In 2017, Asia, North America, and South America accounted for the highest market share in the pesticide and other agricultural chemicals market.
Typically, the market for agricultural chemicals includes companies that offer a broad range of products such as pesticides, insecticides, herbicides, fungicides, hormones, synthetic fertilizers, and other chemical growth agents. Such chemicals are used to control the growth of weeds, insects, disease, and pests. They are also used to enhance crop growth and production.
Factors such as advancements in technology to boost production coupled with increasing government investments for farmer protection and increasing crop yields offer huge opportunities for growth, especially for companies manufacturing agricultural chemicals. Additionally, factors such as the increasing population of developing countries and their subsequent demand for food products will result in the extensive use of agricultural chemicals in the coming years.
However, agricultural chemicals manufacturers are facing challenges in terms of:
- Unanticipated variations in commodity prices: Over the years, energy costs have been rising, but in the recent years, the industry has witnessed the emergence of cheaper forms of energy. Therefore, agricultural chemicals companies are required to have a robust ERP system that will help them respond to fluctuations in energy costs quickly.
- Formula costs: The availability of raw materials to agricultural chemicals manufacturers is affected by factors such as the cost of purchase, seasonality, and maintenance constraints, etc. However, agricultural chemicals manufacturers have to ensure that they procure the precise materials with the required specifications to comply with the standards of the formulations.
Market access solutions help companies in the agricultural chemicals manufacturing space to accelerate new product development cycles, effectively access new markets and customers, and improve their competitive positioning. These solutions also help companies expand their competencies without the added steps of snowballing business risks, creating in-house capabilities, or by carrying extra costs on the balance sheet.
The Business Challenge
- The Client: A prominent agricultural chemicals manufacturer
The client, a prominent agricultural chemicals manufacturer with business operations spread across the APAC region, wanted to build an approach to devise robust strategic partnerships that would not leave them reliant on the performance and commitment of a single partner. The chemicals manufacturer also wanted to leverage market access solutions to build strategic partnerships with suppliers to devise and develop superior market access strategies.
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The experts at Infiniti followed a blended approach including discussions and interviews with leading stakeholders in the chemicals industry space and analyzed relevant pieces of information to deliver valuable insights to the client. The specialists also compiled information from various secondary resources such as paid industry databases, company presentations, and industry forums.
The Solution and the Business Impact
With the help of Infiniti’s market access engagement, the agricultural chemicals manufacturer was able to devise and develop a superior market access strategy. The client was also able to identify the best potential partners and profitable business opportunities in the chemical industry. In a span of 12 weeks, we were able to offer key insights to the chemicals manufacturer, which helped them to identify new market segments and strategies to boost operational efficiency.
With the emergence of some new species of pests, adoption of GM crops, and change in cropping acreage, the agricultural chemicals market will go through a multitude of changes in the coming years.