Analysis of Major M & A, Cooperation Cases and Development Trends for Global Agriculture Biological Industry in 2023

Date:03-15-2024

With the rise of sustainable agriculture and stricter environmental compliance regulations, biologics in farming are becoming a popular industry sector where the production layout is being established by multinational agricultural giants, leading enterprises in the biological industry, innovative start-ups, and even distributors. Looking back over the past decade, global agricultural giants have made ongoing efforts to increase their production of biologics via strategic investments, mergers and acquisitions and multi-dimensional cooperation. In recent years, major mergers and acquisitions and large scale cooperation deals drove the development of the biologics industry to a new high. According to available data, global sales of biologics in 2023 reached US$14.6 billion, and this is expected to grow further at a compound annual growth rate of some 13.8% in the coming years to arrive at sales of $27.9 billion by 2028, proving that biologics have become an important pillar of promoting the sustainable development of agriculture. 

The sector’s development potential encourages large, medium, and small-sized agricultural companies to take part in mergers and acquisitions and cooperate with strategic partners to promote the development of the envisioned ″biological ecosystem.″ Through mergers and acquisitions and cooperation agreements, the advantages of both parties are consolidated, R&D capabilities are enhanced, product portfolios are expanded, new markets are explored, and global influence increased. Meanwhile, mergers and acquisitions have accelerated industry reshuffling and integration, promoting the innovative development of the biologics industry.

This article will focus on cases of major mergers and acquisitions and cooperation agreements in the agricultural input industry in 2023, to highlight the latest concepts related to future enterprise structure adjustments, industrial layouts and entry into the biologics industry sector.

M&A is an important driver that accelerates corporate and industry development

Currently, the agricultural biological industry seems to be in the stage of rapid innovation and commercialization, where mergers and acquisitions are an important approach for enterprises to quickly acquire key technologies, rapidly increase their scale, enhance their strength and capture the global market. Mergers and acquisitions can facilitate the rapid integration and upgrading of industry-oriented technologies and industry operations, provide more abundant and efficient integrated solutions, and promote the sustainable development of agriculture. 

In 2023, the biologics industry market scale was expanded, and its competitiveness was enhanced through mergers and acquisitions. From several cases of relevant mergers and acquisitions, the following features can be summarized as follows:

Acquisitions of famous regional biological companies to expand global operations

In 2023, Corteva acquired the Spanish microbiological technologies company Symborg and the American biological company Stoller, further strengthening its leading position in the global biologic market. Biobest Group, a global leader in biological control and pollination, made frequent overseas acquisitions, starting with acquisition of US company BioWorks, which enabled it to the use Bioworks’ innovative portfolio of biopesticides for disease and insect control, as well as its product development, marketing, and logistics expertise. The acquisition also accelerated Biobest’s business expansion into biopesticides, and soon after, it acquired Austria’s Agrotech Gartenbautechnik to strengthen its business presence in the Austrian market. At the end of 2023, Biobest completed its acquisition of the renowned Brazilian manufacturer, Biotrop, which strengthened its strategic position in the Brazilian market, having established a good foundation for the company’s goal of becoming one of the world’s top 10 agrotech companies by 2034. In 2022, Biobest acquired the regional distributors, Agronologica and Biopartner, in Portugal and Poland, respectively, to strengthen its local business operations. This series of acquisitions facilitated the company’s channel development and market influence in the United States, Latin America and Europe, contributing to rapid market entry and reinforcing the regional market. The Japanese CBC Group directly acquired BIOPLANET, a historic and renowned Italian company that produces beneficial insects and mites, giving the group quick access into the European market via BIOPLANET’s subsidiaries in France, Greece and Spain. 

Rapid access to key technologies via acquisition to enrich product line

In 2023, Sumitomo Chemical India, by acquiring a majority stake in Barrix Agro Sciences, a leading agrotechnical start-up, quickly obtained several cutting-edge agrobiological technologies and products. The acquisition enabled the creation of synergy and the provision to customers of a broader product portfolio. DE SANGOSSE acquired the assets of AlgaEnergy, a Spanish microalgae energy company, having obtained a full set of microalgae technologies and established a microalgae technology-oriented subsidiary, AE AGRIBIOLOGICALS (AEA). Alltech Crop Science acquired Span’s Ideagro, gaining the latter’s soil microbial and enzyme activity analytical technique. The rapid creation of complementary technologies and product portfolio expansions were, therefore, achieved via acquisitions. 

