Agrochemical Intermediates Market

Market Overview

The global agrochemical intermediates market size was valued at USD 4.2 billion in 2023 and is projected to reach USD 6.5 billion by 2032, registering a CAGR of 5.4% during the forecast period (2024-2032). The primary driver of market growth is the combination of increasing population and government subsidies in emerging economies that support expanding agricultural operations. 

Agrochemical intermediates are widely used to produce pesticides, including herbicides, fungicides, and insecticides. Some common examples of agrochemical intermediates include 4-fluoro toluene Diethyl Phosphorochloridothionate, 2-chloro-6-(Trichloromethyl) Pyridine, 2-chloro-5-chloro Methyl Pyridine, and 2-Chloropropionic Acid. Amines, alkylamines, aldehydes, and acids are the agrochemical intermediates that end users most frequently utilize.

The market growth of agrochemical intermediates is primarily driven by several factors, including emerging environmental concerns, increasing commercial value, rising demand for organic compost, favorable government policies, technological advancements, and the global increase in agriculture activities due to the growing demand for food and population.

Highlights

• Aldehyde generates the highest revenue share based on product.
• Synthetics influenced the market growth by type.
• Herbicides generate the highest revenue share based on end users.
• Distributors influence market growth through distribution channels.

Market Dynamics

Market Drivers:

Increasing Global Demand for Food 

The exponential expansion of the worldwide population requires a proportional augmentation in food production, and agrochemical intermediates play a crucial role in enabling farmers and agricultural producers to fulfill this escalating demand by facilitating the manufacturing of agrochemicals such as fertilizers and pesticides. These intermediary substances aid in maximizing agricultural productivity, so guaranteeing a consistent and abundant food provision. 

Additionally, the agrochemical intermediates market is intricately connected to the need for food production. The need for agricultural products has consistently increased as the world population grows gradually. The latest estimate from the UN indicates that there are 7.3 billion individuals. By the year 2050, the global population is projected to increase to 9.7 billion. The increase in population, along with the upward trend in earnings in developing nations, leading to shifts in dietary patterns such as increased protein and meat consumption, is contributing to the surge in global food demand—the projected rise in food demand by 2050 ranges from 59% to 98%. Agrochemicals are essential for maximizing crop production and maintaining a reliable and abundant food source. They provide vital nutrients and safeguard crops from pests and diseases, substantially contributing to global food security. Hence, the increasing population propels the market growth.

Adoption of Modern Farming Techniques

Agrochemical intermediates, such as insecticides and fertilizers, are crucial in manufacturing agrochemicals. These substances are vital in increasing crop productivity and safeguarding crops against pests. The agriculture sector is transforming with the implementation of contemporary farming methodologies. The National Institute of Food and Agriculture states that technological innovations have significantly improved modern farming and agriculture. These improvements have increased agricultural operations' profitability, efficiency, safety, and environmental friendliness.

Similarly, there is an increasing prevalence of precision agriculture, data-driven farming practices, and the utilization of modern machinery. The agricultural landscape is undergoing rapid transformation due to the extensive implementation of contemporary farming methods, including precision agriculture. Precision agriculture utilizes advanced technology and data-driven approaches to improve decision-making and resource management. Agrochemical intermediates play a crucial role in this transition by supplying the necessary basic materials for advanced agrochemicals that optimize the health and productivity of crops, fostering market growth.

Market Restraints:

Environmental Sustainability and Cost Restraints

The agrochemical intermediates market has several limitations and obstacles that can affect its growth and progress, particularly regarding environmental issues. Environmental sustainability and ecological effects are significant considerations in contemporary agriculture, and the utilization of agrochemicals, including intermediates, might have unforeseen repercussions on the environment. Potential concerns include the pollution of soil, water, and air and the exposure of unintended organisms.

Furthermore, the agrochemical industry is heavily regulated to mitigate the potential hazards of chemical use in agriculture. Complying with regulatory standards and obtaining necessary approvals can be laborious and expensive for agrochemical intermediary manufacturers. Research and development (R&D) expenditures for manufacturing new agrochemical intermediates might be considerable. It necessitates a significant investment to produce novel and eco-friendly formulations while ensuring their effectiveness and safety.

