ACECHEM: Open up the Indonesian agrochemical market with branded innovative products, technologies and services from a differentiated way of thinking and practicing

SUZHOU ACE CHEMICAL TECHNOLOGY CO., LTD. (ACECHEM) is a high-tech agricultural service company oriented to market and customer needs. Over the past 13 years’ intensive cultivation in the SouthEast Asian (SEA) market, ACECHEM has won the trust of local distribution partners and farmers/growers with precise market positioning, unique product structure and innovative services system, and has established good public praise on its brand. Extensive experiences in localization operations and management of agricultural business in SEA have simultaneously accumulated. While actively exploring, transferring and developing crop protection practices and distribution experience at home and abroad such as China and Viet Nam, ACECHEM casts on Indonesia market and set up a branch company for operation there in 2019.

As the fourth most populous country in the world and the largest in SEA, as well as the largest developing country and the only G20 member in SEA, Indonesia is also a traditional agricultural country, with agricultural output accounting for about 15% of its GDP, and agricultural employees accounting for 16% of the country's total population and 45% of total workforce. Located around the equator, Indonesia belongs to typical tropical rainforest climate and is also affected by the monsoons in the southern and northern hemispheres. The country therefore has sufficient sunshine, warm, humid and rainy climate and short crop growth cycle. There are many volcanoes in its territory, and the volcanic eruption brings a large amount of volcanic ash containing mineral elements, making the soil very fertile and suitable for planting a variety of agricultural crops. Rice, palm, corn, sugarcane, coconut, cassava, banana, potato, rubber, mango, chili, pepper, citrus, pineapple, onion/shallot, beans, coffee and cocoa have become the main crops grown in Indonesia. The output and output value of such crops in 2018 are shown in Figure 1.

Note: ¹⁾ Data source: FAO Stat; ²⁾ * indicates the crops with ratio of output-value to output no less than 0.5.

Figure 1  Output and output-value of main crops in Indonesia in 2018

As the world's second largest producer of rubber and palm oil, and the third largest producer of coffee and cocoa, Indonesia has limited arable land and rapidly increasing population, and its food is not yet self-sufficient. Its agrochemical market potential is huge. Taking pesticides as an example, Indonesia's current market size is approximately US$ 600 million, and more than 90% of pesticide raw materials, semi-finished products and finished products come directly or indirectly from abroad. However, the Indonesian market, in agrochemical case, is facing the problems such as old and outdated product structure, prevalence of counterfeit and illegal products, serious homogeneity of marketing and uneven level of pesticide application. In addition to economic and social problems caused by the COVID-19 pandemic in recent years, it is increasingly difficult to operate pesticide business there. After nearly three years of unremitting efforts and perseverance, ACECHEM has gradually concluded the strategy and mode of operation in this increasingly complex and potentially huge market in Indonesia, and finally walk out a small, refined and further transferable road of differentiated development.

Understand Market Demand and Industry Changes to Conclude Appropriate Operational Ideas and Mode

Although entered the Indonesian market relatively late, ACECHEM has paid special attention to good company image, market operation and channel accumulation since the beginning, and established and been maintaining long-term contact and communication with local agrochemical importers, dealers and distributors, as well as relevant government departments (Figure 2). In-depth exchanges with them on the supply and demand situation of agrochemical products, use technology and standard, quality control and improvement, and changes in crop planting structure have been conducted to timely adjust the development direction and gradually conclude appropriate operation ideas and mode. ACECHEM focuses on small but refined segments of crop protection in Indonesia, integrates and utilizes domestic and foreign technical resources and practical experience such as China and Vietnam, to improve end-users’ and local partners’ experience and benefits with branded innovative products and technical services at differentiated thinking and practice, and looks forward to growing together with them.

Figure 2  Investigation and exchange activities carried out by ACECHEM in Indonesia

Focus on Niche Market and Important Crops to Perfect Green Agrochemical Solutions

Relying on the practice and experience in crop pest management and green organic farming at home and abroad such as China and Viet Nam, ACECHEM mainly focuses on the niche market such as prevention and control of stubborn pests (diseases, insects & weeds), growth and development regulation (yield increasing) and nutrition management on high value-added and other important crops in Indonesia. Based on the output and output value of Indonesia’s main crops (Figure 1), ACECHEM has made in-depth layout and development preparations for the cultivation of crops with good development prospects, such as chili, pepper, onion and rice, and their plant protection solutions (Table 1). In order to meet the public's concerns on food safety and the requirements for pesticide residue limitation in agricultural exports, ACECHEM highlights on the research and development of high-efficiency and low-toxic green agrochemical products (especially biological agrochemical products). In addition, according to local actual conditions and end-users’ needs, differentiated new products are selected for registration and extension to continuously perfect the special solutions for niche market and important crops.

