Agrochemicals Market

Market Overview

The global agrochemicals market size was USD 221.38 billion in 2021 & is projected to reach USD 286.08 billion by 2030 at a CAGR of 2.89% from 2022 to 2030.

Agrochemicals are designed chemical or biological compositions that are used to enhance crop quality and productivity. Fertilizers and insecticides are two types of agrochemicals. Pesticides protect crops by killing or repelling pests and weeds that could harm them, whereas fertilizers improve the quality of the crop by supplying needed nutrients to the crop and soil. Increasing agricultural output in arable land to feed the world's growing population is critical in light of current global population trends. As a result, agrochemicals serve a critical role in agriculture, helping farmers improve the quality and quantity of their harvest.

Global population growth and the consequent rise in food consumption, soil degradation, scarcity of arable land, and growing consumer knowledge of the advantages of agrochemicals are all driving forces in the global agrochemicals market. Synthetic pesticides like 2, 4-D, and atrazine herbicides, which have the potential to cause harm, may slow the expansion of the industry. Higher concentrations of agrochemicals can cause surface water pollution and harm the environment. Many opportunities have opened up as a result of bio-based fertilizer and pesticide production.

Market Dynamics

Market Drivers

A Rise in The Use of Agricultural Chemicals in Emerging Nations

In agriculture, technological improvements have shifted farming practices. New forms of dangerous organisms have emerged as a result of the growing export and import of agricultural commodities, particularly in developing nations, resulting in an increase in the demand for novel active component products to protect crops.

The agrochemical industry's globalization has had a profound effect on Asian crop protection markets. Growing populations, higher food demands, and an expanding economy are driving up demand for a wide range of agrochemicals, such as herbicides and pesticides. There is a growing need for food goods, but the landmass for agriculture is reducing as a result of urbanization, which forces farmers to utilize a wide range of agricultural chemicals to maintain soil health and boost output.

Development For the Purpose of Enhancing Agricultural Productivity

Demand has been significantly boosted in the international agrochemicals sector thanks in large part to the government's efforts. Farmers are expected to contribute to the government's efforts in exchange for financial assistance in the form of subsidies and tax breaks. Countries that rely heavily on agriculture for their means of subsistence are the ones that have the most need for improved fertilizers. Under these conditions, it is anticipated that the total revenue volume generated by the global market will increase. The cultivation of cash crops often involves the use of agrochemicals, which has contributed to the expansion of the market for agrochemicals over the course of the forthcoming time period.

Market Restraints

Increasing Market Share in Organic Fertilizer

The market for organic food in developing countries has been rapidly expanding thanks to an increased awareness of the importance of adhering to standards concerning health, the safety of food, the conservation of the environment, and the welfare of animals. The consumption of organic food is seeing a rising trend in popularity. It is anticipated that the spike in demand for nutritious and risk-free food items, as well as rising per capita income, would drive the organic food sector and raise the usage of biofertilizers, both of which will have an impact on the composition of chemical fertilizer. As a direct consequence of this, the expansion of the organic fertilizer industry is working against the expansion of the global market over the course of the forthcoming decade.

Market Opportunites

Recent Developments in Research Conducted by Agricultural and Chemical Industries

It has been discovered that insecticides and pesticides help crops develop more quickly. The development of synthetic pesticides as a means to accelerate the planting and cultivation process has contributed significantly to the expansion of the market for agrochemicals. In addition, numerous agricultural experts are of the opinion that one of the best ways to increase crop yields is to make use of organic fertilizers. Farmers and other agriculturalists have a responsibility to ensure that the resources they have access to be utilized to the best of their abilities. Because of this, these organizations put in an incredible amount of effort to acquire seeds and fertilizers of the highest possible quality. Therefore, the progress that has been made in the research conducted by the agricultural and chemical sectors is offering lucrative chances for the expansion of the global market during the course of the projection period.

Regional Analysis

The global agrochemicals market share is segmented by geography into North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa.

In 2021, Asia Pacific was the dominant geographical market, accounting for 30% of total sales. The region is the leading agricultural producer around the globe. India, China, and Japan all play a significant role in the regional market. China is the world's largest exporter and manufacturer of pesticides, according to the International Trade Center (ITC) and the Food and Agriculture Organization (FAO). India, behind China, Japan, and the United States, is the world's fourth-largest producer of agrochemicals, according to the OECD and FAO. Agriculture accounts for the majority of the region's per capita revenue.

In 2021, Asia Pacific had the highest revenue share of almost 30%. The existence of large crop-producing countries accounts for this substantial share. China is a major consumer, exporter, and producer of fertilizers and pesticides. In agriculture, China is the world's largest consumer of pesticides. It uses one-third of the world's insecticides and fertilizers and produces 85% of all technical raw materials.

