: Changes in value of Chinese pesticide exports 2016 – 2018

Analysis of top 20 Chinese pesticide export products to Southeast Asia

According to statistics, the export volume of Chinese pesticide technical exports to Southeast Asia from January to November 2018 was 114,580 tons, valued at $7.3456 million. Of this, 30% went to Vietnam, 27% to Indonesia, 15% to Thailand, 13% to Singapore, 11% to Malaysia, 2% to the Philippines and 1% to Myanmar (AWBA is the only company with formulation production capability). Kampuchea and Laos have no formulation production capability.

Of all the pesticide technical, glyphosate and paraquat accounted for 30% of the total value and 32% of the total volume. Of this, the paraquat export volume dropped sharply 50%, being China’s most drastically dropped export product to Southeast Asia, mainly resulting from the 53% decrease in imports from Thailand and 92% decrease in imports from Vietnam. In March 2017, Vietnam announced the prohibition of paraquat. Thailand set December 2019 as the deadline for the prohibition of paraquat. Besides paraquat, some other products in the top 20 Chinese pesticide export products to Southeast Asia are also banned in some Southeast Asian countries or are put at risk of prohibition, including glyphosate, chlorpyrifos, fipronil, 2,4-D, glufosinate, carbosulfan, imidacloprid and carbendazim. The export value of products at risk of prohibition accounts for 50% of the total Chinese pesticide exports to Southeast Asia.

Table 2: Volume & value of top 20 Chinese pesticide technical products to Southeast Asia (Jan to Nov 2018)

No.	Product	Export Volume/kg	Export Value/US$	Number of Country	Number of Exporter
1	Glyphosate	28,717,600.00	117,480,784.06	7	64
2	Paraquat	40,175,720.50	112,973,229.00	7	60
3	Chlorpyrifos	8,413,502.00	57,201,637.00	7	76
4	Chlorantraniliprole	374,150.00	41,701,087.00	1	1
5	Tricyclazole	1,409,240.00	16,860,568.00	4	28
6	Fipronil	169,690.00	15,712,039.00	6	49
7	2,4-D	5,385,657.00	15,283,008.98	4	17
8	Glufosinate-ammonium	486,525.00	12,006,667.66	6	17
9	Carbosulfan	922,200.00	11,823,166.35	4	27
10	Imidacloprid	436,852.00	11,795,361.00	6	61
11	Azoxystrobin	268,802.00	11,317,672.00	6	39
12	Butachlor	3,291,370.00	11,032,377.00	5	24
13	Difenoconazole	334,197.00	10,725,940.00	6	51
14	Nitenpyram	250,250.00	9,719,920.00	2	20
15	Cyantraniliprole	55,000.00	8,854,400.00	1	1
16	Fenclorim	429,505.00	8,605,602.00	5	21
17	Emamectin	70,221.00	8,317,224.91	4	36
18	Cyhalofop-butyl	251,775.00	8,024,780.00	5	26
19	Carbendazim	1,420,685.00	7,701,575.56	6	9
20	Paclobutrazol	421,700.00	7,104,272.97	4	29

With regard to formulations, the export volume of Chinese pesticide formulations to Southeast Asia from January to November 2018 was 215,530 tons (17% down YOY), valued at $7.12 million (4% up YOY). Of this, 34% went to Thailand, 21% to Vietnam, 17% to Indonesia, 10% to Philippines, 6% to Myanmar, 4% to Malaysia, 4% to Kampuchea and 3% to Singapore. For future exploration of the Southeast Asian market, Chinese enterprises need to give priority to either the joint development of high-efficient formulations in collaboration with local strategic partners or incorporation of formulations into excellent local platforms.

Spring Gu, the executive director of Thai Agrotrade, Thailand’s long existing local company, told AgroPages that Thailand is also faced with drastic industry changes over the last two years. Thai Agrotrade has worked on conventional pesticide trading for more than 10 years, being a partner or exclusive agent of lots of Chinese enterprises. In the past, Thai dealers could make a 30%-50% gross profit at each level of agency service, but nowadays, the sharp price rise of Chinese pesticides has put great pressure on the profit margin of dealers. In the meantime, the DOA of Thailand has sped up its progress over the prohibition or restriction of conventional pesticides. For example, by December 2019, paraquat and chlorpyrifos will be in principle prohibited completely; the use and import of glyphosate will also be restricted. At the same time, the existing distribution channel of Thailand is faced with a reshuffle. However, just because of this, such a long-existing local company with local business experience is provided with new opportunities for the further development of sales channels.

The first important advantage of this kind of local company lies in its well-established supply channels built with Chinese or Indian enterprises; also, these companies have gained rich resources to commit to registration proceedings. Furthermore, they have a good understanding of local crop distribution features, farming systems, grower’s pesticide application practices, and insect and pest problems on local crop fields. If strengthened research and development can be conducted to work out total solutions customized to local crops, the chance to shape a successful brand image in the local market will be very big. It is the intention of local companies to establish a kind of market access platform, where various international top products are brought in and integrated. Spring says that Thai Agrotrade already started the deployment of sales channels three years ago, now in possession of a work team with 75 staff members. The company is currently preparing to set up research labs, and is scheduled to start the comprehensive development of a terminal market from 2019.

Thailand is a just an example of the Southeast Asian market. With the increased difficulty in research and development of proprietary products, the average profit margin for each level of agency service within the industry is diluted constantly. Here is a message to Chinese companies: Roll up your sleeves & get to work.

Table 3: Volume & value of top 20 Chinese pesticide formulation products to Southeast Asia (Jan to Nov 2018)

No.	Product	Export Volume/kg	Export Value/US$	Number of Country	Number of Exporter
1	Glyphosate-isopropylammonium 41% SL	57,209,485.58	96,492,961.00	9	95
2	Glyphosate-isopropylammonium 62% SL	15,208,820.00	34,436,484.00	5	20
3	Glyphosate-isopropylammonium 480g/L SL	18,660,136.65	32,572,791.00	6	4
4	Abamectin 1.8% EC	7,477,907.97	23,041,717.00	9	95
5	Mancozeb 80% WP	5,155,316.00	19,664,429.00	8	39
6	Glyphosate 30% SL	9,940,990.40	15,707,610.00	9	51
7	Ametryn 80% WP	2,621,020.00	14,344,118.00	6	15
8	Acephate 75% SP	2,202,245.04	12,645,139.00	7	22
9	Emamectin 5% WG	910,580.00	11,060,830.00	8	51
10	Paraquat 200g/L SL	4,186,534.42	10,573,367.00	6	21
11	Ametryn 80% WG	1,579,240.00	9,871,501.00	2	7
11	Niclosamide ethanolamine 80% WP	910,848.40	9,101,583.00	8	27
13	Imidacloprid 70% WG	318,724.00	9,088,547.00	7	36
14	Fentin acetate 45% WP	599,958.00	8,980,566.00	2	6
15	2,4-D-dimethylammonium 860 g/L SL	3,636,909.90	7,951,419.00	7	17
16	Diuron 80% WP	1,258,815.00	7,852,869.00	7	30
17	Cypermethrin 5%+Chlorpyrifos 50% EC	1,327,043.69	7,302,121.00	6	34
18	Atrazine 80% WP	1,780,325.00	6,855,318.00	6	15
19	Fipronil 80% WG	74,800.00	6,284,588.00	3	9
20	Fipronil 50g/L SC	889,927.53	6,202,940.00	7	31

AgroPages is acting as a bridge between industry counterparts all over the world, with experience in presenting various excellent products to worldwide users and helping Chinese enterprises locate the right local partners.

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