By Xu Lijuan, Sublime China Information
By their chemical structure, insecticides are divided into neonicotinoid insecticides, organophosphorus insecticides, pyrethroid insecticides, carbamate insecticides, organochlorine insecticides, and acaricides insecticides. Neonicotinoid insecticides include imidacloprid, thiamethoxam, acetamiprid and clothianidin. They are broad-spectrum and highly effective, have good systemic properties, and mostly can be used for foliar sprays and seed treatment or soil treatment. However, neonicotinoid insecticides have a certain impact on the health of bees, and some areas have formulated prohibition and restriction on them. Pyrethroids include pyrethrin, bifenthrin, cypermethrin, and deltamethrin. Pyrethroid insecticides are highly efficient, low-toxic, and superior in performance, and their market shares have been continuously consolidated. Organophosphorus pesticides include chlorpyrifos, phoxim, profenofos, etc. Their market shares are shrinking, gradually replaced by new high-efficiency and low-toxic pesticides.
Tight at the beginning and end of 2020
In 2020, the insecticide and pesticide market can be summarized as "tight at both ends and loose in the middle". This is because of insufficient market supply and poor spot circulation at the beginning of the year, and the increase of overall cost of pesticides on the back of the surge of some chemical raw materials in the second half of the year, especially the fourth quarter. Insecticides like nicotines and pyrethroids (imidacloprid, cyhalothrin) began to rebound in the fourth quarter of 2020, and the emamectin benzoate and acitretin powder markets began to rebound in January 2021.
In 2020, the cyhalothrin market continued to decrease in fluctuation. The annual price averaged at RMB194 600 /t, a year-on-year decrease of 38.36%. The lowest price of the year dropped to RMB170 000 /t, reaching a 3-year low. Then the price started to go up in late December 2020, and from January to February 2021, the cyhalothrin market continued to be strong, with the current price at RMB195 000 - 200 000 /t. Chart 1 shows the market price trend of cyhalothrin. The main intermediates of the synthetic cyhalothrin are lambda cyhalothrin acid and ether aldehyde. As there are very few ether aldehyde producers in China, and market is highly import dependent. Meanwhile, Chinese lambda cyhalothrin acid capacity is sufficient. The prices of basic chemical raw materials rose significantly in December 2020, and the prices of lambda cyhalothrin acid’s feedstock acetonitrile and isoprene increased too. Due to tight supply, the isoprene market rose from RMB7 700/t at the end of October 2020 to RMB11 000/t (by March 5, 2021).
Chart 1 Cyhalothrin technical grade market price, RMB10 000/t
In 2020, the average market price of imidacloprid was RMB106 900 /t, down 29.06% year-on-year. In the first half of 2020, the imidacloprid market continued the downturn of 2019, and the price fluctuated down from RMB130 000 /t to RMB90 000 /t. In the second half of the year, the overall situation of technical materials improved as there were more orders and sales due to the decrease of prices. In September 2020, imidacloprid companies formulated a price-insurance policy, and the domestic transaction volumes gradually increased. With the boom of both domestic and foreign demand, the imidacloprid market stabilized and rebounded. Chart 2 shows the market price trend of imidacloprid.
Chart 2 The imidacloprid market price
The imidacloprid market continues its upward trend in 2021. By March 4, 2021, the market prices were in the band of RMB120 000/t and RMB125 000/t, up 25.00% over the beginning of the year and down by 3.85% from the same period in 2020. Manufacturers have adequate pre-orders.
Chart 3 shows the market price of emamectin benzoate, which declined in fluctuation in 2020, averaging at RMB966 300 /t, down 16.59% year-on-year. The price rebounded slightly in March, and the highest was RMB1.055 - 1.06 million/t. At the end of 2020, market demand increased, so did the production orders.
Chart 3 The emamectin benzoate market price
The market started well in 2021, and the price rose at a rapid pace, from RMB850 000/t to RMB1.05 million/t. The main reason is the increase in orders, tightness in supply, and the rising price of the upstream raw material avermectins fine powder.
The capacity of mainstream pesticide companies to stabilize
With the continuous integration of the pesticide industry and the increasing requirements in various aspects, a broad space has been provided for high-efficiency, low-toxic, and easily decomposable pesticides. The overall supply and demand pattern of the pesticides will be continuously adjusted following market changes. Mainstream manufacturers will have more advantageous and stabilized production capacities.
Cyhalothrin: At present, the transactions are sluggish. Some lambda cyhalothrin acid producers have plans to resume production after a period of maintenance, releasing the shortness of the supply, which might weaken the expectation of increase in cyhalothrin. It is expected that the cyhalothrin market will remain stable and the short-term upward momentum will be insufficient.
Imidacloprid: The production of the technical grades is stable, and short-term pre-received orders support the sales. The new trades are slow. It is expected that the short-term imidacloprid market will remain steady.
Emamectin benzoate: As the market rises, the downstream buying enthusiasm decreases, the volume of new orders declines, and there are signs of adjustment in the market in a short period of time. However, manufacturers of emamectin benzoate have no inventory pressure for the time being, and the market is in the demand season. It is expected that the emamectin benzoate market may consolidate again after a fine-tuning.
