Friday, January 6, 2012

Domestic Pesticide Market Remains Depressed

Statistics from National Bureau shows that China's pesticide output reached 1.92 million tonnes in Q1-Q3 2011, up 15.7% compared with that at the same period last year. Pesticide output in the whole year of 2011 is predicted to reach about 2.5 million tonnes. Although the amount of pesticide output and sales volume in 2011 is predicted to increase to a certain extent, domestic pesticide industry still seems to be trapped in downturn.

According to the 2011 Q3 financial reports of all the listed pesticide companies in China, net profit of Q1-Q3 in 2011 only reached USD100.66 million, down 32.28% compared with that at the same period last year.

Overcapacity is still considered to be the main reason for the depressed domestic pesticide market. At the beginning of 2011, although insiders have ever predicted that domestic pesticide industry may recover in 2011 due to the prediction of price increase of raw materials, the intense competition and lagging price increase of pesticides have made the industry remain in downturn.

Cracking down and standardizing the chaotic pesticide industry, creating orderly production, investing more in new pesticide R&D, etc. are considered to be good ways to ease the downturn in domestic pesticide industry. Unfortunately, things can’t be changed easily. The severe overcapacity problem in China might still hinder the development of domestic pesticide industry in the next few years.

All findings are from CCM International’s Crop Protection China News. If you are interested in this newsletter, please feel free to contact us.

Specific Headline News of Crop Protection China News 1123:
-According to the performance of domestic listed pesticide enterprises in Q1-Q3 2011, the recovery of domestic pesticide industry has not been realized yet. Overcapacity is still the main reason to drag domestic pesticide industry in downturn.
-Some large agrochemical companies in China have encountered troubles in their business due to the implementation of chain store operation mode, which may be the common difficulties for most of them in China.
-An international press conference, held by Bayer AG in Shanghai on 16 Nov., 2011, declared its expansion plans in Asia in the next four years.
-As more pesticide enterprises in China started to register for nitenpyram formulation and technical production, nitenpyram market is predicted to have an upward trend in the coming years.
-High price of toosedarin insecticides impedes its large promotion in China.
-Registration of the first coumoxystrobin mixed formulation, namely coumoxystrobin·tebuconazole 40% SC, will be approved by the Ministry of Agriculture in 2012.
-CMST released the 12th Five-Year Plan of Biotechnology Development (2011-2015) on 28 Nov., 2011 aiming to better support the development of biotechnology.
-46.7 million ha. arable land in  suitable region in China would be subsoiled again till 2015, trying to enter farming cycle "subsoil the same land once every three years".
-There are some emerging corn pests and diseases beginning to spread in 2011, while proxenus lepigone among them broken out is not an original corn pest.


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