Avermectin Has Bright Market Prospect

The 21st century is a century of bio-pesticides. Avermectin (AVM) is a bio-pesticide and therefore conforms to the pesticide development trend in the world and the industrial policy in China. China has become a major avermectin production base in the world. There is already a large-scale production of the pesticide technical. Blending and compounding have also been made with more than 30 other effective ingredients. Avermectin has therefore become a major pesticide variety in China.   Avermectin, as a new antibiotic bio-pesticide, has high effectiveness and great safety that can be used in both crops and livestock. It is also one of the best received new products in the bio-pesticide market. First of all, avermectin has a unique action mechanism. It develops little resistance in pests and can effectively kill pests that have already developed resistance to other pesticides. Avermectin features great bioactivity and has contact poisoning to pests. Besides, avermectin also has great selectivity and great safety. The normal dosage is safe for man and livestock and causes no harm to natural enemies and ecological environment. It is therefore recommended by the Ministry of Agriculture as a hazard-free pesticide.   According to the experts, the birth of avermectin is another revolution in antibiotics after the invention of penicillin. It can be used as a mother substance to develop a series of derivatives with greater activity, greater selectivity and greater safety. Nearly 1 thousand avermectin derivatives have already been synthesized today. Ivermectin, emamectin, dormectin, eprinomectin and selamectin have started commercial production.   Avermectin series pesticides are bio-pesticides with high effectiveness, great safety and environmental friendliness, and their market keeps expanding. Many investors have therefore been attracted to make inputs in this sector. After the drastic price rise in 2004, in particular, many companies shifted to produce avermectin to reap fat profits, as a result, the price had another drop in 2005.   The total capacity of avermectin in China was more than 800 t/a in 2005 and according to the incomplete statistics, the sales revenue (including export) reached over RMB1.0 billion. The number of patents concerning avermectin in China has increased to 136 since 1995. Hebei Veyong Bio-chemical Co., Ltd. is one of the largest avermectin producers in China and its capacity has reached 300 t/a. Other producers include Zhejiang Shenghua Biok Biological Co., Ltd. Zhejiang Qianjiang Biochemical Co., Ltd. and Zhejiang Hisun Pharmaceutical Co., Ltd.   Avermectin has a bright development prospect. In the domestic market, the Eleventh Five-year Program (2006-2010) indicates the coming of a new industrial era. The emphasis on environmental protection and the construction of a harmonious society will bring an unprecedented chance to the development of avermectin and its derivatives.   The chance for the development of avermectin in China mainly lies in the substitution for high-toxicity pesticides that will be absolutely prohibited in 2007. The consumption of high-toxicity pesticides in China accounts for around 30% of the total pesticide consumption. The consumption of 5 high-toxicity organophosphorus pesticides including methamidophos, parathion, methyl parathion, monocrotophos and dimecron accounts for around 80% of the consumption of high-toxicity pesticides. To protect the safety of life and health, protect the environment, enhance the competitive edge of agricultural products in the international market and promote the distribution readjustment and industrial upgrading of the pesticide sector, the National Development and Reform Commission and the Ministry of Agriculture have decided to reduce the application of high-toxicity pesticides in three phases from 2004 to 2007. The application scope of the 5 high-toxicity pesticides will be limited to corn, wheat, rice and cotton from 2004 to 2005 and their application in all crops will be absolutely prohibited from January 1st, 2007.   In the next 5 years, China will increase the input in the forest sector for disease and pest control. Besides specific items, compensation offered to the forest sector will also be increased by RMB1.0 billion. The increase of the input will constitute a huge potential market for relevant pesticide producers and also for the avermectin production.   Avermectin producers have achieved outstanding advances in production and processing technologies in recent years. Their innovation awareness and ability have been enhanced and conditions have been created for product quality assurance. Key pesticide producers have shifted their operational mode from traditional sales to marketing, cultivated a contingent of before-sale and after-sale services and therefore acquired the ability and strength to provide high-quality low-priced products and sound services for farmers. The Chinese Government will also exercise strict control on the agricultural means market in order to create sounder conditions for the standardized functioning of the pesticide and animal drug market. The external environment for the legal operation of key agricultural means producers will therefore have a constant improvement.   The demand of bio-pesticides such as avermectin will increase constantly in the domestic market. The sales value proportion of bio-pesticides and GM (genetically modified) technologies in the pesticide market has already accounted for 10% in the world, but less than 5% in China. It has provided an extensive space for the application and market expansion of avermectin in China. Various restrictions put by the United States, Western Europe and Japan on the export of agricultural products from China have also stimulated the consumption growth of avermectin in the domestic market.   The export amount of avermectin in China has been maintained at 30% - 40% of the total output since 1995. In other words, key avermectin producers started their sales in the international market long ago and have already acquired personnel, experience and ability for the participation in the international market. Take Hebei Veyong Bio-chemical Co., Ltd. for instance. The sales revenue from the international market was higher than that from the domestic market in both 2004 and 2005 and the sales revenue of bio-tech products accounted for two thirds of the total. The company has already gained stable market share and trustful clients in the international market.