Editors' note: Nitrogen is a critical limiting element for plant growth and production. Synthetic fertilizers are expensive and cause climate awareness, therefore, increasing the need for innovative commercialize products that can fix the nutrition for crops in the soil. AgroPages invited Marcus Meadows-Smith, Carlos Becco and Francys Vilella, who are a Nitrogen-fixing microorganism innovator, a local expert and a consult, respectively, to preliminary comment on the N-fixing market in Latin America.
Could you introduce the types of N-fixing products in the Latin American market? What are their technological breakthroughs?
Francys Vilella Director at CESIS
Francys Vilella has been working as
a consultant and in training for 17 years.
Francys: To answer your question, let us go back in the time when the biological fixation of nitrogen began in Brazil. In the 1960s, one of the world's most important scientists, Dr. Johanna Döbereiner, studied, in Brazil, biological nitrogen fixation processes that could be used in agriculture to decrease the use of mineral fertilizers. In the same decade, the Brazilian Soybean Improvement Program incorporated the study of nitrogen biological fixation (NBF) based on her work with Rhizobium bacterium. Therefore, soybeans could be produced with much lower dependence on mining fertilizers, which represented an annual savings of billions of dollars for Brazil. The subsequent spread of the use of nitrogen-fixing bacteria has expanded, and new research studies became important for the country, including on the relationships between grasses and diazotrophic microorganisms, and diazotrophic bacteria in endophytic symbiosis with non-legume plants. Over the years, more and more species and strains with biological fixation potential were discovered for various crops, such as soybean, corn, beans, sugarcane and others.
Nitrogen fixation is performed by both non-symbiotic bacteria, such as those of the genera Azotobacter, Beijerinckia and Clostridium, which fix nitrogen freely in the soil without performing symbiosis with plants so there is no physical interaction in order to benefit both, as well as by symbiotic bacteria of the genera Rhizobium, Bradyrhizobium and Azospirillum. These bacteria and plants form a physical interaction of mutual benefits, through the colonization by the root of the host plant. They then multiply and stimulate the formation of root nodules, where the bacterium converts free nitrogen (N2) into ammonia (NH3), which the host plant uses for its development. Seeds are generally inoculated with commercial products based on symbiotic bacteria, especially in poor soils and unfavorable microbiota.
Biological nitrogen fixation is an enzymatic process (nitrogenase), in which N2 is reduced to NH3 by the action of microorganisms. Although the atmosphere is rich in nitrogen, an important element for biological functions, it is not in the form that can be assimilated by eucariotic organisms. To make nitrogen suitable for assimilation, a triple bond must be created by the so-called nitrogen-fixing microorganisms that contain the nitrogenase enzyme, which is extremely sensitive to oxygen, as it can react with the Fe component of proteins. The protection of nitrogenase from the O2 molecule, which is not a problem for anaerobic bacteria but could become a major obstacle for aerobic species, such as cyanobacteria, free-living aerobic bacteria and bacteria that fix N2 in symbiosis with legumes. However, these microorganisms have ways of preventing the contact of O2 with the nitrogenase enzyme, such as through maintaining a high respiratorialmetabolism in the cellulas. Others are capable of producing extracellular polysaccharides, which limit the diffusion of O2 in the cells.
Marcus Meadows-Smith CEO at BioConsortia
Marcus Meadows-Smith is a successful
business leader who turned Chemtura
Plastics Additives around while
successfully growing that company's
agrochemical and pool chemical businesses.
He then took over a $20 million biopesticide
company that was losing money,
and in only 5 years, made it into
profitable company which was then sold for
(The case: Bayer acquired AgraQuest).
Biological nitrogen fixation in plants from the Leguminosae family occurs through symbiotic association with bacteria known as Rhizobium/Bradyrhizobium, which interact with roots to form specialized structures called nodules, where enzymatic reactions occur that convert atmospheric N2 into ammonia used by the host plant. In return, the plant provides Rhizobium/Bradyrhizobium carbon sources and creates a favorable environment for N2 fixation.
Soybean cultivation uses this mechanism the most, even by the history explained above. There are more than 500 inoculants registered in Brazil, and more than 50% are for soybean, with more than 75% being officially based on Bradyrhizobium for nitrogen fixation. There is also another significant part recorded for corn and beans.
