overview 2013

Industry Overview

Phillips McDougall – AgriService

Industry Overview – 2013 Market

The Overview Section of the AgriService presents our most recent analysis of the performance of the global crop protection and plant biotechnology markets in 2013. Included in this section is information on the recent performance and outlook for the global market, detailed analysis of crop, product and market sectors as well as key data regarding company performance. All sales information is presented at the distributor level, with currency conversions performed using average year exchange rates.

Phillips McDougall 1 May 2014

Industry Overview

Phillips McDougall Vineyard Business Centre For private circulation only. The information Copyright 2014 Saughland contained in this report constitutes our best judgement Pathhead at the time of publication, but is subject to change. Midlothian Phillips McDougall do not accept any liability for any EH37 5XP loss, damage or any other accident arising from the Tel: 44 (0)1875 320611 use of the information in this report. Fax: 44 (0)1875 320613

Industry Overview

Industry Overview

Contents Page No.

Industry Growth in 2013 4 Historical Industry Growth 7 Major Agrochemical Acquisitions and Mergers Since 2010 10 Crop Protection Industry Structure 2013 12 Key Product Acquisitions – 2010 to Present 14 Sales Growth of the Leading Companies – 2013 Leading Companies Ranked on Five Year Sales Growth

15 16

Leading Crop Protection and Seed & Trait Companies 17 Product Sector Analysis 18 GM Crops 20 Crop Sector Analysis Major Crop Global Planted Areas

23 24

Non Crop Agrochemical Market 25 Regional Market Analysis 26

NAFTA 28 Latin America 29 Asia 30 Europe 31 Middle East & Africa 32 World Market 33


Industry Overview

Industry Growth in 2013

The global market for conventional crop protection products (excluding sales of herbicide tolerant and insect resistant seed, as well as non-crop agrochemicals) is estimated to have increased by 9.4% to reach $54,208 million during 2013. This figure is based on the results of our own market analysis of the crop protection sector and takes into account the results of market research conducted in the majority of country markets. When the impact of trade-weighted inflation and currency factors are taken into account then the change in the overall market in real terms equated to an increase of 9.9% over 2012.

Conventional Crop Protection Market (Distributor Level) – 2008/2013

2008 2009 2010 2011 2012 2013

World Crop Protection Market ($m.)

43,187 40,147 41,291 46,539 49,549 54,208

Nominal change on previous year (%)

+20.3 -7.0 +2.8 +12.7 +6.5 +9.4

Real change on previous year (%)

+10.2 -1.5 +0.2 +7.1 +8.9 +9.9

The above table refers to the value of the market for chemical crop protection products, based on the sales of agrochemical products for crop use, including forestry and plantation crops. It does not, however, include agrochemical product sales in non-crop situations and markets which comprise the following sectors: turf, nursery and ornamentals, home & garden, PCO (pest control operators), rodenticides, wood preservatives, materials preservation, stored grains, public health, post-harvest protectants and industrial outlets. In 2013 the overall value of the agrochemical market for the use of products in the non-crop sector is estimated to have grown by 1.7% to $6,481 million.

Agrochemical Markets in 2013 (Distributor level - $m.)

Sales ($m.) 2013 2012 Change % 2013/2012

Conventional crop protection 54,208 49,549 +9.4

Non-crop agrochemical market 6,481 6,372 +1.7

Total 60,689 55,921 +8.5

Sales of conventional agrochemical products used in crop protection experienced growth of 9.4% to $54,208 million, whilst sales of herbicide tolerant (HT) and insect resistant (IR) seed into the crop protection sector increased by 8.7% in 2013 to reach $20,100 million.


Industry Overview

Growth within the crop protection sector is directly linked to support for agriculture, crop commodity prices and farm incomes, however the non-crop sector is influenced more by the economic position of the major markets, with consumer purchasing being a significant factor. Growth within the GM seed market is predominantly driven by the introduction of new technology with competition within the sector now intensifying as the number of available trait offerings continues to grow. Due to the positive growth of both the conventional crop protection market and the input trait sector, the value of the overall crop protection sector in 2013 is estimated to have increased by 9.2% to $74,308 million.

