Showing posts with label pesticide enterprise. Show all posts
Showing posts with label pesticide enterprise. Show all posts

Wednesday, July 11, 2012

Government Purchasing: Excited but Hard to Involve for Most Pesticide Enterprises


Since the Ministry of Agriculture of China (MOA) released the agricultural subsidy policy on 6 April, 2012, USD253.16 million (RMB1.6 billion) of subsidy has been allocated to 11 winter wheat planting provinces and areas in China to subsidize peasants' use of pesticides and foliar-fertilizer on winter wheat, with total planting area reaching 21.33 million ha., based on CCM International’s latest issue of Crop Protection China News.

The main reason for allocating such large amount of subsidy by the MOA in just two months is to ensure the high and stable yield of the winter wheat this year.  

Although the subsidy seems to be a tip of the iceberg of Chinese Government's agricultural budget made at the beginning of 2012, over USD194.41 billion, it is still a big cake for domestic pesticide enterprises.

Driven by the large profit in the subsidy, many domestic pesticide enterprises scrambled for the bid inviting of local governments. Some pesticide enterprises in other provinces and areas even made great effort to go cross-regional bid.
 
"We have paid great attention to the dynamic of government purchasing. We set the goal of achieving an order worth USD12.66 million when we got the information that the Henan Government was planning a government purchasing of USD63.29 million. Aiming to get the order, we set up a special team to prepare all the documents needed in the bid and tried our best to make all the procedures right," said a manager from Guoguang Agro-Chemical Co., Ltd., a large pesticide enterprise located in Sichuan Province.

However, even if enterprises are very excited about government purchasing and put a lot of enthusiasm on it, many of them still can't get involved, even for some large pesticide enterprises.
 
Owing to the cumbersome procedures of the bid inviting, lots of pesticide enterprises lack the experiences of preparing bid materials. As many pesticide enterprises located in different provinces went to other provinces for the bid inviting, they were forced to give up when they found that it was impossible to fetch the materials needed in a short time.
 
In addition to the cumbersome procedures and lots of bid materials needed, the high threshold set by local governments was also a big threat to the pesticide enterprises who want to gain the bid inviting, especially those medium and small sized ones.
 
Take the threshold of the bid inviting of pesticide purchasing by governments in Shandong Province and Henan Province for example. The two provinces invited public bidding by county-level authorities.

Suppliers should be independent legal entity with registered capital no less than USD1.58 million. Owing pesticide production license, pesticide registered license and product standard certification should be one of the main requirements and all these licenses should be valid. Pesticide products should get registered on wheat. Enterprises should issue qualification test report of provided products. Enterprises should own the quality control lab and five years of production experience of related products. And the capacity of the related products should exceed 1,000t/a.
 
Some provinces which invited public bidding by provincial authorities only allowed large and famous pesticide enterprises to participate.
 
Facing the high threshold set by governments, small-sized pesticide enterprises have to find their own ways to attend the bid. Aiming to meet the requirements, many small enterprises choose to co-found pesticide enterprises with manufacturers, large pesticide dealers, etc. Forming coalition bidder with qualified enterprises also can help them to participate.
 
As Chinese government's focus on the governments purchasing of pesticides increases year by year, domestic pesticide enterprises start to realize the importance of anticipating and achieving the bid inviting. It not only provides great profit but also a good marketing measure for a company's products due to the government's credibility. However, different from normal marketing channels, government purchasing seems to be a tough task for most of domestic pesticide enterprises. How to overcome the problems of less experience in dealing with governments, knowing well all the cumbersome procedures during government purchasing is now become the first puzzle for most domestic enterprises to solve.

Source: Crop Protection China News 1212

Content of Crop Protection China News 1212:
Government purchasing: excited but hard to involve for most pesticide enterprises
Glyphosate price rises against market trend
Large area in China attacked by drought
Full implementation of new pesticide policy in Hainan postponed again
MIIT releases new policy for renewal of pesticide production licenses
Zhejiang Wynca to set foot in seed industry
Shandong Dacheng ready for being backdoor listed
Jiangsu Kuaida to largely expand phosgene capacity
Jiangsu Lanfeng puts some new projects into production

Crop Protection China News, a semimonthly publication issued by CCM International on 15th and 30th(31st) of every month, aims to gain a deep insight into Chinese market, supply the latest market data and strategy support, analyze the newest legislation and policy and grasp the future market trend.