Marcus: N-fixing products have been available for soybeans for decades. Soybeans and other legumes naturally fix nitrogen, but farmers have applied inoculants to help optimize this process for decades. Today, there is a new category of products based on microbes colonize roots and fix nitrogen for corn, wheat and other non-legume plants. BioConsortia’s nitrogen-fixing products are the best of these microbial products because they are based on robust spore-forming microbes that we have carefully designed for long storage life, and are formulated to be applied as seed treatments or in combination with fertilizers. Most importantly, our products consistently optimize synthetic fertilizer programs, adding yield and reducing synthetic nitrogen, so less nitrogen is lost due to runoff or volatilization.
Carlos: The most widely used N-fixing products in Argentina and other Latin American producers use Rhizobium bacteria to inoculate legumes, with soybean being the most important but is not the only one. This is a very common practice within the region. In Argentina, among the 16 Mhas planted last campaign, it is estimated that 90% was treated with Rhizobium bacteria, which capture N from the atmosphere and make it accessible to soybean plants, through a mutually beneficial relationship called simbiosis.
In the N-fixing industry, what are the advanced technologies?
Marcus: Advanced technologies include:
- Advances in genomics that enable us to quickly identify microbes that have the genetic potential to be nitrogen fixers, meaning we have a broad portfolio of varying microbes for varying crop situations.
- Gene programming improvements, through which our scientists can unleash the natural power of nitrogen-fixing microbes to increase fixation efficiency, even in conditions where other microbes turn off their fixing mechanisms.
- BioConsortia’s proprietary, patented AMS (Advanced Microbial Selection) process, which enabled us to discover novel microbes that can colonize corn and fix nitrogen, and can work either as gene-edited and natural forms.
The real agricultural environment is different in every Latin American country. For example, Argentina has fertile soil while Brazil's soil is poor and needs more fertilizers. Could you briefly discuss which countries or regions attract companies first and why? How do you operate in those countries or regions?
Carlos Becco Senior Advisor - Agribusiness
Carlos Becco has worked for multinationals,
such as Monsanto, for 18 years and held
the post of Lead of Ag Chem. He also served
Syngenta as the Commercial Unit Head of
Seedcare & Multipliers. In the microorganism
and N-fixing sector, he has worked for
Indigo as the Head of Argentina.
Marcus: All countries and soil types can benefit from BioConsortia’s nitrogen fixing microbes. We first plan to enter countries with the highest nitrogen needs for corn and wheat. This is a natural fit since our products can be applied as seed treatment and using standard agronomic practices. We will then move to the biggest markets for fruit and vegetables crops. We partnered with Mosaic to distribute our products for use on row crops, and our field trials in Latin America in the 2022 planting season will build on our field experiences on North American wheat and corn trials. We are seeking the best partner for distributing our products for fruit and vegetable crops, so they will likely be one to two years behind.
Carlos: You are right. There are many differences among Latin American countries, and there are many different criteria for deciding on how to start operating in those countries.
One of the most common is based on regulatory standards. Before starting a business in any LatinAm country, it is necessary to receive proper registration from local authorities. This process could be expensive and take up to three years. Establishing a proper regulatory strategy and setting key priorities in different counties are key to a successful commercial deployment strategy.
Natural gas is a major part of manufacturing Nitrogen fertilizers, and expensive natural gas results in expensive fertilizers. Is this a reason for why N-fixing products are getting popular in Latin America? What other reasons can increase the market potential in Latin America countries? How big is the market and how much will it expand?
Marcus: We see the current high cost of gas and nitrogen as only temporary. Instead, we see the major driver for switching to BioConsortia’s nitrogen-fixing microbes is the fact that nitrogen/ammonia is produced on the plant roots during the growing season, exactly when and where it is needed, meaning that growers can reduce the amount of synthetic nitrogen applied. And that is important, because nitrogen fertilizer production accounts for 3% to 5% of CO2 emissions as it is very energy intensive, and 50% of N applied to fields by grower is lost to the environment, either to the atmosphere or leaching into ground water, or through runoffs into streams, rivers and lakes and ultimately to oceans, where we now have 500 dead zones. Every action we take to make the use of nitrogen in agriculture more efficient can have a positive effect on the environment.
Carlos: Absolutely. The cost of fertilizers is the essential reason for the popularity of Rhizobium-based products in Latin America. In Argentina, the market for N-fixing products is estimated to be close to U$S100 million, and it is growing at a 14% compound annual rate.