Crop Protection Market Value 2008-2013 (Ex manufacturer level- $m.)

Sales ($m.) 2008 2009 2010 2011 2012 2013

Conventional crop protection 43,187 40,147 41,291 46,539 49,549 54,208

GM Seed 9,150 10,570 12,870 15,685 18,495 20,100

Total 52,337 50,717 54,161 62,224 68,044 74,308

In the period following 1980 the agrochemical market had been experiencing relatively consistent value growth. However following the introduction and subsequent uptake of GM technology towards the latter half of the 1990’s, the agrochemical market entered into a corresponding phase of decline, beginning in 1998 and continuing on until 2006. Since 2006 value has again begun to increase significantly, albeit in a relatively volatile manner, primarily reflecting improved crop prices. One of the more prominent shifts in value that has occurred in recent years was during 2008 when the agrochemical market experienced its most significant increase since the mid-1970s to reach an all-time high. This spike was followed by a number of negative factors, the most notable of which was a major reduction in the price of glyphosate and food grain crop prices that helped contribute to a market decline in 2009. In 2010 the market returned to a situation of growth, albeit weak, followed by a much stronger situation in 2011 as the effects of greater stability in glyphosate prices, modest increases in overall agrochemical prices and volume growth driven by high crop prices were felt. This situation has continued on into 2012 and 2013, where strengthening glyphosate prices, global grain requirements and increasing import demands, particularly from developing economies, have played a pivotal role.


Industry Overview

Key Factors Impacting Global Crop Protection Market Performance in 2013:

Crop prices were strong for the first half of the year Continued growth in demand for crop commodities Biofuel demand maturing in USA Strengthening glyphosate prices Increased GM areas, however increased competition in trait supply Strong farm economies in the Americas, Europe and Asia

Key Regional Factors Affecting Crop Protection Market Performance During 2013:

Latin America o Brazilian market driven by rising crop prices and a weaker Real o 2012/13 drought in NE Brazil affecting sugarcane production o High insect pressure o 2012/13 planting in Argentina affected by wet weather o Continued uptake of GM throughout the region o High inflation in Argentina

Europe o Wheat prices favourable leading to an expansion in the planted

area, however overall cereal area was down o Expansion of the EU oilseed area o A prolonged winter resulted in the winter kill of crops in Russia o Wet summer in Northern Europe, much better in south and east

NAFTA o High corn and soybean prices in first half of year o Modest improvements in glyphosate prices o Dry, hot summer in the south and west o Wet weather delayed maize planting

Asia o Rice prices falling, but high by historical standards o Sustained demand from developing economies o Recovery from adverse weather in China, steady improvement

in Japan o Further uptake of GM crops in China and India o Lower palm oil price


Industry Overview

30,000

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$ m.

Historical Industry Growth

The following graph outlines the relative change in real terms in the value of the conventional crop protection market in the period from 1980 to 2013.

Conventional Crop Protection Market Value - Constant 2013 Dollars

As can be seen in the above graph, during the period 1980 to 1998 the value of the global crop protection market essentially grew year on year with the main exemptions being the downturns in both 1983 and 1991-1993. These reductions arose from changes in governmental support for agriculture in one of the main markets, namely the implementation of the Payment in Kind scheme in the USA (1983) and the introduction of set-aside in the EU following CAP reform (1991-1993). Following the initial introduction of GM crops in 1996, the market experienced a period of decline in real terms between 1998 and 2006. This reflected the increase in uptake of GM technology, particularly in North America and Latin America where a rapid switch to crop varieties containing traits conferring glyphosate tolerance and insect resistance led to declines in selective herbicide and insecticide applications in cotton, canola, soybean and maize. In addition to the impact of GM technology, crop prices over the same period were relatively flat, resulting in a depressing effect on the overall demand for agrochemical products. However in 2007 crop prices began to grow, and in 2008 spiked at a very high level, subsequently creating a major improvement in the agriculture economy. In 2009, crop prices fell back from their peak as the global economy experienced a severe down turn following the banking crisis in Europe and the Americas. This, coupled with a major reduction in glyphosate prices following increased supply from Chinese companies, resulted in the overall value of the global crop protection market declining.

