Industry Presentation
The development of the Agrochemical
Market in Europe
Phillips McDougall
Vineyard Business Centre
Saughland
Pathhead
Midlothian
EH37 5XP
Tel : 01875 320611
john@phillipsmcdougall.com
March 2015
1
© PhillipsMcDougall
Industry Presentation
2014
March 2015
2
© PhillipsMcDougall
Industry Presentation
Market Performance 2014
(Ex-manufacturer level – average exchange rates - Nominal US$)
Year
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014 Preliminary
2014 / 2013 %
Crop
Protection
($m)
32204
32814
32508
35885
43187
40147
41291
46539
49549
54208
56145
Non-Crop
Agrocemicals
($m)
4675
4905
5150
5365
5655
5860
5880
6290
6372
6481
6557
GM
Seed
($m)
4476
5095
5855
7062
9150
10570
12870
15685
18495
20100
21054
Conventional
Seed
($m)
14524
14657
14485
14648
16870
17185
17950
18810
19065
19325
19497
3.6%
1.2%
4.7%
0.9%
Agrochemicals = $62,702 +3.3%
March 2015
3
Seed= $40,551 +2.9%
© PhillipsMcDougall
Industry Presentation
Crop Protection Market Outlook 2014
NAFTA:
Lower crop prices
Maize area -3.9%
Soybean area +10.9%
Canada wheat area -7.4%
Continuing dryness in south and west USA
Modest decline in glyphosate prices
Hard winter affects citrus and autumn planted
crops
US Registration review
Latin America:
Increased soybean and wheat area in
Brazil and Argentina, but decline for
maize
Dryness in Brazil in early 2014
Weaker Real affects Brazil crop exports
Increased GM uptake in Region
High inflation in Argentina
High interest rates in Brazil
Rising sugar and cotton price
Economic improvement drives
developing markets
World
Rising demand for crop commodities
Static to declining glyphosate prices
Crop prices weakening
Farm economies strong, after good
2013
Lower maize and soybean prices
Asia:
Japan: modest improvement
Further GM uptake in China and India
Drive for grain production in China
Quest for rice self sufficiency in
Malaysia and Indonesia
Lower palm oil and rice prices
Increasing food demand
Dry weather affects East Australia
Weak 2014 monsoon
Tax rise on agrochemicals in Japan
Africa / Middle East:
Modestly developing markets
Speciality crops for export
Improved political stability benefits North Africa
Political and infrastructure problems
Water availability
Growth Markets
March 2015
Europe:
Wheat price remains high
EU wheat area +3.2%
Oilseed area increased marginally
Re-registration under revised criteria
Mild winter promotes Autumn crop survival
Potential for high disease pressure
Good start to 2014 season
Wet summer in Central Europe
Static to Slow Growth
4
Static to Decline
© PhillipsMcDougall
Industry Presentation
Regional Crop Protection Market Development
$m
18000
16000
14000
12000
10000
8000
6000
4000
2000
0
Latin America
Asia
Europe
NAFTA
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
Africa / Middle East
March 2015
5
© PhillipsMcDougall
Industry Presentation
Crop Protection Market 2014 Analysis
Region
NAFTA
LAM
EUROPE
ASIA
World
March 2015
Nominal $ Growth
2014/2013
(%)
-4.4
13.1
1.8
1.6
3.6
6
Real Growth
2014/2013
(%)
-4.5
16.1
1.7
1.9
4.5
Constant Dollar Growth
2014/2013
(%)
-2.9
26.8
4.8
5.4
7.2
© PhillipsMcDougall
Industry Presentation
Growth of European Crop Protection Market
€m
11000
10000
9000
8000
7000
6000
CAP Reform Introduction of
Single Farm
Payments
5000
4000
3000
CAP Reform Introduction of
set-aside
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2000
March 2015
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© PhillipsMcDougall
Industry Presentation
Compound Annual Growth Rate of the European Crop Protection Market
(% p.a.) € Terms
2014/2009 2014/2004
2.6
3.1
5.8
8.0
6.8
9.6
EU15
New EU13
Other
March 2015
8
© PhillipsMcDougall
Industry Presentation
Top Twenty European Country Markets
Sales Growth in € Terms 2014/2009 (% p.a.)
