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Chemical Agrosava: A reliable regional partner in Serbia with superior production, professional service, and stable profitabilityqrcode

Apr. 27, 2021

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Apr. 27, 2021

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Serbia has fertile land, abundant rainwater and good crop growth conditions. Agriculture has always been one of Serbia's traditional advantageous industries. Although vulnerable to weather changes and fluctuations in output and exports, agricultural products have always been the main source of Serbian exports. In 2020, despite the impact of COVID-19 panpidemic, Serbia’s agricultural exports reached a record US$4.1 billion. 


20181228142555ap44.pngIn this interview, we invited Chemical Agrosava(www.agrosava.com), a leading local agricultural inputs distribution and production company in Serbia. The company is the preferred partner of many multinational companies entering Serbia. In its thirty-year’s development history, Chemical Agrosava has grown rapidly, and with its high-quality production capacity, professional market ability and stable profitability, it has fully served the local agricultural producers. In the following content, Mr. Milan Sudimac, agrochemical project manager of Chemical Agrosava, will tell us the story of Chemical Agrosava and introduce the current development situation of the Serbian market.


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Milan Sudimac (msudimac@agrosava.com), Product manager for agrochemicals of Chemical Agrosava.


AgroPages: Please explain the historic development of Chemical Agrosava and its main business segments.


Sudimac: Chemical Agrosava was founded in 1990 in Belgrade. From the very start, the guiding idea was the creation of a company specializing in plant protection. This idea led to partnerships and close cooperation with several multinational companies, which are continuing to this day.


In 1996, our company started its production in a small plant in Šimanovci, 25 kilometers (km) from Belgrade. Today, at this location, there is one of the most modern factories in the eastern part of Europe for the formulation of granular (GR, WDG), liquid (SC, EC, SL, FS, OD and EW) and powdery (WP) pesticides, as well as a seed processing center with seed dryer and seed storage facilities with a capacity of 5,000 pallet places, along with a plastic packaging production plant, a printery, laboratories, and a distribution center for pesticides with an area of 1.6 hectares (ha).


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The production site of Chemical Agrosava


In 2004, a breeding house, “AS Hibridi,” was established within Chemical Agrosava, which specializes in corn selection and breeding and, from 2016, in the selection and breeding of wheat. During this relatively short period, more than 60 corn hybrids were registered and sown, not only in Serbia but also on increasingly larger areas from France to Iran. We were the first to register hybrid wheat and made considerable progress in terms of cereal production.


Since 2005, we introduced the integrated quality system (ISO 9001), environment protection system (ISO 14001) and occupational health and safety system (ISO 18001). Since 2014, our seed quality testing laboratory has been accredited in accordance with SRPS ISO/IES 17025:2006 for sampling and testing cereal seeds and industrial and fodder plants. 


Chemical Agrosava meets the highest global standards in the production of pesticides, water-soluble fertilizers, foliar nutrients and plastic packaging, as well as in the production and processing of all plant species, and the provision of services related to the formulation, packaging and storage of pesticides.


Today, Chemical Agrosava has a team of over 200 employees, and more than 40% are highly educated experts in various profiles, such as agricultural engineers, plant protection engineers, economists, chemists and technologists. With their knowledge, experience and advice, they create a safe foundation for every agricultural producer. As a result, Chemical Agrosava has received many of the most prestigious awards, including the Golden Gazelle Award in 2016 as the fastest growing company in Serbia, the Belgrade Winner Award, the Golden AAA Credit Rating, and the Environmental Respect Award from DuPont in Wilmington, USA.


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Some of the awards that Chemical Agrosava receives


The knowledge we possess enables us to make products of superior quality and realize the concept of optimal protection, which is a combination of professional and commercial factors and excellent products and advice for timely application. Our mission is to be a regional leader, and the only way to achieve this is to help others grow together with us.


AgroPages: Please present the agricultural characteristics of Serbia?