Acquisitions targeting leading agricultural producing countries to capture major agricultural markets

In recent years, the target of M&A begun to shift to major agricultural markets, such as Europe, the United States and Latin America. For example, Stoller, which was acquired by Corteva, is one of the largest independent companies in the biologicals industry and is based in Houston, Texas, with more than 50 years of operating experience in over 60 countries. Mitsui & Co acquired part of C&B AGRI ENTERPRISES LIMITED, a leading Irish biostimulant company, therefore, directly gaining access to the European and American markets. Furthermore, Rovensa acquired MIP Agro, a biocontrol and biostimulant leader in Chile, having reinforced its leading position in the Latin American market. Rovensa also acquired Agro-K, a leading US biostimulant developer, therefore, helping Rovensa Next to gain a foothold in the strategically important US market. These measures are key to capturing the global strategic market.

Leveraging business synergies of merged companies to provide integrated solutions

A typical case would be the acquisition of FBSciences by Valent BioSciences, which is a subsidiary of Sumitomo Chemical. FBSciences leads in the discovery and commercialization of natural plant, soil, and climate solutions. Through the acquisition, Valent BioScience could leverage FBSciences’ expertise in the biostimulant field to provide customers with a range of innovative and proven biocontrol solutions, including biostimulants, biopesticides and crop nutrition solutions. Biological products are an important part of ADAMA’s sustainable product portfolio. In 2023, ADAMA acquired a 40% stake in ADAMA Chile, after previously acquiring a 60% stake in 2013, to provide South American customers with a range of solutions that include conventional agrochemicals, crop  bionutrients, and biostimulants. 

Working together to reshape an innovative biological ecosystem

From industry chain perspective, biological research and development enterprises, plant protection product manufacturers, as well as distributors, are all working together to strengthen their cooperation. The consolidation of the industry chain has facilitated the transformative application of biological technologies, and enabled the coordinated development of the entire industry chain and created a synergistic effect. This development trend is a key driver of the rapid growth of the global biologics industry.

Looking back at some of the collaborations in 2023, it was evident that the cooperation among major global agricultural biologic industry players reached an unprecedented high level, which undoubtedly drove the biocontrol industry to run at an ″accelerated speed.″ 

From a number of collaborations, the following features can be summarized as follows: 

Multinational agricultural giants seeking all-round collaborations to maximize resources

Agricultural giants, represented by Syngenta, Bayer, BASF and Corteva, have been expanding their respective biological product portfolios and product distributions through cooperation, resulting in rapid product sales through their extensive and mature distribution channels. To this end, the biologics market has been shown to have a ″working together″ development pattern among agricultural giants and biocontrol companies.

In 2023, Syngenta entered a strategic partnership with the Belgian company, Biotalys, and the Australian agricultural biotech company, Metagen, to jointly develop innovative novel biosolutions. In terms of distribution partnerships, Syngenta collaborated with Unium Bioscience, having gained the exclusive right of use of the NUELLO^® iN products, as well as becoming the exclusive sales agent for the bio seed treatment agent, TIROS^® in Northwest Europe. Syngenta also launched the novel wheat biostimulant, ACTIV, in Europe, in cooperation with the Belgian Aphea.Bio. Bayer agreed a strategic cooperation agreement with Kimitec in the accelerated development and commercialization of crop biocontrol solutions and biostimulants. Furthermore, Bayer began a strategic cooperation in distribution with France’s M2i Group and Canada’s MustGrow Biologics, therefore, becoming a distributor of related products. BASF distributes Vivagro’s bio fungicide and insecticide, Essen’ciel^® (orange oil), in Italy and Spain. Corteva reached an exclusive distribution agreement with Bioceres to distribute innovative bioinsecticides, together with an exclusive development and commercialization agreement. UPL expanded its strategic cooperation with AgBiTech in the distribution of all its bio-solutions in the United States. In addition, it cooperated with Biome Makers, a leader in agricultural technology, in the use of the latter’s BeCrop detection technology to enhance the positive impact of its natural biological solutions on soil health. AMVAC is ready to cooperate with ExcelAg to launch newly developed and existing biologic solutions to Central America and the Dominican Republic, and it aims to deepen its collaboration with NewLeaf Symbiotics in developing the global biologics market.