US Payment in Kind Programme

EU CAP reform

Demand for crop commodities Biofuel demand

Latin American growth Improving glyphosate prices

GM crops


Industry Overview

During 2010 glyphosate prices remained low, and with improving crop prices the agrochemical market was more or less unchanged in real terms. In the early part of 2011 commodity prices increased, led by gains in wheat as a result of drought in Russia and flooding in Canada during 2010. Although glyphosate prices remained stable, significantly higher crop prices resulted in a buoyant agricultural economy and a significant rise in agrochemical demand in 2011. During 2012 the overall market experienced strong growth on the back of a continuation in the improvement of crop prices, and this trend continued into 2013 when, in real terms, the market experienced 9.9% growth over 2012. The table below outlines the real and nominal growth rates for the conventional crop protection market value by decade.

Growth of the Conventional Crop Protection Market

As can be seen on the graph on the following page, in the late 1990s and early 2000s the agrochemical market was largely cyclical in nature when measured in real terms. The market was affected by changes in agricultural policy and support, notably the US Farm Acts and various reforms of the EU Common Agricultural Policy with a sustained decline between 1990 and 1993 (Reform of the EU CAP) switching to positive growth through to 1995 as the market re-equilibrated. Much of the decline between 1996 and 2006 can be attributed to the impact of increasing GM adoption in the USA, Canada and Argentina, resulting in a redirection of value from the high value speciality herbicide market towards lower cost non-selective herbicides, primarily glyphosate. In addition, declining crop prices following the Uruguay round of GATT in 1995 and 1996 reduced food trade tariffs and had a negative impact on crop prices. However, crop prices started to improve in 2002/3 which put the market on a trend of recovery, peaking in 2004 with the Asian soybean rust outbreak in Brazil, although the following two years were depressed by economic weakness in developing markets.

In 2008 crop prices were boosted by financial investment; however this factor ended with a severe economic downturn in 2009 sending the market into decline in real terms. Since then sustained growth has arisen due to overall improvements in crop prices, along with other factors including variable weather patterns; rising crop imports, particularly from developing nations; a general improvement in the global economy; and, in more recent years, an improvement in glyphosate prices.

% Per Annum

Period Real terms Nominal

1970-1979 +7.6 +14.2

1980-1989 +2.5 +5.3

1990-1999 +0.1 +2.2

2000-2009 -0.8 +5.5

2010-2013 +8.6 +9.5


Industry Overview

-0.5

-3.0-1.6

-0.5

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4.3 3.7

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Real Growth of the Crop Protection Market 1990 to 2013

Real Growth (%)

As mentioned, amongst the largest key factors influencing the global agrochemical market has been increased crop commodity prices. The rise in crop prices has however taken place in a non-linear or volatile pattern reflecting the impact of weather on crop production in some years, increased import demand for grain and use of crops for biofuel, all of which have impacted grain supply and demand. This has led to grain and oilseed crop stocks remaining relatively stable against a background of higher production and increased demand. In turn this has led to spikes in the price of many crop commodities. Up until 2006, commodity prices had followed a relatively stable pattern, however during 2007 prices began to rise, with a spike in 2008 resulting in high market growth in that year. Although prices experienced declines in 2009, they remained at a level above that of the prevailing levels prior to 2007. In more recent years, between 2010 and through to 2013, prices again began to increase, resulting in higher volume demand for agrochemicals. In addition to crop commodity price, another major contributory factor has been variability in global glyphosate prices, beginning in 2009 when increased production and exports from China led to a global oversupply and subsequent rapid drop in value. Glyphosate prices remained low in 2010 and 2011, although recovery was seen in 2012 following the banning of the 10% solution in China, adding both volume and value to that market. This increase in demand in China coupled with production being limited by environmental issues in the country resulted in short supply and rising prices, however by the end of 2013 supply issues were resolved and prices started to weaken again. Other contributing factors that have influenced the global agrochemical market have included the strength of the farm economy in Latin America, particularly in Brazil and to a lesser extent Argentina, as well as the increasing use of crops for biofuel. GM technology continues to have a growing influence on the market, taking value out of the high value selective market into non-selective herbicides.