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, please visit http://www.cnchemicals.com.
CCM International Ltd.
Guangzhou CCM Information Science & Technology Co., Ltd.
17th Floor, Huihua Commercial & Trade Mansion, No.80 Xianlie Zhong Road, Guangzhou 510070, China
Tel: 86-20-37616606

Tuesday, April 24, 2012

China Holds First Matchmaking Meeting for Direct Pesticide Sales

Hosted by Farmer's Daily, the 2012 Matchmaking Meeting for Pesticide Enterprises and Large Pesticide Consumers was successfully held in Beijing City on 17 March-18 March, 2012. It's considered to be an innovation measure for domestic pesticide industry to try such a new sales mode which directly connects pesticide enterprises and large pesticide consumers, based on CCM International’s latest issue of Crop Protection China News.

Attracting more than 300 agricultural cooperatives and large-scale plantations and over 60 large pesticide enterprises, the meeting turned out to be very satisfactory. There were totally 42 procurement letters of intent signed at the meeting, valuing about USD5.87 million.

Representatives from all parties sang highly of this new sales mode and expressed their appreciation to such a face-to-face communication platform. Pesticide enterprises, including some very famous pesticide giants such as Shenzhen Noposion Agrochemical Co., Ltd. (Noposion), DuPont and Qingdao Hailir Pesticides and Chemicals Co., Ltd., all attached great importance to the opportunity and brought along their own advantaged products.

"I have attended many pesticide industrial exhibitions, but most of the participants were pesticide enterprises and dealers. This is my first time to attend such a meeting with plenty of attendances from enterprises and large-scale plantations. We now have considered the direct matchmaking among our company, agricultural cooperatives and large-scale plantations to be one of the big pictures of sales and long-term strategies," said Mr. Wang, Vice General Manager of Noposion.

Noposion, as one of the beneficiaries of the matchmaking meeting, has won three procurement letters of intent valuing USD678,730. Some other companies such as Shaanxi Sunger Road Bio-Science Co., Ltd. and Bainongsida (Beijing) Agrochemicals Co., Ltd. also signed lots of procurement letters of intent with agricultural cooperatives and large-scale growers.

Not only pesticide enterprises but also those large pesticide consumers have benefited from the matchmaking meeting. Discussing business face to face with pesticide enterprises has offered large-scale growers a good opportunity to get much cheaper pesticides (20%-50% off the market price), more quality products and even customized products.

"I attend the meeting not only for purchasing quality pesticides, but also for seeking a professional and integrated solution for the green and organic development of my 5,333 ha. medlar farm," said Mr. Qin, President of a medlar production company in Qinghai Province.

Actually, it is very wise for Farmer's Daily to hold such a matchmaking meeting in China at present. After several years' development, especially in the past three years, the step of rural land circulation transactions has speeded up. On one hand, with the development of urbanization, lots of small-scale growers abandoned their farmland for finding works in cities. On the other hand, lots of large-scale growers now appear in China after policies are carried out by Chinese Government to encourage land leasing in rural areas. Moreover, according to recent government reports released on the Fifth Session of the 11th National People's Congress (5 March-14 March, 2012), China will continue to encourage the development of large-scale growers and is planning to carry out policies to cite those large-scale growers who have made great contribution to local grain production.

The signal from the government's direction and policies may inspire domestic pesticide industry that the matchmaking between pesticide enterprises and large-scale growers is one of the irreversible trends in domestic pesticide market. The old sales mode that pesticide dealers dominate sales links is no longer suitable for the development of domestic pesticide industry, even though it is still the mainstream. With the great opportunity of sales channel innovation, domestic pesticide enterprises should prepare themselves and make a long-term strategy toward the new sales mode.


Content of Crop Protection China News 1206:
China holds first matchmaking meeting for direct pesticide sales
China’s pesticide import in Q1 2012 rises
Increasing oil price increases agricultural production cost
Glyphosate: TC price climbs but formulation price stays
Policy to support development of leading agricultural enterprises
China releases 2012 Temporary Purchasing and Storage Plan for Cotton
Huapont raises money to expand pesticide business
Heilongjiang's soybean planting area continues to shrink
Areas from south to north in Shanxi attacked by drought

Crop Protection China News, a semimonthly publication issued by CCM International on 15th and 30th(31st) of every month, aims to gain a deep insight into Chinese market, supply the latest market data and strategy support, analyze the newest legislation and policy and grasp the future market trend.