Market Opportunity:

Rising Need for Pest and Disease Control 

Efficient control of pests and diseases is crucial for maintaining the well-being and yield of crops and Agrochemical intermediates. It is the essential basis for developing pesticides, including insecticides, herbicides, and fungicides. Efficient control and prevention of pests and diseases are crucial elements of thriving agriculture. Agrochemical intermediates play a vital role in this effort as they are utilized to produce a variety of pesticides, such as insecticides, herbicides, and fungicides. These chemical solutions protect crops from harmful pests, illnesses, and invasive weeds. 

Additionally, the global use of pesticides in agriculture is projected to experience modest growth in the coming years. It is expected to rise from approximately 4.3 million metric tons in 2023 to about 4.41 million in 2027. In 2021, the Americas accounted for over 50% of the global pesticide consumption, making it the region with the highest usage of agricultural pesticides. These chemical remedies protect crops from harmful pests, illnesses, and invasive weeds, preserving their quality and quantity. Farmers may sustain the vitality and excellence of their crops by utilizing these agrochemicals prudently, consequently guaranteeing a dependable and uniform agricultural yield.

Regional Analysis

The global agrochemical intermediates market analysis is conducted across North America, Europe, Asia-Pacific, the Middle East and Africa, and Latin America.

Asia-Pacific Dominates the Global Market

Asia-Pacific is the most significant global agrochemical intermediates market shareholder and is estimated to grow at a CAGR of 5.2% over the forecast period. The Asia-Pacific region is the largest and most rapidly expanding agrochemical intermediary market. This region is distinguished by its substantial population, high agricultural output, and considerable agricultural industry. Countries like China and India possess significant marketplaces due to their sizable populations and solid agrarian sectors. By 2023, it is projected that 60% of the global population will reside in the Asia-Pacific area, indicating a continued growth in its population. 

In addition, by 2055, the region's population is expected to reach 5.25 billion, accounting for approximately 54% of the global population. The area is projected to experience population growth due to its advantageous demographics, with 600 million individuals between the ages of 15 and 24, with certain countries, such as India and various Southeast Asian countries, benefiting from an increasing number of young individuals. Nevertheless, many regional economies, such as China, Japan, and the Republic of Korea, face increasing aging populations. Several factors, including a growing population, a rising demand for food, and a significant agricultural industry, influence the market in this region.

North America is estimated to grow at a CAGR of 5.6% over the forecast period. The agrochemical intermediates market in North America is mature and well-established. Modern agricultural methods, a high per capita agrochemical intermediate use, and a well-developed regulatory framework distinguish it. For example, Cargill supports farmers in implementing procedures and systems fundamental to regenerative agricultural practices. This initiative will cover 10 million farmland in North America within ten years. The United States dominates the market in this region, holding a substantial portion of agricultural production.

The European agrochemical intermediates market is distinguished by extensive agricultural production and sophisticated farming technologies. This region prioritizes environmental laws, which stimulate the creation of sustainable and environmentally friendly agrochemical products. European countries have strict regulations that restrict the use of agrochemical intermediates.

Segmental Analysis

The global agrochemical intermediates market is segmented based on products, types, end-users, and distribution channels. 

The agrochemical intermediates market is segmented based on products into alkylamines, amines, aldehydes, and acids.

The aldehyde segment dominated in 2023. Aldehydes play a crucial role in expanding the worldwide agrochemical intermediate market. They act as necessary starting materials in producing different types of pesticides, herbicides, and fungicides. This helps to improve agricultural output and tackle food security challenges in the face of increasing global population and changing climate conditions.

The amines segment is the fastest growing. Amines are vital components in the worldwide agrochemical intermediate market as they serve as fundamental building blocks in producing herbicides, pesticides, and fungicides, contributing significantly to market growth. Their chemical adaptability and responsiveness enable the creation of diverse agrochemicals, promoting innovation and effectiveness in agricultural methods.