Industry Overview

Mergers and Acquisitions Since 2010

The following table lists the key company transactions in the industry since 2010.

Major Agrochemical Acquisitions and Mergers 2010 - Present

Acquirer Year Business Purchased or Merged

Agriphar 2010 Geopharm (Greece) and Terranalisi (Italy)

Arysta LifeScience 2010 Assets of South African agribusiness Afgri

ChemChina 2010 Announced intention to acquire majority holding in MAI

MAI 2010 Mexican company Ingenieria Industrial (known as BravoAg)

MAI 2010 51% holding in Korean company JK Inc.

Sumitomo Chemical 2010 20% stake in Nufarm

Sumitomo Chemical 2010 Indian agrochemical company New Chemi

United Phosphorus 2010 U.S.-based rice agrochemical supplier RiceCo

Willowood 2010 Indian agrochemical company Shreeji Pesticides

Arysta LifeScience 2011 Majority holding in Russian agrochemical distributor FES Group

Arysta LifeScience 2011 Majority holding in Indian company Devidayal Sales Limited

ChemChina 2011 60% stake in Makhteshim Agan

Coromandel 2011 Majority stake in Sabero Organics

Gowan 2011 Majority share in Chilean crop protection company Agro Technology

Idemitsu Kosan 2011 69.67% of the Japanese company SDS Biotech

Isagro 2011 100% stake in the Colombian distribution company Barpen

Sipcam 2011 Isagro Sipcam International‘s 75% holding in the Argentinean company AgroMax

Sumitomo Chemical 2011 Isagro's 50% stake in the distribution company Isagro Italia

Sumitomo Corporation 2011 90% stake in the Romanian company Alcedo SRL

Syngenta 2011 Agricultural distribution company Agrosan, based in Paraguay

United Phosphorus 2011 Isagro's 50% share in Sipcam Isagro Brazil

United Phosphorus 2011 51% stake in DVA Group's Brazilian company DVA Agro Brazil

Agro Kanesho 2012 Bayer’s Yuki Research Centre

Albaugh 2012 The Canadian distribution business AgWest Group

Arysta LifeScience 2012 Indian company Devidayal Sales Limited (DSL)

IQV 2012 25% stake in IQV Agro Spain held by Sumitomo Corporation

Monsanto 2012 Planting technology developer Precision Planting

SDS Biotech 2012 65% stake in the Indian company Sree Ramcides

United Phosphorus 2012 The Dutch agrochemical company Agrichem

Sinochem International 2012 Increased its holding in Yangnong Chemical to 40.53%


Industry Overview

Major Agrochemical Acquisitions and Mergers 2010 - Present (cont)

Acquirer Year Business Purchased or Merged

Agrium 2012 Acquired the majority of the agri-products division of Viterra

Stähler 2013 Cheminova divested the Swiss arm of its Stähler subsidiary to the local management

Nufarm 2013 Nufarm Americas acquired the agrochemical company Cleary Chemical Company, headquartered in Dayton New Jersey

Makhteshim 2013 Acquired a majority stake of the Chilean company ChileAgro

Makhteshim 2013 Acquired Magan Agrochemicals Serbia, with Magan becoming a wholly-owned subsidiary of MAI

Monsanto 2013 Acquired The Climate Corporation

Makhteshim 2013 Acquired the Slovakian-based crop protection distribution company Agrovita

Coromandel 2014 Coromandel International to merge its subsidiary Sabero Organics Gujarat Limited into Coromandel

UPL 2014 Increased its stake in UPL do Brasil from 53% to 73%

Sipcam Italia 2014 UPL divested its 50% stake in Sipcam UPL Brasil to Sipcam Italia