Francys: Nitrogen synthetic fertilizers are an important source of nutrients for cultivated plants, especially NPK. In intensive agricultural systems, it is unthinkable to not use nitrogen synthetic fertilizers. Biological nitrogen fixation, especially symbiotic, as explained above, is one of the most important alternatives to the use of mineral fertilizers. Inoculation is a way of enhancing this process and increasing its efficiency. Inoculation is done by formulated products. Inoculants that are liquid or solid insums and based on microorganisms are applied on seeds or planting grooves, helping plants capture nitrogen from the air. Plants alone cannot take advantage of this process.
Coinoculation is an even more modern technology adopted by Brazil, which meets the requirement for high yields but with agricultural, economic, social and environmental sustainability. It is based on one microorganism known to be beneficial to plants, in order to maximize their potential, and combines the inoculation of seeds with nitrogen-fixing bacteria (N), Bradyrizobium/Rhizobium with Azospirillum, a bacterium known for its growth-promoting action in grasses.
Coinoculation offers several benefits such as increased root area, which allows greater utilization of fertilizers and favors plants in situations of water stress and increased productivity, due to the greater absorption capacity of nutrients and water by the roots, as well as greater vigor and nutritional balance, due to the better utilization of soil nutrients and fertilizers. It should also be noted that netter root development with Azospirillum also results in greater nodulation and, consequently, more efficient biological nitrogen fixation. This coinoculation technique reduces the use of chemical fertilizers, particularly nitrogen synthetic fertilizers, reducing the expense of insums. The associated Bradyrizobium/Rhizobium + Azospirillum increases nitrogen supply and offers additional benefits from the coinoculation with Azospirillum, including better plant nutrition and higher tolerance to abiotic stresses, such as drought.
In addition to coinoculation, other technological advances also stimulate market growth, including phosphorus-mobilizing microorganisms and the many possibilities that precision breeding innovation brings. Research results from the Brazilian Agricultural Research Company (Embrapa) reveal that there is a billion-dollar stock of phosphorus in soils in Brazil and the rest of the world. The problem is that this large reserve is not used by plants, so out of all fertilization thrown into the soil, only 30% of phosphorus is used by soybeans while the rest is retained in the soil and the plants cannot use it. Due to this, Embrapa has developed a microbial technology that facilitates the absorption of this nutrient by roots, which resulted in an increase in production of seven bags more soybean per hectare. An inoculant was developed for the solubilization of phosphorus contained in the soil, meaning that bacteria can help make the nutrient, which plants cannot get on their own, available.
The use of biological insums has been increasing year by year in Brasil. It is estimated that in the 2020/21 crop, the commercialization of these products, both biopesticides and bioinoculants, was worth some R$2.0 billion, with 20% being in the inoculant market. The strong continuous growth in demand for biological products indicates the consolidation of the use of these solutions, under the IPM concept adopted by growers.
This adoption is not only due to economic reasons, but it is also due to the fact that NBF minimizes environmental damage, while offering greater nitrous supply to the soil and improving its physical, chemical and biological properties and productivity, especially nitrogen-deficient soils.
In Brazil, considering the long-term adoption of this technology of more than 50 years, the Biological Nitrogen Fixation Program is a key factor in the success of the largest tropical agricultural base on the planet. For soybean, the most important crop for Brazilian agribusiness, biological nitrogen fixation is a very important strategy for reducing the high demand for nitrogen fertilization in legumes, which still has environmental benefits, assisting in the recovery of degraded areas, especially where the unsustainable use of the soil resulted in the loss of organic matter and productivity.
Because of the features of microbe products, it is hard to successfully operate a monopolistic product range. How do you deal with competition from locally produced N-fixing products and imported products?
Marcus: We believe our products will be significantly superior to first generation products, especially in terms of efficacy, consistency and in their seed treatment formulations. So, we look forward to working with local experts to serve Latin America’s growers.
Carlos: Following our experience of the soybean-fixing market and considering that we are talking about marketing living organisms, it has proven impossible to operate a monopolistic product range as you state. In the case of the Rhizobium experience in the soybean arena, marketing differentiation has been based mostly on formulations, as most of the strains used by the industry are the same.
I do expect that in the case of the corn-fixing market, there will be more possibilities to differentiate the offers of different companies.
How would you describe the up-downstream of N-fixing microbes industry? How will you shape large scale a company?
Marcus: Many of the first wave of nitrogen-fixing microbial products have been based on soil-applied products. Our first products will be available in seed treatment formulations, so they will remain stable on the shelf and on seeds and can enter the market through existing market channels, either via seed companies, seed conditioning companies or seed retailers.
