Global Agrochemicals Market 2017-2021: Top Drivers and Industry Forecasts by Technavio

Technavio market research analysts forecast the global agrochemicals market to grow at a CAGR of more than 3% during the forecast period, according to their latest report.

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Technavio has published a new report on the global agrochemicals market from 2017-2021. (Graphic: Bu ...

Technavio has published a new report on the global agrochemicals market from 2017-2021. (Graphic: Business Wire)

The market study covers the present scenario and growth prospects of the global agrochemicals market for 2017-2021. The report also lists fertilizers and pesticides as the two major product segments, of which the fertilizers segment accounted for more than 56% of the market share in 2016.

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Technavio analysts highlight the following three market drivers that are contributing to the growth of the global agrochemicals market:

  • Increasing use of herbicides
  • Growing demand from developing countries
  • Technological improvements leading to efficient methods of agriculture

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Increasing use of herbicides

Huge investments are being made for the development of new varieties of herbicides that are more effective and eco-friendly. Applications of herbicides are spread across varieties of crops, including cereals, grains, fruits, vegetables, oilseeds, and pulses. The shift in consumer preference toward fruits and green vegetables is propelled by increasing awareness with respect to health and fitness. This is also fueling the increased use of herbicides in agricultural applications.

Dow Chemical has recently launched two new grassland herbicides, Levstar and Envy. The company claims that these herbicides can protect crops from weeds that are resistant to existing herbicide products.

“Players in the global agrochemicals market are spending a considerable proportion of their revenue on R&D activities to bring in new and innovative products in the market such as bio-based herbicides. Although these herbicides are eco-friendly, they are relatively expensive solutions for controlling weeds that have become resistant to chemical-based herbicides,” says Ajay Adikhari, a lead analyst at Technavio for agrochemicals and fertilizers research.

Growing demand from developing countries

There is high growth potential for the agrochemical market in the untapped, emerging markets of India and China. Currently, India's consumption of pesticide stands at 0.6 kilograms per hectare, which is among the lowest compared with 5-7 kilograms per hectare in the UK and nearly 13 kilograms per hectare in China. With increasing awareness among farmers, further penetration will lead to a rise in the consumption pattern. These two economies with the largest population, have a rural belt of more than 67% in China and 44% in India.

“China's agricultural output is approximately 140% more than India and 68% more than the European Union. The rising demand for food and the decrease of land for crop cultivation, especially in developing countries, will propel the use of agrochemicals for the improvement of farm yield and reduction of crop loss,” says Ajay.

Technological improvements leading to efficient methods of agriculture

The rapidly growing world population and proportionately declining arable land have led to the need for improvement in agricultural production. Advancements in new breeding technologies claim to improve yields, as well as increase the lifespan of crops. For instance, genetic modifications improve the crop yield by increasing fertilizer absorption capacity. However, these crops still require agrochemicals such as pesticides because they are not completely pest resistant. Therefore, the requirement of pesticides will increase with the rise in the adoption of GM crops.

The development of efficient methods of farming will result in causing less harm to the environment and human health. Therefore, new technological advancements will further drive the global agrochemicals market during the forecast period.

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