Table 1  Main crops and their plant solution targets ACECHEM focused on in Indonesia in recent years

Develop Innovated Products and Unique Technologies to Enhance Perceivability of Field Effects and Eventual Benefits

ACECHEM adheres to the concept that agrochemical products are first and foremost important agricultural production materials, and believes their inputs should really solve the concerns of farmers and growers (especially those urgent needs that actually exist but cannot be met) and bring real value and experience to them. As a Chinese agrochemical technology company, ACECHEM attaches great importance to the research and development China-innovated products, and has selected a group of new products that can truly solve end-users' concerns for intensive application extension.

In order to further highlight the value of innovated new products and improve farmers' perceivability of field effects and eventual benefits of pesticide application, ACECHEM has innovatively developed a series of new biostimulant products applicable for Indonesian market, which are based on PhotoSynthetic Bacteria (PSB) and their cultured secretions by using the newly developed ACEtec^TM unique technology (Table 2). Among them, the exopolysaccharide G-EPS secreted by the photosynthetic bacteria is a brand-new carbohydrate-based plant disease vaccine jointly developed by ACECHEM and the Plant Protection Institute of Hunan Academy of Agricultural Sciences (the patent relating to G-EPS’s production process and agricultural application technology has been authorized in China, while the international applications have been submitted), which can induce the plant’s own immune defense mechanism. Through multiple levels of signaling molecules and channels, it can regulate the processes including endogenous hormone release and accumulation, defense factor expression and secondary metabolite secretion in plants to achieve various effects such as growth stimulation, disease prevention and stress resistance, as well as yield and quality enhancement. ACEtec^TM unique technology is made through continuous system screening, ratio and process optimization by using cosmetic- and food-grade special surfactants and functional ingredients with various synergistic mechanisms (including organic matters and microelements), as well as advanced comprehensive formulating processes of facial mask and jelly. It is based on the theory of traditional Chinese medicine, and aiming at improving the harvest quality and yield of crops in the field. According to the result of field trial tests and demonstrations conducted by ACECHEM in multiple venues in the world, the products developed with ACEtec^TM unique technology have outstanding advantages such as perceivable effects, easy application, excellent integration, infinite vitality, mass output and low risk.

Table 2  ACECHEM-developed series products based on PSB and ACEtec™ unique technology

At present, ACECHEM has submitted a number of patent applications for newly innovated products in Indonesia, and launched two new products UPRISE^TM and ROBUST^TM based on the innovated molecules and ACEtec^TM unique technology. According to the result of field trial tests and demonstrations in Brebes, Medan, Garut, Makasar and Karawang in Indonesia from 2019 to 2021, UPRISE^TM and ROBUST^TM will make visible changes to crops (approximately 20~30 minutes after application minimum), such as accelerating the growth of onions/shallots and chilies, making the leaves greener, more lustrous and upright, the leaf wall thicker and the fruit larger and better taste, as well significantly enhancing the effects of disease prevention and stress resistance, outstandingly improving quality and increasing yield (Figure 3). Taking an example of UPRISE^TM with 500 times dilution for 4 times applications, the inhibition rate of dry tip on shallot leaves can reach more than 90%, whilethe tuber yield increases by about 30%. The newly developed S3 products based on bacterial exopolysaccharide and ACEtec^TM unique technology are also under research and development, small-scale field trial tests indicate that it has significant control effects against rice blast, dragon fruit canker and creeping spot (Figure 3), and vegetable soft rot. In addition, they have outstanding permeability and quick-acting effects, and be applicable for the management on stubborn and resistant diseases.