Sudimac: Geographically, Serbia has an exceptional position, making it ideal for exporting agricultural products. About 70% of its total territory is agricultural land, while 30% is covered by forests, and arable agricultural land account for about 4 million hectares.


In terms of production, the northern part of the country above the rivers Sava and Danube is flat and mainly dominated by crop production, including for corn, wheat, sunflower and soyabeans. The southern part of Serbia is equally important for the production of corn, but is mainly oriented towards the production of fruits and vegetables. Corn and wheat are the major exported farm products, while apples, raspberries and cherries are the main fruits grow. Agriculture in Serbia accounts for 10% of GDP.


AgroPages: What are the major issues facing the country's agricultural development?


Sudimac: The trend that has been happening for the last two decades is the consolidation of property by large companies. Smaller producers are faced with the placement of goods without adequate prices, and they are not able to establish new productions. Subventions exist, but these are not targeted correctly. Most agricultural producers have a significant percentage of land, some 40%, leased for one year. All of these factors do not encourage them to invest in their businesses in the right way. We are also facing climate change, which makes only every fourth or fifth year profitable.


AgroPages: Please Introduce how do Chemical Agrosava cooperate with multinational companies  and provide the best products and services to local growers?


Sudimac: Agrosava is a family company that started its business more than 30 years ago. Initially, it distributed the agrochemical products of multinational companies. Later, competing companies placed more and more pressure on generic products, so we were forced to follow this trend. Our agrochemical factory in Šimanovci has formulated the most modern agrochemical products from the very start. Our quality was quickly recognized by multinational companies, so we were 

able to quickly establish partnerships. 


Chemical Agrosava has been a pillar of many multinational companies. Since we are profitable, foreign companies can be certain that they can cooperate with us in the long-term. Also, purchased goods will be appropriately placed on the market. Our well trained professional staff work on the reputation of our products and, therefore, on the reputation of the companies that own those same products. The possibility of repackaging products into formats that are adapted to the market also enabled us and the companies we work with to progress.


Our cooperation is mainly reflected in the service repackaging and formulation of almost all liquid formulations. Since 2018, a plant for the production of WG was opened, both for the company’s own requirements and for the needs of other companies in the area. We are currently working with Bayer, Basf, Syngenta, Upl and few other smaller companies.



AgroPages: In terms of pesticides, what are the main products currently used by Serbian farmers?


Sudimac: It can be said that the range and application of pesticides are very diverse. Almost all pesticides from different categories are available. Since maize production dominates, the use of herbicides is also very widespread. The products of domestic and foreign companies are used equally. Over the last 10 years, Bayer Cropscience has had a slight dominance in terms of herbicides used on maize. During that period, they are the only company able to offer more recent molecules, which was recognized by end users.


The former dominance of the combination of s-metolachlor + terbuthylazine was replaced by thiencarbazole methyl. Nicosulfuron is still indispensable in the later stages of grass weed control. Due to the appearance of resistance to this active substance, tembotrion now plays an increasing but only cosmetic role.


In sunflower and soyabean crops, for grass weed control, fluazifop-P-butyl and cletodim are used equally.


AgroPages: While the compounds patents of multinational companies are being successively expired, does Chemical Agrosava have a strategic plan for these products?


Sudimac: In addition to the intensive exclusion of patented compounds, multinational companies, in most cases, have adequate replacements to offset profits in the near future. Generally, new compounds are performing less well but are more expensive for the end user. Generic companies are using this opportunity and offering identical products of certain quality at much lower prices. In order to reach consumers, domestic and foreign companies are racing to offer lower price, because they see this as the only way to sell and be present in the market.


The segment prioritized by Agrosava is the “Development and Registration Department.” We have identified products that have potential in certain niches. We also adapted types of formulations that are environmentally friendly. We segmented the market by adjusting the packaging formats to reach the end user. Technical support is always provided, including specialists in certain areas whose primary task is the transfer of knowledge and experiences in facilitating the distribution of goods.


AgroPages: How do you assess the efficiency and acceptance of new products and technologies in Serbia, such as biopesticides and bistumulators?


