Thursday, September 22, 2011

Cost-performance Ratio Becomes Key Factor for Chinese Farmers' Purchasing Decision

Chinese farmers are more rational in choosing products, and cost-performance ratios has become the first important factor for making purchasing decision, according to CCM’s September issue of Glyphsoate China Monthly Report.

Recently, CCM International visited Shenzhen Noposion Agrochemicals Co., Ltd. (Noposion), China's first listed pesticide formulation producer, knowing that Noposion's glyphosate business has faced stalled growth and Noposion is puzzled by its marketing strategy. "We know glyphosate is the herbicide enjoying the largest consumption volume in China, but the market share of our glyphosate in China's market is very small and the sales volume witnessed stalled growth in recent two years. We wonder whether farmers' pesticide use habit and other factors impact on farmers' purchasing decision," non-selective herbicide product manager said.

After a comprehensive analysis and investigations from market insiders, CCM International has found that prices of Noposion's glyphosate products are very high, but the actual efficiency is not significantly superior to other brands with medium price.

Noposion has registered glyphosate 41% IPA and 68% glyphosate ammonia salt, and glyphosate 41% IPA is the main glyphosate product as China consumes the overwhelming proportion of liquid glyphosate formulations. One of the key selling points of Noposion's glyphosate 41% IPA is that "the formulation could turn blue when diluted by water." The similar "magic" of pesticide products have been attracted many farmers in the past, but, of course, prices of these "magic products" are much higher than others'.

Many professionals and market insiders have pointed out that Noposion's "formulation color change" has no contribution to the glyphosate's actual weed control efficiency. "The formulation has been added acidity indicator and some other chemicals. The acidity will be changed when the formulation is diluted and the acidity indicator changes the color of diluted formulation." Professionals have disclosed the general principle of magic color change.

At present, more and more Chinese farmers become more rational, and these "magic products" with higher price will not attract them any longer. When using it the first time, farmers find that Noposion's glyphosate product has no significant superiority over others, but it costs them more money. Therefore, the selling point of magic color change can't establish good reputation among farmers, but the high pricing of Noposion's glyphosate 41% IPA will become an factor impacting its market extension.

In fact, Chinese farmers pesticide purchasing decision doesn't highly depend on retailer's recommendation and product's famous brand any longer. They are more intellectual and choose product with best cost-performance ratios. With the increasing efficiency of domestic glyphosate product, more and more Chinese farmers choose domestic glyphosate product with lower price and comparable performance rather than famous brand Roundup. The decreased market share of Roundup and Noposion's stalled growth of high price glyphosate 41% IPA are good proofs.
 (Guangzhou China, September 21, 2011)

Content of Glyphsoate China Monthly Report 1109:
Yangnong Chemical:Ugly performance in glyphosate business in H1 2011
Zhejiang Wynca suffers operating profit loss in H1 2011
Asia to be largest growth point of global glyphosate consumption
Cost-performance ratio becomes the key factor for Chinese farmers' purchasing decision
Porter's five forces analysis for China's glyphosate technical industry
Yellow Phosphorus price skyrockets in September 2011
Increasing glyphosate formulation export drives MIPA demand in China
Application of CWAO technology in glyphosate waste water treatment
Glyphosate price slightly increases in Sept.2011
Glyphosate export keeps uptrend in July 2011

Glyphosate China Monthly Report, a monthly publication issued by CCM International on 20th of every month, will keep track of latest dynamics, hotspots and competitiveness analysis, and forecasts on market trends of China’s glyphosate industry.

About CCM

CCM is dedicated to market research in China, Asia-Pacific Rim and global market. With a staff of more than 150 dedicated highly-educated professionals. CCM offers Market Data, Analysis, Reports, Newsletters, Buyer-Trader Information, Import/Export Analysis all through its new proprietary product ValoTracer.
For more information about
Glyphosate China Monthly Report, please feel free to contact us at

CCM International Ltd.
Guangzhou CCM Information Science & Technology Co., Ltd.
17th Floor, Huihua Commercial & Trade Mansion, No.80 Xianlie Zhong Road, Guangzhou 510070, China

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