Bayer CropScience 2014 Argentinean seed treatment company Biagro Group

Arysta LifeScience 2014 French plant nutrition and plant protection company Goëmar

Platform Specialty Products 2014 Acquires Chemtura AgroSolutions for approximately $1 billion

The amount of M&A activity taking place in today’s agricultural sector has been slowing in recent years in part reflecting the highly consolidated nature of the current marketplace. Historically, two of the most significant events to have occurred in the modern agrochemical market were: the formation of Syngenta; and the acquisition of the Aventis Crop Protection business by Bayer, which resulted in the formation of the two industry leaders whose market share is today in excess of 15% each. Occupying the second tier is a group of companies with market shares between 5-15%. This group is comprised of the other main R&D driven multinational companies. With market shares between 1% and 5%, the third tier companies include the larger generic players, in particular the two leading generic companies, Nufarm and Adama (formerly Makhteshim Agan). More recently a number of companies have also joined this tier, namely Arysta, Cheminova, UPL (formerly United Phosphorus). In the case of the more recent entrants to this tier of the market, much of the growth that has arisen has been as a result of M&A activity undertaken by the companies, aimed at significantly enhancing product portfolios and distribution capability.


Industry Overview

Agrochemical Industry Structure – 2013*

Market Share

>15% 15% - 5% 5% - 1.0% 1.0% - 0.5% <0.5%

Europe Bayer BASF Cheminova Sipcam Oxon Isagro

Syngenta Helm Phyteurop

USA Dow FMC Chemtura Gowan Monsanto Amvac Albaugh DuPont

Japan

Sumitomo Chemical Ishihara Hokko Arysta Kumiai Agro Kanesho Nihon Nohyaku SDS Biotech Nippon Soda OAT Agrio Nissan Nippon Kayaku Mitsui Chemicals Kyoyu Agri

Other

Adama Sinochem Rotam Nufarm Rallis UPL Sinon Excel Wynka Red Sun Gharda

* Ranked by Headquarter Location and Global Market Share

Historical consolidation has also taken place within the Japanese agrochemicals sector, with companies such as Shionogi, Takeda, Mitsubishi Chemical and Ube no longer having independent agrochemical businesses, and Sankyo Agro now being part of Mitsui Chemicals. Even with this consolidation there are still a significant number of domestically based companies that are active in the Japanese agrochemical industry. In addition to Japan, several other Asian countries such as Korea, Taiwan, and India also have a significant locally based industry, however in value terms, companies in these countries are broadly much smaller than their Japanese counterparts. Despite there being a large number of agrochemical companies in China there are few with international operations; however consolidation within the Chinese market is accelerating. The largest companies in the Chinese market are listed above. The ranking outlined in the table above is comprised of the main manufacturing organisations and does not include those that are primarily focussed on product distribution. However within this latter category there are several companies with significant sales revenues, notably companies such as Agrium, Helena, Growmark, Wilbur-Ellis and Winfield in the USA and the leading Japanese trading companies, Mitsui & Co., Sumitomo Corporation and Marubeni Corporation.


Industry Overview

Over the last decade, several of the medium sized agrochemical companies have strengthened their position in the agrochemical industry through a series of strategic initiatives. While many of these moves have involved the acquisition of agrochemical companies, often with the aim of gaining additional distribution capability or regional marketing exposure, an increasing number of M&A transactions have been targeted at strengthening the respective product portfolios of the purchasing company through the acquisition of a particular agrochemical product or product range. Although product acquisition has always been a feature of the agrochemical industry, the last ten years has seen the overall level of this type of M&A activity increasing significantly. The key reasons as to why product acquisitions are more common than they were in the past include:

Consolidation amongst the industry majors has resulted in competition regulators requiring that product lines be divested in order to satisfy market share concerns. This is an increasingly important factor in what is now a relatively consolidated industry.

Several companies have pursued a strategy of streamlining their product portfolio and focussing only on those products considered to offer market potential. As a result products considered non-core to the on-going business have been divested.