Romania
Bulgaria
Russia
Ukraine
Poland
Hungary
UK
Spain
Switzerland
Italy
Portugal
Germany
Czech
Croatia
Denmark
Greece
Slovakia
Austria
France
Netherlands
Belgium
-5
March 2015
0
5
10
9
15
20
25
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30
Industry Presentation
Agrochemical Market Split by Product Category (2013)
Other, 3.0%
Other, 3.4%
Fungicide,
25.8%
Herbicide,
43.7%
Insecticide,
27.5%
Herbicide,
46.3%
Insecticide,
13.5%
Europe
World
March 2015
Fungicide,
36.8%
10
© PhillipsMcDougall
Industry Presentation
Agrochemical Market Split by Crop (2013)
35
World
% ofTotal Value
30
24.2%
25
20
16.7%
14.2%
15
11.7%
9.5%
10
8.8%
5.1%
4%
5
1.4%
1.3%
3.1%
0
35
34.6%
Europe
29.2%
% ofTotal Value
30
25
20
15
11.6%
9.5%
10
0.8%
1.1%
0
March 2015
11
4.9%
4.2%
3.7%
5
0.4%
0
© PhillipsMcDougall
Industry Presentation
European Agrochemical Market 2013
Key Crop Product Sectors
1800
4.1%
1600
4.2%
1400
Red values are CAGR in % from 2009 -2013
Sales (Euro m.)
1200
6.6%
1000
800
2.4%
600
7.1%
7.4%
400
15.1%
11.1%
3.6%
5.5%
200
0
March 2015
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Industry Presentation
Crop Commodity Prices
March 2015
13
© PhillipsMcDougall
Industry Presentation
Indicative Global Trade Commodity Prices 1998-2014
$/Tonne
Annual Average
600
Soybean
500
Rice
400
300
Wheat
Maize
200
100
Cottton (cents/lb)
0
1998
1999
March 2015
2000
2001
2002
2003
2004
2005
14
2006
2007
2008
2009
2010
2011
2012
2013
2014
© PhillipsMcDougall
Industry Presentation
GM Seed Market 2014
March 2015
15
© PhillipsMcDougall
Industry Presentation
GM Trait Introductions Since 1995
GM Planted Area
New GM Seed Products
500
14
12
Planted area (million acres)
400
10
350
300
8
250
6
200
150
4
100
2
50
0
0
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
16
2003
2002
2001
2000
1999
1998
1997
1996
1995
March 2015
© PhillipsMcDougall
Number of trait product introductions
450
Industry Presentation
Crops Planted with GM Varieties in 2014
NAFTA 46.4%
Canada
Canola – 91.5%
Soybean – 91.7%
USA
Soybean – 96.0%
Maize – 93.1%
Cotton – 99.5%
Canola – 91.0%
Sugar beet – 98.1%
Asia 11.4%
China
Cotton – 82.8%
Argentina
Soybean – 96.9%
Maize – 90.7%
India
Cotton – 97.2%
Brazil
Soybean – 91.2%
Maize – 85.4%
Rest of World 1.5%
Latin America 40.7%
Total = 441.9 million acres (+3.5% over 2013)
March 2015
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© PhillipsMcDougall
Industry Presentation
Agrochemical Industry Structure and R&D Focus
March 2015
18
© PhillipsMcDougall
Industry Presentation
Company Sales Increases 2014 (preliminary)
US $ % sales change over 2013
Company
Syngenta
Bayer
BASF
Dow
Monsanto
DuPont
FMC
Cheminova
KWS
Vilmorin
Agrochemical
4.0
6.9
4.2
3.0
13.1
4.0
1.3
2.2
Seed and Traits
-1.0
13.4
n/a
-0.6
3.9
-7.0
n/a
n/a
n/a
n/a
7.9
7.0
Note –results are for company fiscal year
March 2015
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© PhillipsMcDougall
Industry Presentation
Crop Protection Company Market Shares 2013
Market Share
>15%
15% - 5%
5% - 1%
1%-0.5%
<0.5%
European
Bayer
BASF
Cheminova
Sipcam Oxon
Isagro
Syngenta
Helm
Phyteurop
Agriphar
USA
Dow
FMC
Chemtura
Monsanto
Platform Specialities
Amvac
DuPont
Japan
Albaugh
Gowan
Sumitomo Chemical
Ishihara
Agro Kanesho
Arysta
Kumiai
SDS Biotech
Nihon Nohyaku
OAT Agrio
Nippon Soda
Nippon Kayaku
Nissan
Kyoyu Agri
Hokko
Mitsui Chemicals
Other
Adama
Red Sun
Rotam
Nufarm
Wynka
Rallis
UPL
Sinon
Sinochem
Excel
Nutrichem
Gharda
March 2015
20
© PhillipsMcDougall
Industry Presentation
Company Sales and R&D Expenditure 2013
Agrochemicals
Seed and Traits
12000
10000
Sales $m.
