Recently, government
pesticide procurement has become a hot topic on many agricultural conferences.
It is estimated that the procurement value has reached USD321.2 million
(RMB2.00billion) in the application of wheat, rice, vegetable, tobbaco, cotton
and other crops. It has also become a good marketing method for dominant
pesticide producers, according to CCM’s December
issue of Insecticides China
News.
Lin
Yanru, a researcher from Shandong Plant Protection Station, revealed that
government procurement is the general development trend of China
Since 2011,
government pesticide procurement was in full swing. "Its coverage area and
crop range have been gradually expanded. In 2001, Chinese government began to
procure pesticides; the Ministry of Finance allocated about USD16.06 million
(RMB100 million) every year for purchasing pesticides to control rice plant
hoppers, rice stem borer, wheat rust, locusts and other pests and
diseases", said researcher Lin Yanru.
According
to Li Yanru, in recent three years, the investment for government pesticide
procurement has quickly increased. Many provinces growing wheat, rice have
spent over USD16.06 million (RMB100 million) on pesticide procurement since
2009. Hebei Province Jiangxi
In 2012,
the investment for government pesticide procurement has reached a new peak.
According to the Ministry of Agriculture of China (MOA), the investment merely
on wheat has reached about USD253.2 million (RMB1.6 billion) which has been
allocated to 11 winter wheat-planting provinces and areas for the control and
prevention of pests and diseases of 21.33 million ha. wheat in China
Generally
speaking, government procurement has the following advantages.
First,
pesticides with low toxicity, high effectiveness and environmental friendliness
will be given prior consideration. Therefore, product mix will gradually become
more reasonable.
Secondly,
large purchasing amount attracts many suppliers, and favourable procurement
cost will adjust pesticide price and make it more reasonable.
Thirdly,
centralized bid improves the efficiency of marketing and creates mutual benefit
for participants.
With
Chinese government's increasing attention on government pesticide procurement
year by year, domestic pesticide enterprises start to realize the importance of
anticipating and obtaining bid invitations. Once winning the bid, pesticide
enterprises can largely reduce costs and raise profits.
Jiangsu
Anpon Electrochemical Co., Ltd. (Jiangsu Anpon) is one of the bidding pesticide
enterprise, which has successfully bid in Hebei ,
Jiangxi , Shandong
and Anhui Anhui
Province Hebei Province
purchased a batch of pymetrozine formulations from Jiangsu Anpon to control
wheat aphid; Jiangxi
Province
In fact,
for the bid of government procurement, many pesticide enterprises still can't
get involved, even for some large pesticide enterprises. Manager Shenyangfeng
from Shaanxi Sunger Road Bio-Science Co., Ltd. expressed that many enterprises
had difficulties managing government procurement. Taking county-level
procurement bid for example, the bid application usually needs to be sealed
from village government to country government and it involves sealing cost
every procedure. Only enterprises that have comprehensive social networks and
bravery to compete for the price can act like a duck to water.
The
procedures of bid invitation are cumbersome and lots of pesticide enterprises
lack the experiences of preparing for bid materials. Many pesticide enterprises
had to give up the bid when they found that it was impossible to fetch the
necessary materials in a short time as they treked a long way to other
provinces for the bid invitation.
In addition
to the cumbersome procedures, high threshold set by local governments was also
a big obstacle to pesticide enterprises who want to obtain the bid invitation,
especially those medium and small sized ones.
Lastly,
some overseas pesticide enterprises also see government procurement as a big
opportunity and want to participate. Though government favors domestic
pesticides, it is believed that some foreign pesticide enterprises will benefit
from government procurement thanks to excellent effect of imported pesticides
and their increasing cooperation with the government. For example, spinetoram
and spinosad from Dow AgroSciences have been selected in Jiangsu
Source: Insecticides China
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Insecticides
China News, a
monthly publication issued by CCM on 10th
of every month, provides the latest and influential analysis on insecticide
industry for you, including company dynamics, supply and demand, price
analysis, policy, raw material and intermediate.
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