The Agrochemicals Market is Pivoting Towards Sustainable Farming Practices

The agrochemicals market primarily consists of crop protection chemicals including herbicides, insecticides and fungicides that are used to maximize crop yields and quality. These chemicals play a vital role in boosting global food production. However, there is a growing need to transition towards more sustainable agricultural systems given environmental and health concerns related to excessive use of agrochemicals.

The Global Agrochemicals Market is estimated to be valued at US$ 81.27 Bn in 2024 and is expected to exhibit a CAGR of 6.2% over the forecast period 2023 to 2030.

Key Takeaways

Key players operating in the Agrochemicals market are ADAMA Ltd., Arysta Life Science, Bayer AG, Isagro Spa, K+S Aktiengesellschaft, Nufarm, Nutrien Ltd, OCI Nitrogen, Sociedad Quimica Y Minera De Chile, and The Mosaic Company among others.

Rising global population and the consequent need to increase agricultural outputs is fueling demand for agrochemicals. However, there is also a growing preference for organic and sustainable farming practices which could limit market growth to some extent.

Asia Pacific presently dominates the agrochemicals market owing to large cropland areas and rising incomes in the region which is driving higher pesticide and fertilizer use. However, companies are also expanding in Latin America and Africa driven by strong crop production growth prospects.

Market key trends

One of the key trends gaining traction in the agrochemicals market is the rising preference for biopesticides and biofertilizers. Biopesticides are derived from natural materials like animals, plants, bacteria and certain minerals and are considered more environment-friendly than synthetic chemical pesticides. Their use is expected to grow significantly driven by changing consumer and regulatory focus on reducing health and environmental risks. This shift towards more sustainable farming practices is expected to reshape competitive dynamics in the agrochemicals industry in the long run.

Porter’s Analysis
Threat of new entrants: There are moderate barriers to entry due to heavy investments in R&D and manufacturing facilities.

Bargaining power of buyers: Buyers have low bargaining power due to availability of diversified product ranges from various agrochemical companies.

Bargaining power of suppliers: Suppliers have moderate bargaining power due to the presence of a large number of suppliers for raw materials.

Threat of new substitutes: There is a moderate threat from new substitutes due to stringent regulation on usage of agrochemicals and development of biofertilizers.

Competitive rivalry: The rivalry among existing competitors is high due to the presence of many national and multinational companies offering varied product portfolios.

Geographical Regions
North America holds the major share of the agrochemicals market, globally, both in terms of value and volume. Factors such as relatively large area under agriculture, growing acceptance of modern farming techniques, and high per hectare chemical usage are driving the agrochemicals market in the region.

Asia Pacific is projected to be the fastest-growing market during the forecast period, backed by the rapidly growing population in countries such as India and China. Rising agriculture production to meet the increasing demand for food coupled with a growing consumer preference for chemical-free and organic foods