Recently, AgroPages released the Ranking List of Top 20 Global Agrochemical Companies for FY2020. According to the list, 15 enterprises realized growth in sales in FY2020. These included 10 enterprises that achieved double-digit growth. Total pesticide sales of the top 20 enterprises in FY2020 stood at US$61.8 billion, an increase of 2.9% YoY. Sales of the top four agrochemical players made up nearly 60% of the top 20; and the top 11, which surpassed $1 billion for each enterprise, constituted almost 90%. Eleven out of the top 20 are Chinese companies, with their total sales being $22.7 billion, 37% of the top 20. Sino-Agri Leading Biosciences Co., Ltd., the only newcomer to the list, ranked first in sales growth rate among the 20 with a growth of 53.1%.
Most enterprises have witnessed increases in both sales volume and price of their pesticides. Still, they were hit by the exchange rate volatility, primarily the depreciation of Brazilian Real, and their sales performance was affected to varying degrees by multiple factors such as adverse weather, agricultural product prices and COVID-19.
M&A Synergy Effects Face Multiple Tests, with Innovation Products Remaining Important Drive for Sales Growth
First and second-tier firms have finished the business restructuring after the M&A up to now. However, related business growth was slightly anemic because of unfavorable exchange rates, bad weather and COVID-19 on the synergy effects.
In 2020, Syngenta vaulted over Bayer to the top with $11.208 billion in pesticide sales, an increase of 6% YoY. Its sales volume and price increased by 12% and 3%, respectively. That Syngenta Group realized sales of $23.1 billion and an increase of 5% YoY was due to its robust business growth, price increase, alongside successful function cost control. Syngenta Group successfully managed the impact of the COVID-19 pandemic and related macro-economic headwinds, particularly the need for incremental inventory and logistics to facilitate higher sales and overcome the effect of weaker currencies.
The pesticide sales of Bayer Crop Science slipped below $10 billion to $9.986 billion, a decrease of 3.7% YoY. The year 2020 witnessed an outright decline in the sales of all its pesticide products. Among them, sales of herbicides stood at €4.74 billion, a decrease of 7.0% YoY. The decline in sales at herbicides was due in particular to a loss of registrations in Europe / Middle East / Africa and North America. Business in North America was also impacted by shifts in demand for selective herbicides into the prior year. However, the firm expanded our business in Asia / Pacific and Latin America. Besides, the sales of fungicides and insecticides fell by 2.9% and 5.4% YoY to €2.639 billion and €1.37 billion, respectively.
In 2020, the pesticide sales of BASF Agricultural Solutions decreased by 1.2% to $7.036 billion. Its sales in South America, Africa and the Middle East plummeted, but its sales volume and price rose by 5% and 2%, respectively. Currency led to 9% of the adverse effects.
The pesticide sales of Corteva was $6.451 billion, an increase of 3.1% YoY. The sales volume and price of the company’s pesticide products increased by 7% and 4%, respectively. However, the adverse effects of exchange rates constituted 7% and product mix 1%. Corteva’s sales of new pesticide products reached $1 billion, up 35% from the previous year. Its driving forces came from the following products: herbicides Enlist (dicamba), Arylex (halauxifen-methyl) and Rinskor (florpyrauxifen-benzyl), as well as the insecticide Isoclast (sulfoxaflor), etc.
The five companies ranking fifth to ninth contributed to 28.4% of the total sales on the list with $18 billion. After selling its South American business to the Japanese company Sumitomo Chemical, Nufarm suffered a significant decrease of 31.7% in pesticide sales. On the contrary, this helped Sumitomo Chemical realized a 25.6% increase in pesticide sales. The other companies witnessed growth in the sales performance to a different extent.
UPL rose by 4.5% to $4.662 billion in pesticide sales, edging out FMC to gain a fifth place on the list. Overall, the company performed well during the reporting period, with rupee sales increasing in all regional markets to varying degrees and India showing the most robust growth, up 22% YoY.
FMC pesticide sales were $4.642 billion, up 0.7% from last year. Insecticides, as the top product category in the company (proportion: 61%), realized $2.83 billion of sales, followed by herbicide (26%), fungicide (6%), and others (7%). It was noteworthy that the sales of the two bisamide insecticides Rynaxypyr® (chlorantraniliprole) and Cyazypyr® (cyantraniliprole) totaled $1.8 billion, driving FMC’s performance growth substantially.
Pesticide sales of ADAMA, the subsidiary of Syngenta Group, rose by 3.5% YoY to $3.738 billion, ranking seventh on the list. The robust growth in the fourth quarter drove ADAMA to achieve record-high sales in 2020. The Company saw its strongest growth over the year in the emerging markets of Latin America and the India, Middle East and Africa region, as well as in APAC. Its performance was further bolstered by various acquisitions completed in 2020, including in Greece and Paraguay. Herbicide products fell into its top product category among the business of all plant protection products of ADAMA, with sales of $1.707 billion in 2020, 45.7% of the total sales of all plant protection products.
The sales of Japanese Sumitomo Chemical, ranking eighth on the list, increased exponentially by 25.6% YoY in FY2020 to $3.235 billion. The company officially completed the acquisition of the South American business of Nufarm in April 2020, contributing to its significant growth. The company’s sales in India were performing well, and plant protection products grew globally.
Nufarm officially divested its South American business in April 2020, causing its pesticide sales to drop significantly by 31.7% to $1.72 billion in FY2020. North America turned into its largest sales area after that.