We are a leading microbial R&D company, well-funded with around 50 scientists and over a decade of research using AMS for the discovery, improvement and development of superior microbial products. In recent years, we have added tagging and gene editing to truly unleash the power of our microbes, with superior performance and consistency. We have focused on developing the best products on the market, but we do not have a sales and marketing team. Therefore, our model is to partner with major players who have the expertise, experience and reach to serve growers’ needs across the region, highlighted by our partnership with Mosaic and ongoing discussions with other major players in the fertilizer and crop protection space.
Carlos: The foundation of the N fixing business is microbiology R&D. The first step is to identify the key microbes. Microbiology is so diverse that there are thousands of different strains of Rhizobium bacteria. Finding out the most effective strains is absolutely essential.
The Following step is to formulate the bacteria to facilitate and simplify farmers' usage.
You should not forget that we are manipulating living organisms that, to be effective, needs to arrive alive at farms. Considering the huge distances that are common in Latin America, it is important to develop formulations and packaging to make this possible.
Nowadays in the market, there is a wide range of technologies that enable shelf life pf as long as 120 days, so called ″long life inoculants.″
As the market continues growing, production efficiency and quality standards become more and more relevant. While we are producing literally living organisms, it is absolutely mandatory to maintain all operations under the most strict safety conditions to avoid the risk of contamination.
And finally, to deliver those products to end users, it is necessary to develop strong channel partnerships that provide proper coverage and services to all farmers at their production areas, which is quite a challenge in Latin America countries.
We know that globally, Azotic, Symborg, Indigo and others are providing N-fixing products and technologies. How have they performed in the market? What other companies that are not listed?
Carlos: So far I have described the soybean-fixing market. The corn N-fixing market is an exciting new opportunity that many companies, including the ones you have mentioned, are looking forward to developing. As mentioned above, most of those companies have already started the regulatory process. So far, no information has been shared regarding product outcomes. And I have no doubts that some local companies are also intensively exploring this market opportunity, such as Bioceres, which has recently acquired giant Marrone Bio Sciences, as well as other companies, like Indrasa or Ceres Demeter.
Francys: The market for such products in Latin America and, in particular, the Brazilian market are great opportunities for continuous growth in the history of adoption of this technology by farmers. There is always space for new species and strains, new forms of application, new combinations of microorganisms and more recently, even products based on new forms of genetic manipulation. There are always new companies entering the market that bring innovation to the sector. Startups play an important role in this, providing new technologies and even new business models. In Brazil, this is a thriving sector. According to Embrapa's Radar Agtech, the number of startups in Brazil in 2020/2021 grew 40% compared to 2019. This number encompasses all related solutions, not only for the bioinputs (bioinsumos) sector. For bioinput startups, the largest growth focuses on the B2C model, where companies, through their R&D, develop innovative products to meet growing market demand. However, from the start of internal projects to the final product are years of development and testing. Therefore, there is a special space for the B2B model, where the process from discovery to the end use product can be shortened. ProspectaBio is an example of this model, the startup uses the knowledge and tools of its own microbial collection to build customized products, to meet the growing demand for new products that increase bioinput B2B demand for nitrogen fixation, phosphorus mobilization and even drought tolerance.
What is the current regulation system covering N-fixing products?
Carlos: In Argentina and most Latin American countries, the regulatory system separates products based mainly on purpose. If the product improves nutrition, they are considered, from a regulatory perspective, as fertilizers, and if it controls pests or weeds, they are considered pesticides. Independently of being biological products, AND-fixing products are considered as fertilizers, taking one year to attain registration. Today, there is no preferential policies in place, even though some of them are under consideration.
Francys: In some Latin American countries, there is no legal framework that regulates the production, importation and marketing of nitrogen fixation inoculants. But Brazil, due to the importance of such products to its agriculture, has established regulations since the 1980s. Both producing and importing companies must be legally allowed in such categories to operate, and their products must also be registered at the Authority in charge, which is the Ministry of Agriculture (MAPA). Brazil also regulates the production, marketing and labeling of products, as well as their guarantees and quality. For products whose microorganisms have no history of registration in the country, there is a need to perform efficacy tests in Brazilian soil according to specific protocols before they can be registered. Quality control for all inoculants is also another very important and sensitive point for the Brazilian authority.
For inoculants based on Precision Breeding Innovation techniques, as well as MAPA, the Brazilian Biosafety Agency (CTNBio) must be involved in the regulatory process.