China’s insecticides market is facing huge transformation and challenges 05-16-2017

The insecticides industry in China is in a huge transformation these days. Influenced by increasing production costs, environmental inspections, and rising resistance, the market is facing serious difficulties, while new opportunities arise. (Originally published in the May/June issue of Speciality Chemicals).

Source: Pixabay

Since the peak in 2012, China’s output of insecticides is falling constantly. Hence, the year 2016 has witnessed another fall. However, the fall in 2016 was the smallest one in four years, which may indicate an end for the declining industry trend.


The output of the pesticides industry in China, on the other hand, was increasing 1% compared to 2016, due to the uprising trend of herbicides and fungicides. As a fact, the insecticides industry is losing share of the total pesticides amount in China continuously. Accounting for 31.79% of all pesticides in 2009, the share declined ongoing to 13.42% in 2017.


Figure 1:China's insecticide output, 2010-2016, 1,000 tonnes


Source: National Bureau of Statistics of the People’s Republic of China


What’s more, the production of insecticides is highly concentrated in some areas in China. As a result, the top three regions are responsible for 72.08% of the total output. The leading manufacturing region is Jiangsu with a share of 43.77%. The other two main regions for insecticide output are Shandong and Hubei.


The past decade has seen the largest structural optimisation in insecticides, compared with other pesticides. During the 12th Five-year Plan period (2010-2015), the state attached great importance to optimisation of insecticide product mix as well as development of new fungicides and herbicides to further meet demand from crop production.


One of the biggest problems of pesticides usage in China is the growing problem of pesticide residue and food safety, resulting of monotonous use in large amounts. China is using about 1.5 to 2.5 times more pesticides than developed countries, which raise these concerning issues. What’s more, the damage of inefficient and overused pesticides is causing losses worth around USD300 billion.


However, currently the efficiency and quality of insecticides in China is on the rise. One of the main regions with insecticides manufacturers is Hubei Province in China. The city Yichang in this province has announced several accomplishments in the year 2016. These comprise out of insecticides usage on crops, tea and vegetables reduced by 2%, utilization rate was 39%, green coverage rate of 30%, and the integrated control and prevention rate was 40%.


Rice Asiatic borers show high resistance

The rice Asiatic borer is one of the insects that is showing a surging resistance to common insecticides in China. Hence, experts predict a heavy strike for 2017 and even the beginning of 2018. According to market intelligence firm CCM, this trend reveals high opportunities for manufacturers of insecticides in China.


According to the Nanjing Agriculture University, during the past years, the rice Asiatic borer has developed resistance against a growing number of insecticides. Monitoring stations in important provinces started to detect populations highly resistant to methamidophos, monosultap and triazophos in 1990-2000. What's worse, the pests developed high resistance to monosultap, triazophos and fipronil later in 2000-2012, and to chlorantraniliprole as well as abamectin after 2017.


The reasons for the heavy occurrence in 2017 and 2018 can be found in several factors, including an expanded planting area of hybrid rice, continual rice planting, excessive fertilising, and improper insecticide application.


However, the occurring danger is offering huge opportunities for insecticides manufacturer and trader. Besides innovative products and technology, companies may also help farmers to use pesticides scientifically and make timely business adjustments based on field research. 

Environmental policies

After the occurrence of heavy pollution in many Chinese cities 2016, the government has increased measurements against heavy polluting manufacturers. New standards were arisen, which many producer failed to meet, leading to production suspension or even complete cut off. 

One new law with stricter regulations is the Atmospheric Pollution Prevention and Control Law of the People's Republic of China. The amended version is considered as the most stringent law for air pollution and control ever. Specifically, it requires the government to increase financial supports for air pollution and control and to include it in the national economic and social development planning. 

Furthermore, great revisions of the Water Pollution Prevention and Control Law were made compared with the 2008 version. The new law includes strengthened joint pollution control of rivers that flow through multiple provinces, including their catchment areas and tributaries as well as perfected water pollution supervision and control system by connecting pollutant discharge licensing with total discharge control and discharge standards.  

In addition to that, manufacturers in China can expect large-scale environmental inspections by the local authorities. These inspections already begun in the end of 2016 and will be continued in 2017. These inspections make sure of the implementation of environmental rectifications.  

Affected the strict regulations, most insecticide manufactures maintained low operating rates. Reduced output, coupled with increased raw material prices and environmental costs, pushed up insecticides prices. 

Tags: Insecticides, Rice Asiatic borer

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