Based on type, the market is segmented into Synthetic and Bio-Based. 

The synthetic segment dominated in 2023. Synthetic agrochemical intermediates are chemically synthesized compounds widely used in agriculture due to their extensive availability, versatility, and established presence in the market. These compounds are artificially created through chemical reactions and have a longstanding history of use. 

The bio-based segment is the fastest growing. Bio-based agrochemical intermediates from natural and renewable resources are becoming increasingly popular. This is due to growing consumer awareness of their environmental advantages and a preference for sustainable and eco-friendly products. As a result, this sector is projected to undergo significant expansion shortly. However, there is a predicted substantial growth in demand for bio-based intermediates due to rising awareness of environmental benefits and consumer desire for sustainable products.

The market is segmented into insecticides, herbicides, and fungicides based on end-users.

The herbicides segment dominated in 2023. Herbicides dominate the market as they are in high demand for weed control. Herbicides significantly contribute to the global agrochemical intermediate market's growth by effectively controlling weed populations, thus ensuring higher crop yields and quality. Their widespread adoption is driven by the necessity for efficient agricultural practices to meet the food demands of an increasing global population. Technological advancements in herbicide formulations, including selective and non-selective variants, and the development of herbicide-resistant crops enhance their utility. Regulatory measures focused on environmental sustainability and integrated weed management practices influence market trends. Consequently, herbicides are pivotal in modern agriculture, propelling the agrochemical intermediate market's expansion.

The insecticides segment is the fastest growing. The industry experiencing the most rapid growth is the one that deals with insecticides and fungicides. Insecticides are chemical substances employed to manage or eradicate insect pests that have the potential to inflict harm upon crops. They safeguard crops against insects such as beetles, caterpillars, and aphids.

The fungicides segment is the second largest. Fungicides are chemical substances utilized to manage and suppress fungal diseases that can potentially harm crops. They effectively prevent and treat diseases caused by fungi, including mildew, rust, and blight. Fungicides play a crucial role in the growth of the global agrochemical intermediate market by safeguarding crops from fungal diseases, thereby enhancing yield and quality. Advances in fungicide formulations, including bio-based and integrated pest management solutions, further boost market expansion. Additionally, regulatory frameworks promoting environmental safety and the development of resistant crop varieties influence market dynamics, making fungicides indispensable in modern agricultural practices and a vital driver of the agrochemical intermediate market's growth.

Based on distribution channels, the market is segmented into Direct Sales, Distributors, Wholesalers, and Online Retailers.

The distributor's segment dominated in 2023. They are vital in expanding manufacturers' customer reach and enhancing their supply chain efficiency. Distributors serve as intermediaries connecting manufacturers with end-users. They acquire substantial amounts of agrochemical intermediates from manufacturers and distribute them to retailers, wholesalers, and farmers. Retailers, such as agricultural supply stores and online marketplaces, serve as intermediaries connecting end-users with manufacturers. 

The online retailer's segment is the fastest growing. Additionally, as agriculture becomes more digitized, online markets are emerging as a swiftly expanding distribution route. Distributors and wholesalers are essential in the agrochemical intermediates market as they help manufacturers grow their client reach and streamline their supply chain. Retailers, such as agricultural supply stores and online marketplaces, are crucial in facilitating the connection between manufacturers and end-users. 

Recent Developments

• February 2024– Corteva, a multinational corporation, introduced two new crop protection products at Show Rural 2024 in Brazil. AgroPages reported this event. One notable feature is the herbicide Gapper (Florpirauxifen-benzil), employed to manage weed growth in maize and soybean fields. Another announcement made during the Show Rural is the introduction of the herbicide Elevore (Halauxifen-methyl), specifically to desiccate soybean plants during sowing. 
• April 2024– Atul Ltd, a chemical business combining several processes, introduced its own formulation, Sindica, which is a herbicide applied after the weeds have emerged, specifically targeting the most significant weeds that affect sugarcane crops.