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, please visit http://www.cnchemicals.com.
CCM International Ltd.
Guangzhou CCM Information Science & Technology Co., Ltd.
17th Floor, Huihua Commercial & Trade Mansion, No.80 Xianlie Zhong Road, Guangzhou 510070, China
Tel: 86-20-37616606

Tuesday, November 29, 2011

Pesticide Revenue of Syngenta Exceeds That of China Top 100 Players

CCM International released the latest issue of Crop Protection China News on November 15, 2011. It shows that total pesticide revenue in 2010 of the top 100 pesticide manufacturers in China can't even catch up with that of Syngenta.

As we know, China's pesticide industry has witnessed great development in the past few decades, and lots of excellent pesticide enterprises has emerged in domestic pesticide market. As reported in CCM international’s last issue, China Top 100 Pesticide Manufacturers come out, ranking by company revenue.

However, the tragedy is that the total revenue of China’s top 100 pesticide manufacturers can not even catch up with that of Syngenta, a foreign pesticide giant. Total revenue of China’s top 100 pesticide companies reached USD7,803.62 million in 2010, while the pesticide revenue of Syngenta reached USD8,900 million with a growth rate of 3% over 2009.

"We are just long-term contract workers of foreign pesticide giants even though we think we are good enough," said Professor Zhang Yibing from Shanghai Pesticide Research Institute. Most pesticide players in China agree with Mr. Zhang’s point of view.

"We provide technical products with high quality to foreign pesticide giants but only gain little OEM (original equipment manufacturer) profit," said an insider from a listed pesticide manufacturer.

Actually, most of the pesticide manufacturers whose names appear on the top of the list have kept good relationships with foreign pesticide giants in recent years. For example, Zhejiang Wynca Chemical Industry Group Co., Ltd., Hubei Sanonda Co., Ltd., Jiangsu Changqing Agricultural Chemical Co., Ltd., etc. are the main pesticide suppliers of Bayer in China; Jiangsu Yangnong Chemical Co., Ltd., Nantong Jiangshan Agrochemical & Chemicals Co., Ltd., Jiangsu Huifeng Agrochemical Co., Ltd., etc. are the main pesticide suppliers of BASF in China.

The identity of long-term contract workers being labeled on domestic pesticide manufacturers hinders their development. Aiming to survive in domestic pesticide market and account for more market shares, most domestic pesticide enterprises are more inclined to the production of off-patent pesticides and OEM production for foreign pesticide enterprises. However, without the support from strong policies and more investment in pesticide R&D from Chinese government, it may still be a long way to go.

You might discover more details in Crop Protection China News 1121 with following headline news:
-Anhui Guangxin's IPO application is rejected by China Securities Regulatory Commission (CSRC) on 2 Nov. 2011.
-Anhui Huaxing releases its Q3 financial report of 2011, showing a deficit in this period. Simultaneously, it announces that it will receive a subsidy of about USD11.81 million from the local government.
-Jiangsu Limin's application for environmental protection supervision submitted for IPO has been initially passed by the local government and is now waiting for the public notification.
-Total pesticide revenue in 2010 of the top 100 pesticide manufacturers in China can't even catch up with that of Syngenta in 2010. It is a painful reality and a serious alert to domestic pesticide players and Chinese government.
-China has laid great efforts to manage pesticide wastes problem and its cooperation with -German experts has started taking effect.
-The Ministry of Agriculture is going to fully implement the designated sales of high toxic pesticides in key vegetable planting areas.
-China's trade surplus of pesticide import and export in Jan. to Aug. 2011 reaches USD1,334.97 million, up 59.6% over the same period of 2010.
-A new pesticide-fertilizer called fungicidal and yielding pesticide-fertilizer WG gets appraisal from experts thanks to its good performances in controlling rice diseases and stimulating growth.
-More than 60% soybean processing enterprises in Heilongjiang Province suspend recently due to the difficulty of purchasing soybean and the intense market competition.

(Guangzhou China, November 17, 2011)


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, please visit http://www.cnchemicals.com.
CCM International Ltd.
Guangzhou CCM Information Science & Technology Co., Ltd.
17th Floor, Huihua Commercial & Trade Mansion, No.80 Xianlie Zhong Road, Guangzhou 510070, China
Tel: 86-20-37616606

Monday, November 21, 2011

Identity of Long-term Contract Workers Bothering Domestic Pesticide Players

China's pesticide industry has witnessed great development in the past few decades and lots of excellent pesticide enterprises emerged in domestic pesticide market, such as Zhejiang Wynca Chemical Industry Group Co., Ltd., Jiangsu Yangnong Chemical Co., Ltd., Hubei Sanonda Co., Ltd. and Nanjing Redsun Co., Ltd. These pesticide enterprises have shown great competitiveness and influence, and become the mainstay in the development process of domestic pesticide industry, based on CCM’s latest issue of Crop Protection China News.