By 2030, the region will produce more than half of the world's agricultural and fish products. The region's population is expected to increase by 320 million people by 2030, with a CAGR of 0.7 percent. Arable land is dwindling as a result of rising population, fast urbanization, and industrialization. As a result, farmers look for agrochemicals that boost productivity and production. The United States is significant food production and ranks in the top ten countries in terms of geography.

The Asia Pacific is one of the world's fastest-growing regions. With fast-growing countries like China and India, the region is set to be a leader in agriculture, manufacturing, pharmaceuticals, and food and beverage production. The region is known for its low-cost labor and abundant raw materials. Water scarcity, climate change, and soil degradation are all major challenges for Asia Pacific agriculture.

The second-largest market share belongs to North America. Maize, sorghum, blueberries, and almonds are all produced in large quantities in North America. The United States is a major producer, consumer, and exporter of agrochemicals. The market is also driven by better grain commodity pricing, favorable weather patterns, and easing trade fears with China. Drought conditions in the West have increased miticide demand.

Due to increased demand for commodities such as maize, sorghum, soybean, and blueberry, the United States dominated the North American agrochemicals sector. Maize, sorghum, blueberries, and almonds are also produced in large quantities in the United States. It's also the world's second-largest soybean producer, trailing only Brazil. These are the major factors fueling the country's market growth. According to the FAO, the United States is a major producer, consumer, and exporter of agrochemicals. Agrochemical expansion in the country is being aided by improved grain commodity prices, favorable weather patterns, and reduced trade issues with China.

Segmental Analysis

The global agrochemicals market share is divided into different segments according to the Product, Application and Region (Geographies).

By Product

The global agrochemicals market is segmented into Fertilizers, Plant Growth Regulators and others. In 2021, fertilizer accounted for 69.2% of global revenue. Fertilizers boost crop output quickly. Growing crop/food demand worldwide puts strain on agricultural land; thus, farmers use more fertilizers to boost crop productivity and yield. Fertilizers include nitrogenous, phosphatic, potassium, and secondary fertilizers. Nitrogenous fertilizer is likely to grow the most.

Nitrogen fertilizers boost plant growth and yields. Using more nitrogenous fertilizers harms the ecosystem, notably waterways. In terms of revenue, the crop protection chemicals industry is predicted to increase quickly. Insecticides, fungicides, herbicides, rodenticides, bactericides, etc. are crop protection chemicals. Herbicide dominates crop protection chemicals. Agriculture uses herbicides widely. They're employed to control crop weeds.

By Application

The global agrochemicals market is segmented into Cereal & Grains, Fruits & Vegetables and others. In 2021, cereal & grains had a 49.8% market share. Cereal & grains are Asia Pacific's most consumed crops. Cereals and grains are cultivated globally. Cereals and grains almost always need fertilizer. Increasing cereal and grain consumption in other regions drives demand for fertilizers. Rice, wheat, and other crops utilize the most agrochemicals.

Soil nutrient deficit can reduce wheat and rice yields by reducing bioavailable nutrients. Fruits & vegetables are predicted to have the highest CAGR. This growth is due to customers' increasing health consciousness and desire for fresh fruits and vegetables. Agrochemicals help fruits and vegetables flourish. Pesticides help farmers produce safe, high-quality, cheap fruits and vegetables.

By Geography

The global agrochemicals market is segmented into North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa. The Asia Pacific had a 30% revenue share in 2021. Large crop-producing countries account for this significant percentage. World's largest agricultural producer. India, China, and Japan are regional market contributors. China is a major consumer, exporter, and producer of fertilizers and insecticides. China's agriculture uses the most pesticides. India is the fourth-largest producer of agrochemicals after China, Japan, and the U.S. Agriculture drives the region's per capita income.

North America produces maize, sorghum, blueberries, and almonds. The U.S. produces, consumes, and exports agrochemicals. Better grain prices, favorable weather, and diminishing trade concerns with China also drive the market. Western U.S. drought has also boosted miticide consumption. Growing demand for commodities like maize, sorghum, soybean, and blueberry helped the U.S. dominate the North American agrochemicals market.

Recent Developments

• June 2022 - Azolla Ventures I and Chrysalix Venture Capital's Carbon Neutrality Fund are two sustainability funds in which Evonik Venture Capital has invested. Both businesses are researching CO2 reduction technology, with Azolla focusing on North America and Chrysalix on the rest of the world. This is the first investment made by Evonik's venture capital arm with the new €150 million Sustainability Tech Fund. The amount of the investment has been agreed upon by all parties.
• May 2022 - New revolving credit facility (the "Credit Facility") for Huntsman International LLC of $1.2 billion has been announced by Huntsman Corporation, which replaces an existing senior unsecured revolving credit facility of that same amount that expires in May 2023.