Figure 3  Field trial results of new products UPRISE^TM and ROBUST^TMof ACECHEM in Indonesia

Build Marketing Network and Logistic System to Ensure That Products Efficiently and Quickly Reach End-Users

ACECHEM preferably selects local partners (including dealers, distributors, agents and retailors) who have the same business development philosophy and a certain degree of financial strength, professional technology, warehouse and logistics, customer groups and team experience, and employ different mode of cooperation with them according to differentiated product positioning. (Table 3). For the distributors and dealers of different products, ACECHEM has established corresponding price system, as well as stocking cycle plan (generally it takes about 60 to 100 days from requirement claiming to export to the local store), payment collection and credit requirements. Through differentiated brand market planning and regional protection, ACECHEM has gradually formed a relatively complete sales network system in Indonesia. At the same time, ACECHEM has set up warehousing bases in Medan, Jakarta and Surabaya (Figure 4), and established long-term cooperation mechanism with local logistics companies. These have strongly supported the brand products developed by ACECHEM to enter retail stores and plantations directly or through dealing or distribution channels, and reach the hand of local farmers and growers efficiently and quickly (Figure 5).

Tabel 3  ACECHEM's differentiated distribution cooperation mode in Indonesia

Figure 4  Warehouse distribution of ACECHEM in Indonesia

Figure 5  ACECHEM's new products quickly reach distribution channels and end-users in Indonesia

Adhere to Field Demonstration and Agricultural Technology Extension to Expand Product Popularity and Stimulate Brand Vitality

Due to the relative lack of knowledge of agrochemical products and crop protection in both terminal and distribution levels in Indonesia agrochemical market, the field application and extension of branded agrochemical products and technologies are particularly important. As an agrochemical company focusing on innovation in crop protection solutions and technical services, ACECHEM is committed to bringing the crop protection experience at home and abroad such as China and Viet Nam to Indonesia in the form of field demonstrations and agricultural technology extension. In close cooperation with local partners, ACECHEM has set up extension supervisors and specialists by region, who are responsible for the publicity and implementation of product field demonstrations and agricultural technology extension activities (Table 4), as well as the collection and feedback of market changes, farmers' concerns and application situation. ACECHEM maintains regular contact and interactions with farmers and retailers, through various online and offline activities such as field demonstrations, experiencing visits, publicity explanations, exchanges and seminars (Figure 6), to enhance product popularity and stimulates brand vitality, and eventually deepen end-users' trust and confidence of the company.

Table 4  Demonstration and extension activities of ACECHEM in Indonesia

Figure 6  Demonstration and promotion activities of ACECHEM in Indonesia

Innovate Service Mode of Product Technology to Improve End-Users’ Experience 

Taking agrochemical products as the carrier, ACECHEM feeds the core needs of end-users through continuous technology development and upgrading, and at the same time highlights improving their experience through service mode innovation. While constantly researching and developing new products and corresponding new technologies to conduct field application demonstrations and agricultural technology extension, ACECHEM employs the concepts and methods of modern agriculture to boldly innovate service mode. One-stop service including crop planting technology training, early warning and monitoring of biological disasters, field management and application services (aerial applicaiton and manual service), and agricultural product marketing support are gradually carried out for end-users, so that farmers and growers can take the experience of friendliness, usability and usefulness in the process of using products and technologies to enhance the recognition and reliance on the ACECHEM brand, thereby further release more needs and desires.

YOUR CROPS, OUR CARE. In the Indonesian market, ACECHEM, as always, pays attention to the real needs of farmers and growers, closely follows and adapts to changes in the agrochemical market and crop planting industry, focuses on niche market, important crops and green solutions, develops efficacy- and benefit-perceivable products and unique technologies, builds high-efficient and fast marketing system and logistics network, adheres to branded field demonstrations and agricultural technology extension, innovates service models that can improve end-users’ experience, and shares the success and grow together with local partners.

In any case, ACECHEM will continue to integrate and utilize agrochemical technology resources and crop protection practical experience at home and abroad, lead experience improvement and cognitive change of partners, customers and end-users with differentiated thinking and practice, constantly perfect special solutions and innovate service ideas and methods for crop planting in the small and refined segment of crop protection market in SEA, drive terminal demand with branded innovative products and technical services, and promote local agricultural development with a modern agricultural mode.

Never forget why you started, and your mission can be accomplished. In the future, ACECHEM will continue to focus on the specific segment, develop and promote innovative products and technologies based on the real concerns of end-users, carry out application and extension from point to area and from small to large, gradually form unique crop-specific solutions which will not only bring value to farmers, but also bring new profit growth points to channel partners. It is believed that this kind of persistence that starts with the needs of users and ends at the satisfaction of users will be surely go steadily and further, and lead ACECHEM to a better future together with more cooperative partners.