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Ciech

Szukaj

Plant Protection Chemicals (PPC)

The CIECH Group is one of the largest domestic producer of plant protection products and leaders in the domestic market of herbicides.

It is estimated that in 2016, the value of sales in the global market of plant protection chemicals reached USD 50 billion and was approximately 2.4% lower than in the previous year. This decline was caused primarily by: large inventories held by distributors (in particular in Latin America), appreciation of USD, low prices of cereals and key herbicide – glifosat, as well as negative impact of the El Niño current (mainly in Brazil). The largest drop in sales was recorded in Latin America (nearly 7%). North America was the only region to record growth (by a approx. 1%).

More than 40% of sales of global plant protection chemicals is attributable to herbicides. Insecticides correspond to nearly 1/3, while fungicides — approximately 1/4 of the value of the global market.

In 2016, the world market was still dominated by 6 main global producers, i.e. Syngenta, Bayer CropScience, BASF, Dow AgroScience, Monsanto and DuPont. These companies are main contributors to the world markets because they significantly influence directions of the industry development, including: development of new technologies and introduction of innovative products to the market. Share of the above-mentioned producers in total world sales of agrochemicals (not only for direct protection of plants) is estimated at about 70%. As a result of mergers (of Dow Chemical with DuPont and of Bayer with Monsanto), in 2017, the number of leading players will be reduced to 4.

Asia and Latin America are currently the largest regional markets of plant protection chemicals with shares in global sales amounting to 28% and 26% respectively. Slightly smaller markets are Europe and North America (about 20% each). The value of the European market in 2016 can be estimated at approx. USD 11.5 billion. Consumption of plant protection chemicals in the other regions amounts to the remaining few percent of global consumption.

Since the beginning of the 20th century until the half of this decade, demand for PPC in Europe has been growing rapidly (by several per cent annually, according to the value). In the previous two years, demand denominated in USD was declining, which was associated largely with the strengthening of the currency. In general, prospects for further development of the European market of plant protection chemicals can be assessed as positive, especially in the area of generic products manufactured by the CIECH Group.

For a number of years, the biggest European markets for PPC are Spain, Italy, Germany, Poland, UK and Russia.

Since the beginning of this decade, the consumption of plant protection chemicals in Poland fluctuated between 70-95 thousand tons per year. Despite the overall upwards trend in local PPC production, the Polish market is dominated by foreign suppliers with a very wide range of products. 

Significantly more herbicides and fungicides are used in Poland compared to world consumption because of high percentage of grains in general cultivated area and considerable importance of gardening. In turn, insecticides are used in much smaller quantities.

 

Despite a temporary decline in the market size in 2015-2016, long-term prospects for growth on the PPC market remain attractive.

The Polish market of plant protection chemicals should continue to grow over the following several years. Unit consumption of products per 1 ha is still much lower in Poland than in Western European countries. Moreover, it can be assumed that economic situation of Polish farmers should be sustained due to direct subsidies received from the European Union. Additionally, controversies concerning genetically modified plants (GMO) should effectively influence the higher demand level for traditional plant protection chemicals.

High level of import is specific to Polish market and amounts to approximately 70% of consumption in terms of weight. The reason of such a high disproportion is lack of sufficient offer of Polish producers, who have much less of financial resources to conduct research on new products, their registration and marketing.

 

Global concerns and several local producers are main participants in the Polish market. CIECH Sarzyna S.A. is one of the largest domestic producers. The company’s activity regarding plant protection chemicals is focused on the Polish market, where the CIECH Group has a share of 6% (by value). This share is much higher with regards to grain herbicides segment, which is the company’s main product group, and amounts to about 20%.

It is expected that over the next 5 years the rate of further growth of global demand for plant protection chemicals should amount to 2.5%-3% on average per year (by value). The main growth factors will be Latin American and Asian markets.

Market forecasts are based on the assumption of decreasing arable land area on the global scale, increasing population and the resulting necessity of constant yield increase. On the other hand, various national and international regulatory bodies, whose task is to monitor pesticide use in order to lower their negative influence on the natural environment will stimulate the uncontrolled pesticide consumption.

 

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