Ten out of 11 Chinese Companies among Top 20 Realize Sales growth, and Their Sales Proportion of 37% is Expected to Hit New Highs
Ten out of 11 Chinese companies among the top 20, excluding Nanjing Red Sun, realized sales growth in 2020. Total pesticide sales of the 11 firms reached $22.7 billion, constituting 37% of the top 20. Following the first and second-tier firms, some Chinese agrochemical enterprises also embarked on M&As. Industrial concentration is poised to rise, Chinese agrochemical players to expand, and sales shares in the market to hit new highs.
Yangnong Chemical’s pesticide sales in 2020 rose by 13% YoY to $1.413 billion, ranking 10th on the list. Due to the research, production and marketing integration model, this company maintained its stable development by breaking new ground by virtue of its large-scale production, effective marketing, lower costs and higher effectiveness. Youjia, the subsidiary of Yangnong Chemical, acquired a 100% stake in the Baoye Chemical in January 2020 and included the company in its consolidated financial statements.
Shandong Weifang Rainbow Chemical saw an increase of 20% YoY to $1.056 billion in its sales thanks to the six key advantages below: a unique business model to achieve “the switch from global ‘made in China’ to the ‘globalization of Chinese brands’”; clearly formulated and firmly implemented strategic plan; professional, dedicated core team with international perspectives; advanced manufacturing driven by R&D and innovation; extensive global marketing network; and complete industrial chain. Rainbow successfully went public on the Shenzhen Stock Exchange in July 2021. It will significantly improve its cost control and global layout.
Sino-Agri Leading Biosciences, the only newcomer to the list, ranking 12th with $963 million of pesticide sales and a growth rate of 53.1% YoY. The company integrated Nanjing Red Sun international operation resources in the first half of 2020 and set up Sino-Agri Red Sun to further consolidate its global operational strength. The three core competitive edges of market scarcity, extensive channels and continuous R&D fueled the company’s growth.
Nutrichem’s pesticide sales rose by 18% YoY to $893 million primarily due to its major advantages in product mix, R&D, market access and channels, production scale and favorable layout, and quality clients, resulting in a significant increase in its sales performance. In addition, the company’s triazone herbicides, diphenyl ether herbicides, and amide herbicides boasted strong market competitiveness, and their market share ranked in the forefront domestically.
The pesticide sales of Wynca, ranking 14th on the list, rose exponentially by 27.7 % to $881 million. The company’s agrochemical operation strengthened resource management during the reporting period, thus giving full play to the advantages of global platforms and channels. Wynca made every effort to seize overseas markets, filled in the market gaps in 6 regions such as Cambodia, Cuba and Belarus, and registered its subsidiary in Brazil to accelerate its globalization layout. Meanwhile, the company promoted the development of agricultural service platform, strove to be the leader in providing plant protection solutions, and covered more than 2.6 million mu of its UAV plant protection area. In addition to consolidating its advantages in glyphosate products, Wynca actively launched new products, enriched its product groups and provided solutions based on its pesticide mixture capability, contributing to cumulative sales of over 50 million yuan. In response to terminal demands, the firm developed 86 new products with sales volume of 3,407 tons.
The pesticide sales of Lier Chemical increased by 14.8% YoY to $673 million in 2020. The company effectively stabilized production and marketing by guaranteeing raw material supply and controlling costs against the backdrop of the COVID-19. Its performance was better than the previous year because of its higher sales volume and price. Glufosinate-ammonium, the company’s featured product, maintained a boom throughout 2020. Its demand is expected to increase further as glufosinate-ammonium tolerance new products developed by international companies are being promoted.
The pesticide sales of Hubei Xingfa Chemicals ranking 18th rose by 21.4 % to $635 million in 2020. According to the company, its positive development trend and registered marked growth in business performance benefited from the fact that it seized the opportunity after China effectively controlled the epidemic, and the recovery of its downstream demand to organize production and operation scientifically and focus on tapping potential to increase its efficiency when the COVID-19 bit the global economy hard in 2020. The company’s key projects accelerated; its technological innovation yielded remarkable results; its capital operation achieved positive outcomes; its standardized governance level continued to improve, and multiple superimposed factors greatly boosted its performance.
Kumiai Chemical Industry, ranking 15th, witnessed an 11.3% increase YoY in sales to $738 million in 2020. Sales of crop protection products in the Japanese market increased year on year. This was due to a significant increase in sales of the rice paddy field herbicide Effeeda and sales of its active ingredient, which commenced in earnest in 2019, as well as the inclusion of active ingredient for Bensulfuron-Methyl, which was transferred in the previous fiscal year. Sales to markets outside Japan increased year on year as i) sales of mainstay product Axeev, a herbicide for field crops, remained strong in the U.S.; ii) sales also remained robust in Australia, where its outstanding herbicide effect was reaffirmed; and iii) in Argentina, the problem of herbicide-resistant weeds became more widespread. The commencement of full-scale sales of Nominee, a rice paddy field herbicide at PI Kumiai Private Ltd., the Company’s subsidiary in India, was also a factor.
The sales of Nissan Chemical ranking 19th fell by 8.1% to $602 million. In the domestic agrochemicals segment, sales of "ALTAIR"(paddy rice herbicide) and “DITHANE”(fungicide) acquired in the third quarter of FY2020 contributed to sales. On the other hand, sales of "ROUNDUP"(non-selective leaf treatment herbicide) were firm, and shipments of "GRACIA"(insecticide) declined due to moderate insect pests ourbreaks. In the overseas agrochemicals segment, sales of "GRACIA","ALTAIR" and "PERMIT"(herbicide) were robust.
This article will be published in AgroPages '2021 Market Insight' magazine to be published this Oct.
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