German crop protection market down 7.4% in 2018

The downward trend of previous years in the German crop protection market continued in 2018. As of 31st December, 2018, the market’s net domestic sales totaled €1,282 billion, according to a recent report published by the German Crop Protection Industry Association (IVA).

These figures highlight a year-on-year decrease of 7.4% in direct business between the industry organized by the IVA and the crop protection wholesale trade sector. The market level that year fell below the figure in 2011, with net domestic sales of €1,291 billion.

The world crop protection market*

The global crop protection market recorded sales of US$56.5 billion in 2018, increasing by 5.2%, equivalent to €47.881 billion, an increase of 0.5%. The share of the world crop protection market of NAFTA (USA, Canada and Mexico) was 19.6%, while Latin America accounted for 23.8%, Europe (EU-28) for 22.6%, APAC for 30.2% and MEA for 3.8%.
(* preliminary result, Source: Phillips McDougall)

The German crop protection market

From April, 2018 was characterized by a drought not experienced since the start of weather records. Northern and eastern Germany, in particular, suffered. Only areas south of the Danube and the south-west experienced normal rainfall. Arable crops survived the winter of 2017 without winter damage, but the harvesting of winter crops was delayed by the late spring. The pressure caused by diseases on grain crops was rather low compared to long-term trends.
Herbicide sales fell by 4.4% to €568 million. The use of cereal herbicides in spring was higher than in the previous year. Autumn treatments lagged behind those of previous years due to the persistent drought. The market for beet herbicides increased overall by 2% to 3% due to an increase in acreage and higher market prices. The market was characterized by product shortages of leaf-active beet herbicides and the subsequent high demand. The corn herbicide market grew with the increase in corn acreage by around 3% while the rapeseed herbicide market dropped significantly. On the one hand, acreage significantly decreased while stocks were often slow to respond. In the north and east of the country, more than 10% of rapeseed crops were broken down.

Fungicide sales declined by 12.3% year-on-year to €499 million. The market value of grain fungicides dropped significantly to around 16%. The pressure caused by disease remained below the average of the previous few years during the entire growing season. Market volume significantly decreased, especially in the north. Early treatment appointments were canceled or reduced. From May onwards, the drought led to lower yield expectations and, consequently, less willingness to invest in crop protection. The use of fungicides on rapeseed dropped noticeably. The reduction measures and early protection efforts against fungi declined. In addition, the increase in generic product offerings depressed market value. The market for potato fungicides was below the previous year's level. Differential mushroom pressure caused striking regional differences. In the north, the drought led to greatly reduced applications while in the south, this fell only slightly, confirming that farmers make decisions based on the damage threshold principle and utilize crop protection in a targeted manner.

Total insecticide sales totaling €132 million was 3.1% higher than the previous year. The rapeseed insecticide market fell slightly in spring 2018. The treatments conducted during autumn sowing were more intensive than in 2017. The market for cereal insecticides rose in spring 2018, and winter cereal seeds also had to be treated intensively against aphids in autumn.

Sales of other crop protection products, such as growth regulators, rodenticides and molluscicides, decreased by 11.7% to €83 million. The growth regulator market shrank by almost 10% compared to the previous year. Due to cool weather in February and March 2018, early treatments were no longer necessary and the intensity of use decreased overall. In addition, price cuts again led to market losses in this submarket. Molluscicide sales declined as due to the continuing drought, the number of snails significantly dropped. Therefore, fewer snail baits were used in autumn 2018.

The wholesale inventory

Wholesalers' crop protection products inventories rose by 3.8% as of 31st December, 2018, to €355 million compared to 31st December, 2017. The inventory buildup affected fungicides and other crop protection products while herbicides and insecticides declined.

Plant protection products for homes and gardens

Plant protection products for homes and gardens generated sales of €60.9 million in 2018, which was almost the same level as the previous year with €60.6 million. This figure is based on the gross prices of manufacturers.

Herbicide sales were down significantly year-on-year at €22.4 million, compared to €25.9 million in 2017 and falling behind insecticides.

Insecticides generated sales of €24.1 million, an increase of 17%. Despite an extremely dry summer, molluscicide sales increased slightly in the past season totaling €8.4 million, compared to €8.0 million in 2017.

Sales of fungicides was consistently low at €6.0 million, a slight decrease of some 4% compared to the previous year with €6.2 million.

The comparatively low use of herbicides and fungicides reflects the infestation situation in the hot, dry summer of 2018, showing that, contrary to widespread prejudices, amateur gardeners practice responsible crop protection.