Biological companies fully utilizing resource advantages to strengthen product development and distribution collaborations

In terms of product research and development, Japanese companies are still very active. Certis Belchim entered a strategic cooperation deal with the Italian biological company, Clever BioScience, in the development of plant-derived natural peptide products, as well as with Renaissance BioScience, a leading Canadian bioengineering strain company, in the development of RNAi biopesticides. Nihon Nohyaku reached a joint development agreement with the American company, Boost Biomes, in the joint development of novel biopesticides. Sumitomo Chemical expanded its cooperation with Ginkgo Bioworks to develop functional chemicals using synthetic biology, as well as expand the existing cooperation in biomanufacturing between the two companies.

AgBiome, a global leader in microbial innovation, started cooperating with Ginkgo Bioworks in optimizing the product performance of its agricultural biological pipeline using its strain optimization service. It then cooperated with Lamberti in the development of novel biological crop protection products. The French startup, OneOne Biosciences, entered into strategic partnership with Ginkgo Bioworks to leverage the latter’s robust agrobiologics infrastructure, biotech expertise and strain optimization services to accelerate its research and development of agricultural microbial solutions. KitoZyme and Janssen PMP signed an exclusive cooperation agreement to apply the fungal chitosan technology to post-harvest storage and preservation.

In terms of distribution cooperation, for the North American market, AMGUARD, the specialty markets division of AMVAC, began a cooperation agreement with NewLeaf  Symbiotics in an exclusive agency sale of the latter’s biostimulants and biological solutions in the North American market. BioConsortia authorized Nichino America to sell its BEC-60 bio fungicide in the United States and Canada. For Europe and the rest of the world, the 100-year old sulfur product company, AFEPASA, and Ao Midori Biocontrol signed a biocontrol distribution agreement. The Belgian agricultural biomolecule developer, Fyteko, authorized Janssen PMP to sell its biostimulant, NURSPRAY, in several countries. France’s Eléphant Vert authorized Janssen PMP to sell two of its high-quality, proprietary biostimulant products in key countries on several continents. Sumi Agro Europe was authorized to exclusively sell Azotic Technologies’ biological nitrogen fixation product, Encera/Envita, in several European countries. Agrovar, a Bulgarian agrotech company, utilized Biome Makers’ BeCrop^® technology and services to facilitate farmers’ transition from production to regenerative agriculture. In the Indian market, PHC entered a market distribution agreement with Novozymes to distribute the biostimulant, Harpin αβ, which is used to increase sugarcane yields. DE SANGOSSE established a strategic alliance with Kan Biosys to develop a microbial and biosolution ecosystem in India. Kobert signed a strategic alliance agreement with India’s PI Industries to promote sustainable farming in the country and co-innovation in agrobiologic development.

Distributors gradually stepping into sales network to accelerate promotion and application of biologics

Distributors have gradual stepped into the sales network, which is expected to accelerate the promotion and application of biologics. Rizobacter, a global leader in agricultural microbiology, formed an alliance with Colombia’s Gral’s Agrointegral and Agrac, to expand its sales and market influence in Colombia covering biofertilizers, biological fungicides, biological regulators, biostimulants, adjuvants and particle fertilizers. Lavie Bio, a subsidiary of Israel’s Evogene, entered into an exclusive distribution agreement with WinField United Canada to supply the biological inoculant, Yalos, in Canada. Azelis aims to begin distributing Novozymes’ top-ranking biological agriculture solutions in Malaysia, including its microbial inoculants, biostimulants and biocontrol solutions.

Mergers and acquisitions drive global biologics market into a new round of rapid growth

In conclusion, the global biologics market is moving into a new round of rapid growth, driven by the implementation of sustainable development initiatives and the application of digital technologies, leading to the interconnected development between conventional plant protection and innovative biological plant crop protection. Looking into the future, biologics will play a greater role in promoting the transformative green development of global agriculture, which can be summarized as follows: 1) It is important to promote science and technology-based innovations and utilize cutting-edge technologies to develop efficient and green biologics; 2) It is important to build a co-existing industry chain to create complementary advantages in R&D and promote applications; 3) It is important to encourage digital application and improve the precise application of biologics.

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