2010 Review of Insecticides, Fungicides and Herbicides Markets

By Zhang Nantong

The surplus production capacity, more stringent requirements for environmental protection, RMB appreciation and frequently extreme climate conditions have caused the 2010 pesticide market in China.

Consumption of traditional insecticides reduced

The consumption of insecticides declined considerably in 2010, mainly due to an unusually light incidence of pests and the extensive application of insecticides with high effectiveness and high persistent. According to an expert, the consumption of insecticides in China reduced around 30% in 2010, especially with higher reduction in rice insecticides.

1. Demand for organophosphorus insecticides decreased
Since China reduced production and use of organophosphorus insecticides with high pollution and high environmental risk such as phorate, isocarbophos, isofenphos methyl and terbufos, the output of organophosphorus varieties fell further in 2010. Due to the increase of plantation acreage for insect-resistant cotton, the incidence of cotton bollworm and cotton red spiders was less serious, so the consumption of profenofos was down. During January-July 2010, the operating rate in trichlorphon and triazophos enterprises was less than 10% because of the slack market demand. Two large dichlorvos companies - Nantong Jiangshan Agrochemical & Chemical Co Ltd (SH: 600389) and Hebei Xinfeng Pesticide & Chemical Stock Co Ltd - relocated and suspended their production, resulting in the tense supply of dichlorvos in 2010. Chlorpyrifos already has an application history of over 30 years in China, and domestic production capacity of chlorpyrifos has reached 70 000 t/a. China's demand for chlorpyrifos is around 18 000 tons and the amount of chlorpyrifos technical exported is over 10 000 tons. The production capacity of chlorpyrifos in China is serious surplus, chlorpyrifos price competition domestically is getting fiercer, and many chlorpyrifos producers suffer losses.

2. Sales amount of low-toxicity substitute products increased

Due to the prohibition of the use of five highly toxic pesticides, including methamidophos, and the ban of fipronil for direct use in agricultural production from July 1st, 2009, the demand for the substitute products for pesticides with high toxicity such as pymetrozine, chlorpyrifos, avermectins, emamectin benzoate and acetamiprid grew considerably. Except for rice, corn, wheat and cotton with higher demand for insecticides, the consumption of insecticides in vegetables and fruit trees increased. In recent years, the sale amount of bio-insecticide emamectin benzoate has grown constantly, but the production cost of bio-insecticides is 30% higher than that of chemical pesticides with the same effectiveness, so bio-insecticides have not yet been accepted by many Chinese farmers. In addition, the market share of compound pesticides increased in 2010. According to statistics, the market share of compound insecticides including avermectin plus chlorpyrifos has grown 20% annually in recent years in Sichuan and Hunan provinces, reaching around 30% at present.

Demand for fungicides increased gradually

1. Brisk demand for new-type fungicides for rice paddies
China's consumption of fungicides has increased constantly in recent years. The middle and late rice diseases - mainly rice blast and rice sheath blight - were more serious in 2010, and such diseases plagued 19.2 million hectares of land. Because bacteria have resistance due to long-time use, the effectiveness of the traditional fungicides has declined steadily. The demand for new fungicides with high effectiveness such as carbendazim /sulfur blend, ethylicin and kresoxim-methyl in the control of rice blast grew steadily in 2010. China mainly uses validamycin for the control of rice sheath blight. Validamycin is the most successful biological fungicide developed by China for the control of sheath blight in rice. The output of 5% validamycin formulation in China is ranging 30 000 - 40 000 tons annually, covering an area over 10 million - 13.3 million hectares. According to an expert from Anhui province, among fungicides, prochloraz and tebuconazole have won high praise in the market. Both are fungicides with low toxicity for controlling sheath blight, false smut and blast in rice. Compared with these in the past years, the rice diseases were more serious in 2010, the market price of the two fungicides rose slightly. The price of prochloraz technical rose to around RMB60 000 per ton from the price of RMB58 000 per ton in 2009, while the price of tebuconazole technical increased from RMB73 000 per ton to RMB78 000 per tons.

2. Fungicides in high effectiveness, low toxicity and broad-spectrum become mainstream products
During January - early May 2010, the serious diseases of farm crops pushed the demand for high effectiveness, low toxicity and low residue fungicides such as metalaxyl, carbendazim, thiophanate, thiophanate-methyl, folpet, zineb, milneb, amobam, bordeauxmixture and potassium permanganate to rise, and the consumption growth was around 10%. Carbendazim is an important fungicide with a broad spectrum, and the demand for carbendazim in China is over 10 000 tons. Both domestic demand and export amount of carbendazim increased in 2010. After the price rise of raw materials, the price of carbendazim technical in 2010 surged from RMB25 000 per ton to RMB34 000 per tons.
   Triazole fungicides are a category of fungicides with highest sales value, and enjoyed good sales in domestic market in 2010. The demand for varieties including triadimefon, tebuconazole and mancozeb for the control of wheat stripe rust increased and their market prices rose around 10%. Due to the considerable price rise of raw materials and more stringent requirements for environmental protection, many triadimefon producers reduced or suspended their production, so domestic supply of triadimefon became very tense. The price of triadimefon technical increased from RMB50 000 per ton to RMB56 000 per tons. In addition, the prices of other triazole fungicides such as paclobutrazol, uniconazole, triadimenol and diniconazole also grew around 10%. As a broad-spectrum antibiotic fungicide, polyoxin has extensive application in the control of diseases and insects of rice, wheat and cotton, and is welcomed in the market. Besides, the market demand for high-end imported varieties increased, but their market prices changed little.

Bright market prospect of new-type herbicides

China's demand for herbicides rose constantly in 2010. In China, the land needing herbicides has increased by 2 million hectares annually in recent years, and has now reached 60 million hectares. Over 80 000 tons of herbicide active ingredients are used in China every year. With the increase of the crop acreage using chemical herbicides, domestic demand for herbicides will further increase.

1. Herbicides Develop towards high-effectiveness, low-toxicity and low-dosage varieties
At present, more than 100 types of herbicides have been used in China. Among them, the top 20 accounted for around 75% of the market share, calculated by area of use. The sales volume of some staple varieties such as alachlor, butachlor, acetochlor, atrazine, chlornidine and thiobencarb fell considerably whereas the sales volume of new-type products rose drastically.
   China has used herbicides in rice fields for over 20 years. Barnyard grass has developed resistance to quinclorac, while sedges and broadleaf weeds have become resistant to bensulfuron-methyl. In addition, China has been promoting a new way for cultivating rice in recent years. This put forward higher requirements on the control of weeds in paddy fields. The 10% flucetosulfuron WP is welcome in the market because it can control barnyard grass and broadleaf weeds in