8000
6000
4000
2000
0
Monsanto DuPont
Syngenta
BASF
Dow
Bayer
Monsanto
Syngenta
BASF
Dow
Bayer
1800
R&D Expenditure $m.
1600
1400
1200
1000
800
600
400
200
0
March 2015
DuPont
21
© PhillipsMcDougall
Industry Presentation
R&D expenditure of Leading Agrochemical Companies
4000
3500
Agrochemical
US$ million
3000
2500
2000
Seed & Trait
1500
1000
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
March 2015
22
© PhillipsMcDougall
Industry Presentation
Cost of Bringing a New Product to Market
Agrochemical
Plant biotechnology trait
300
300
Total = $256 m.
250
200
32
Development
54
Field Trials
Chemistry
36
100
11
32
50
Research
200
Environmental Chemistry
Toxicology
Tox/Env chemistry
Introgression breeding &
testing
150
100
13.6
50
42
0
0
Agrochemical
Commercial event
production
Construct optimisation
Late discovery
28.3
13.4
17.6
Early Discovery
Crop Biotech trait
Agrochemical costs based on 2009 Crop Life America/ECPA study
March 2015
17.2
17.9
28
Biology
Chemistry
Registration & Regulatory
Affairs
Regulatory Science
Registration
$ million
$ million
250
25
24
150
Total = $136 m.
23
Plant biotechnology trait costs based on 2011 Crop Life International study
© PhillipsMcDougall
Industry Presentation
Agrochemical Active Ingredients in Development
a.i.s in development
80
70
60
50
40
30
20
10
0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
March 2015
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© PhillipsMcDougall
Industry Presentation
Future Developments in Agrochemical and Seeds
Input Traits - Maize, Soybean, Cotton, Canola
o Additional herbicide tolerant traits – dicamba, 2,4-D (Enlist), HPPD
o Insect resistant traits for soybean
o Expansion of insect coverage from new insect resistant traits –
e.g.VIP
Output traits
o Drought / Stress tolerance/ Abiotic stress
RNAi
Precision Agriculture
March 2015
25
© PhillipsMcDougall
Industry Presentation
Patents for Abiotic Stress 2009-2013
250
Other Institutions
Big Six Multinationals
Number of Patents
200
150
100
50
March 2015
26
2013
2012
2011
2010
2009
0
© PhillipsMcDougall
Industry Presentation
Patents for Abiotic Stress 2009-2013
25
20
Temperature
Stress
15
Water Stress
10
March 2015
27
Dow
Bayer
Unclassified
Monsanto
0
Syngenta
Multiple
BASF
5
DuPont
Pioneer
Number of Patents
Salt Stress
Other
© PhillipsMcDougall
Industry Presentation
RNAi – Gene Silencing
Ribonucleic acid interference (RNAi) is a method of gene silencing in target organisms
Potential applications of RNAi in agriculture include:
•
In-plant insect protection – e.g. corn rootworm
•
Foliar spray / seed treatments
•
Weed Control
March 2015
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© PhillipsMcDougall
Industry Presentation
Precision Farming Applications
Farm
Management
• Singulation and Spacing
• Variable Rate Application
• Steering Guidance and
Autosteer Systems
• Display Screen
•
•
•
•
•
Data Analysis
GPS Systems
Agronomic Advice
Wireless Connectivity
Irrigation
Agchems
&
Fertiliser
Seed
• Variable Rate Application
• Chemical/Nutrient Application
• Steering Guidance and
Autosteer Systems
• Display Screen
Precision
Farming
•
•
•
•
•
Soil Analysis
Remote Sensing
Field Sensors
Mapping
Weather
March 2015
Field
Monitoring
29
Harvest
• Yield monitor
• Display Screen
• Steering Guidance and
Autosteer Systems
© PhillipsMcDougall
Industry Presentation
Market Environment in 2015
March 2015
30
© PhillipsMcDougall
Industry Presentation
Monthly Crop Prices
400
700
Corn
Soybean
350
600
Futures
250
Futures
US $ per tonne
US $ per tonne
300
500
400
200
300
150
100
200
J MM J S N J MM J S N J MM J S N J MM J S N J MM J S N J MM J S N J MM J S N J MM
2009
2010
2011
2012
2013
2014
2015
J MM J S N J MM J S N J MM J S N J MM J S N J MM J S N J MM J S N J MM J S N J MM
2016
2009
Rapeseed
600
2010
400
2011
2012
2013
2014
2015
2016
Wheat
550
350
Futures
Futures