Sudimac: In line with the future restrictions on many active substances, it is inevitable that the use of biopesticides will take its place. They are currently present but with modest potential. It is extremely difficult to get a top quality product, even with existing pesticides. The application of biopesticides requires additional knowledge to utilize their full potential. The complete implementation of this type of production is possible, but I think it will take a long time to adapt to this type of production. The question is how to find a balance between biopesticides and their lower efficiency, higher prices and the difficulty in obtaining first class products. The price of agricultural products is, therefore, expected to rise rapidly.


AgroPages: It is known that the chemical industry is the leader in Serbia as a category. How is the social environment for agrochemical production in recent years? How does Chemical Agrosava manage its production and raw material supply chain?


Sudimac: Until 1990, the chemical industry had the tendency for growth. But later, with the privatization of socially owned companies common in the chemical industry, it experienced complete closure in a short space of time. The synthesis of substances stopped and the role of the suppliers of finished products was taken over by multinational companies. 


Today, only two companies focus exclusively on the formulation of products with raw materials mainly coming from China. The cost price of these products is related to the purchase price of raw materials from the Far East. The potential closure of many plants in China will significantly affect supply in the European finished products market. It is expected that all this will lead to a significant increase in the price of pesticides, because most of products of foreign companies will be marketed.


Chemical Agrosava has been produced some 4,500 tons of agrochemical products over the last few years. This quantity does not include products and activities used by the company for the needs of its business partners with whom we are in constant cooperation, such as Bayer, BASF, Adam and Syngenta. Our production capacities are extremely large, exceeding the production we are currently marketing. Our packaging formats for liquid products range from 5ml to IBC (1000 liters), and from 1.25g to large bag packaging for granular and solid products. 


It can be said that our strict production control, whether input, process and final, of all active and auxiliary substances, as well as our packaging of semi and finished products,  while adhering to all relevant standards in the profession, enabling us to achieve significant production flexibility and dynamics. 


In terms of the supply chain, we focus on timely planning, acquisition and procurement and secure and reliable logistical support. We plan the production and sales season several years in advance and direct production activities 3 to 6 months in advance, to ensure the availability of everything necessary for safe and quality production and the placement of our products.


AgroPages: Please introduce the market development of crop protection distribution in Serbia? Are there any changes to this market structure and if so, what are the reasons? As a leading company in terms of production and distribution, how does Chemical Agrosava adjust to this market trend?


Sudimac: Compared to other markets, Serbia is not so interesting. However, we are increasingly facing a situation where many powerful companies want their share of the cake in such a market. In addition to modest areas compared to other European countries, there is still interest in selling certain items and services. It is estimated that the sales value of pesticides in Serbia ranges from EUR100 million to EUR120 million.


In recent years, we have witnessed many changes to the ownership structure, which are mainly integrations at global level that will surely leave a deep mark. The pressure existed even without previous integrations. Nowadays, smaller companies, such as Chemical Agrosava, are forced to adapt by offering different agribusiness services, meaning the sale of high quality products, better and timely distribution, the creation of strong interpersonal relationships, covering new market segments, employing professional associates who will always give more information, and intensifying our media activity with the right focus on a specific category of users. Since most young producers have a different approach, we try to identify their needs and work together to reach an optimal solution.


To achieve better risk management, we offer products from other segments not related to pesticides to the market. Although the products of multinational companies are undoubtedly top quality, they are often not appropriate for our agro-ecological conditions. For example, we stressed that herbicides that applied are not compatible with our weed population, and, therefore, they have certain shortcomings, along with fungicides that are only effective on a narrow spectrum of diseases. With this in mind, we are constantly looking for new solutions and combining different active ingredients to offer more complete products.



To know more about Chemical Agrosava, please visit: www.agrosava.com


Contact:

Milan Sudimac, Product manager for agrochemicals, msudimac@agrosava.com

Mirko Štajn, Project manager, mstajn@agrosava.com




Source: AgroNews

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