AGROCHEMICALS MARKET ANALYSIS

Market Challenges And Opportunities

Global Agrochemicals Market Restraints:

• Stringent regulations governing the production and marketing of agrochemical products: The stringent regulations can have a negative impact on the global agrochemicals market in several ways. Regulations increase the cost of developing and producing agrochemicals, which leads to higher prices for consumers. Strict regulations can discourage innovation in the agrochemical industry, as companies may be hesitant to invest in research and development if they believe that their products will not be approved. For instance, in 2022, according to the data released by Heinrich-boll-stiftung European Union, amongst the top 10 most commonly used pesticides in Brazil, four have lost their authorization in the European Union.
• Counterbalance: Regulations laid out by the governments need to be a little flexible in allowing the market players to produce the agrochemicals at a more reasonable price.

Global Agrochemicals Market Opportunities:

• Rising production of sustainable agricultural products: Rising production of sustainable bio-based agricultural products is expected to drive the market growth over the forecast period. Due to the toxic ingredients contained in the chemicals agricultural products, their pollution levels are so high that these cause serious and, most of the time, fatal effects to the environment. Most biological products occur naturally, which reduces the cost of production, resulting in relatively cheaper prices compared to chemical pesticides, whose manufacturing cost is high. Records have shown that pests tend to become resistant to conventional pesticides, thus proving, that it is not a long-term solution, on the other hand, the use of organic pesticides and fertilizers offer long term solutions. For instance, in August 2022, Bayer AG (Germany-based Agricultural seeds and chemicals maker) launched a digital farming platform to help U.S. growers enact environmentally friendly practices and connect them with companies seeking sustainable products.

• Shrinking arable land area: The shrinking amount of arable land available for food production is a major factor driving growth in the global agrochemicals market. As the global population continues to grow, there is increasing pressure on the world's finite supply of cropland. According to UN 2021 data, the amount of arable land per person worldwide has declined steadily from 0.39 hectares in 1960 to only 0.22 hectares in 2020. This is expected to continue as the population grows to a projected 9.7 billion by 2050. As the imbalance between population and arable land persists, agrochemicals will continue to play a crucial role in closing crop yield gaps. Companies in the agrochemical sector are likely to see sustained growth and investment as the need for land-saving technologies and yield-enhancing inputs increases.