AgroGalaxy, Bayer to terminate partnership in pesticide distribution

AgroGalaxy Group and Bayer have terminated their commercial partnership for pesticide distribution in the "Crop Protection" segment. 

With this decision, the companies cease operating in the Brazilian states of Paraná, São Paulo, and Minas Gerais. In these locations, AgroGalaxy operated with distribution brands Agro100, Grão de Ouro Agronegócios, and Grão de Ouro Comércio de Insumos.

According to the companies, the end of the partnership is due to "different business strategies," as stated in a joint statement signed by AgroGalaxy's CEO, Axel Labourt, and Bayer Brazil's CEO, Marcio Santos. In the statement, the companies also clarify that "the termination of the partnership does not affect the adjustments and reciprocal commitments still pending, nor the commitments already made with their respective clients."

AgroGalaxy's CEO, Axel Labourt, and Bayer Brazil's CEO, Marcio Santos

"AgroGalaxy and Bayer, in respect and transparency with farmers, employees, partners, and the market in general, announce that [...] they have mutually agreed to terminate their commercial partnership for the distribution of pesticides in the Crop Protection segment," they said.

"For the years of partnership with respect and achievements, AgroGalaxy and Bayer thank all those who participated and contributed, directly and indirectly. To AgroGalaxy and Bayer, we wish great success in their journeys," the statement concluded.

Market in Recovery

Excess stocks and reduced sales have plagued the Brazilian market for agricultural inputs, leading to friction and more arduous negotiations between distributors and industry.

AgroGalaxy has been reiterating its need to make severe adjustments to its business structure. Over the past few months, the distributor has implemented several cost containment measures, including store closures and team reductions, in addition to capitalizing from its majority shareholder, the Aqua Capital fund. This year, the company announced the search for a partner to accelerate its seed business, which is considered strategic and provides good revenue margins.

In the nutrition area, AgroGalaxy recently announced to AgroPages the launch of SuperGalaxy, its brand of plant nutrition exclusively created in partnership with Superbac.

(Editing by Leonardo Gottems, reporter for AgroPages)