However, as more and more problems appear in domestic pesticide industry, such as overcapacity, over competition, lack of innovation capability and chaotic market management, the survival condition of domestic pesticide enterprises has changed from bad to worse.

As CCM International reported in the last issue, the high-profile list, namely 2011 China Top 100 Pesticide Manufacturers, showed the ranking of 100 domestic pesticide manufacturers and their revenues in 2010. It is till now the most authoritative version of pesticide enterprise rankings in China.

Although it should be excited for companies who are on the list, most of them feel very depressed.

It is very disappointed to see the result of comparing the total revenue of most competitive domestic pesticide manufacturers to one foreign pesticide giant, namely Syngenta. According to the list of 2011 China Top 100 Pesticide Manufacturers, the total revenue of the first 100 pesticide manufacturers reached USD7,803.62 million. However, the pesticide revenue of Syngenta in 2010 reached USD8,900 million with a growth rate of 3% over 2009.

"We are just long-term contract workers of foreign pesticide giants even though we think we are good enough," said Professor Zhang Yibing from Shanghai Pesticide Research Institute. And this point of view has been agreed by most pesticide players in China.

"We provide technical products with high quality to foreign pesticide giants but only gain little OEM (original equipment manufacturer) profit," said an insider from a listed pesticide manufacturer.

Actually, most of the pesticide manufacturers whose names appear on the top of the list have kept good relationships with foreign pesticide giants in recent years. For example, Zhejiang Wynca Chemical Industry Group Co., Ltd., Hubei Sanonda Co., Ltd., Jiangsu Changqing Agricultural Chemical Co., Ltd., etc. are the main pesticide suppliers of Bayer in China; Jiangsu Yangnong Chemical Co., Ltd., Nantong Jiangshan Agrochemical & Chemicals Co., Ltd., Jiangsu Huifeng Agrochemical Co., Ltd., etc. are the main pesticide suppliers of BASF in China.

Although China is considered to be one of the largest pesticide production and consumption countries in the world, its pesticide industry is highly depended on export with an export dependence ratio of over 50%. Its pesticide export volume reached over 1 million tonnes in the past three years. In 2010, domestic pesticide output reached 2.34 million tonnes and the export volume reached 1.22 million tonnes.

Eyeing that the price of raw materials, cost of environmental protection and labor, RMB appreciation, etc. rapidly rose in H1 2011, domestic pesticide manufacturers suffered great pains in running pesticide business this year.

The identity of long-term contract workers being labeled on domestic pesticide manufacturers bothers them seriously now and then. Although they have been considering changing the situation through technology innovation, with Chinese government's high-profile encourage but poor continuous investment in pesticide R&D, the development of pesticide innovation is painfully slow. Thus, aiming to survive in domestic pesticide market and account for more market shares, most domestic pesticide enterprises are more inclined to the production of off-patent pesticides and OEM production for foreign pesticide enterprises. Shaking off the identity of long-term contract workers means a lot to domestic pesticide players. However, without the support from strong policies and more investment in pesticide R&D from Chinese government, there may still be a long way to go.

Source: Crop Protection China News 1121

Content of Crop Protection China News 1121:
Anhui Guangxin's IPO rejected
Anhui Huaxing to tide over deficit by aid
Jiangsu Limin tries IPO again
Pesticide waste management in China
MOA: designated sales of highly toxic pestisides in key vegetable planting areas
Trade surplus of pesticide import and export surges in Jan. to Aug. 2011
New pesticide-fertilizer appraised by experts
Most of Heilongjiang soybean processing enterprises suspend

Crop Protection China News, a semimonthly publication issued by CCM International on 15th and 30th(31st) of every month, aims to gain a deep insight into Chinese market, supply the latest market data and strategy support, analyze the newest legislation and policy and grasp the future market trend.

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, please visit http://www.cnchemicals.com.
CCM International Ltd.
Guangzhou CCM Information Science & Technology Co., Ltd.
17th Floor, Huihua Commercial & Trade Mansion, No.80 Xianlie Zhong Road, Guangzhou 510070, China
Tel: 86-20-37616606