300
450
US $ per tonne
€ per tonne
500
400
350
250
200
300
150
250
200
100
J MM J S N J MM J S N J MM J S N J MM J S N J MM J S N J MM J S N J MM J S N J MM
2009
2010
March 2015
2011
2012
2013
2014
2015
31
2016
J M M J S N J M M J S N J M M J S N J M M J S N J M M J S N J M M J S N J M M J S N J M
2009
2010
2011
2012
2013
2014
2015
© PhillipsMcDougall
2016
Industry Presentation
Maize Prices 2010 - 2016
USDA
$8.4 bushel
350
300
US $ per tonne
250
Futures
200
150
$4.1 bushel
$4.1 bushel
100
50
J M M J S N J M M J S N J M M J S N J M M J S N J M M J S N J M M J S N J M M
2010
March 2015
2011
2012
32
2013
2014
2015
2016
© PhillipsMcDougall
Industry Presentation
Wheat Prices 2012 - 2016
€ 274 /T
290
270
250
€ per tonne
Futures
230
210
€183 / T
190
170
150
March 2015
33
© PhillipsMcDougall
Industry Presentation
Crop Protection Market Outlook 2015
NAFTA:
Lower crop prices
Maize area expected to decline
Soybean area anticipated to rise
Record EtOH production in 2014
Continuing dryness in south and west USA
Modest decline in glyphosate prices
Hard 2014/15 winter
US Registration review
Latin America:
Increased soybean but decline for maize
and wheat area in Brazil and Argentina,
Dryness in Brazil in early 2015
Weaker Real affects Brazil crop exports
Increased GM uptake in Region
High inflation in Argentina
High interest rates in Brazil
Weaker sugar and cotton price
Economic improvement drives
developing markets
World
Sustained demand for crop commodities
Weakening glyphosate prices
Crop prices depressed
Farm economies weakening
Asia:
Japan: modest improvement
Further GM uptake in China and India
Drive for grain production in China
Quest for rice self sufficiency in
Malaysia and Indonesia
Low palm oil, but rising rice prices
Increasing food demand
Dry weather affects East Australia
Africa / Middle East:
Modestly developing markets
Speciality crops for export
Improved political stability benefits North Africa
Political and infrastructure problems
Water availability
Growth Markets
March 2015
Europe:
Wheat price weakening
CAP reformed to Basic Payment Scheme
Ecological Focus Areas – Non cultivated land
EU-15 wheat area expected to decline
Re-registration under revised criteria
Mild winter promotes Autumn crop survival
Potential for high disease pressure
Static to Slow Growth
34
Static to Decline
© PhillipsMcDougall
Industry Presentation
European Market Outlook
Short term:
Futures Crop prices reduced but potential for further volatility
Challenging economic environment
Agrochemical Prices
Changes in EU CAP
Longer term:
Increasing demand for grain and oilseed crops
Agrochemical product re-registration
Resistance and regulatory issues create opportunities for new
products
New farming technologies
March 2015
35
© PhillipsMcDougall
Industry Presentation
Disclaimers
The information contained in this presentation constitutes our best judgement at the
time of publication, but is subject to change. Phillips McDougall do not accept any
liability for any loss, damage or any other accident arising from the use of the
information in this presentation.
The information given in this presentation has been drawn from analyses and reviews
presented in the Phillips McDougall products AgriService, Seed Service, AMIS Global
and AgreWorld.
Phillips McDougall maintain a wide range of databases covering the crop protection and
seed industries, this presentation presents only headline information. Access to these
databases can be gained through subscription or consultancy. Our market research
databases track product sales from global market totals down to brand level sales by
crop and country in both volume, value and area treated terms.
For more information about these products please visit
www.phillipsmcdougall.com
www.agreworld.com
March 2015
36
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