The re-registration system operating in both the EU and the USA has led to some companies deciding that it is not viable to support a particular product during the regulatory review. This has resulted in a number of agrochemical companies deciding to divest certain products.

For several of the medium sized companies, notably Arysta, MAI, Nufarm, Cheminova and United Phosphorus, product and company acquisitions have become a key feature of their strategy to advance not only their relative position within the agrochemical industry, but also to provide the company with a proprietary product range. The table on the following page outlines the key product acquisitions within the global agrochemical market since 2010.


Industry Overview

Key Product Acquisitions in the Agrochemical Industry - 2010 to present

Acquirer Year Product Acquired

Amvac 2010 Cotton defoliant Def (tribufos) from Bayer CropScience

Amvac 2010 Ethoprophos (Mocap) and fenamiphos (Nemacur) from Bayer CropScience

Amvac 2010 Global product rights to the insecticide tebupirimifos from Bayer CropScience

Bayer CropScience 2010 Biofungicide Shemer from AgroGreen

Bayer CropScience 2010 Varroa mite (varroa destructor) control product from Exosect

Cheminova 2010 Rogor (dimethoate) business from Isagro

FMC 2010 Herbicide fluthiacet-methyl

Gowan 2010 Product rights for the insecticide / fungicide M-Pede and the herbicide Scythe from Dow AgroSciences

MAI 2010 Plant growth regulator Talent (Carvone) from Formuchem

Nippon Soda 2010 Tebufenozide from Dow

Nissan Chemical 2010 Thifluzamide from Dow

Plant Health Care 2010 Intellectual property rights to Myconate from Bayer CropScience

United Phosphorus 2010 Global non-mixture mancozeb assets from DuPont

Amvac 2011 Remaining global rights to the cotton defoliant tribufos from Bayer

FMC 2011 Fungicides Rovral (iprodione) and Sportak (prochloraz) from Bayer

Insecticides India 2011 Monocil (monocrotophos) from Nocil

MAI 2011 DuPont’s global non-mixture diuron business

Otsuka AgriTechno 2011 Rice herbicide benfuresate from Bayer

Sumitomo Chemical 2011 Ethaboxam fungicide business from LG Life Sciences

Crystal Crop Protection 2012 Insecticide Luphos-36 (monocrotophos) from Cheminova India

Indofil 2012 Dow's European Dithane (mancozeb) business

Otsuka AgriTechno 2012 Rice herbicide benzofenap from Bayer

Tessenderlo Kerley 2012 Crop protection assets of carbaryl from Bayer

Belchim 2013 Rights and assets related to valifenalate from ISEM

Nihon Nohyaku 2013 Rights and assets related to orthosulfamuron from ISEM

Lallemand Plant Care 2014 The intellectual property rights and assets related to BrettYoung's biologicals product portfolio

Sumitomo Corporation 2014 Acquired the strobilurin fungicide metominostrobin from Bayer CropScience


Industry Overview

Sales Growth of the Leading Agrochemical Companies - 2013

The following table details the ranking of the leading agrochemical companies based on their sales of conventional agrochemical products, excluding seed and trait revenues, together with their sales growth in 2013.

Agrochemical Company Sales (excluding seed & trait revenues)

Sales ($m.) 2013 2012 % Change 2013/2012

Syngenta 11,413 10,785 +5.8

Bayer CropScience 10,418 9,539 +9.2

BASF 6,942 6,014 +15.4

Dow AgroSciences 5,523 5,022 +10.0

Monsanto* 4,804 3,994 +20.3

DuPont 3,558 3,173 +12.1

Adama 2,876 2,649 +8.6

Nufarm** 2,297 2,246 +2.3

FMC 2,146 1,764 +21.7

Sumitomo Chemical*** 2,020 1,905 +6.0

UPL 1,607 1,448 +11.0

Arysta 1,501 1,527 -1.7

Cheminova 1,101 1,027 +7.2

Sipcam 514 459 +12.0

ISK*** 502 541 -7.2

* Year ending 31 November 2013 ** Year ending 31 January 2014 *** Year ending 31 March 2014

Syngenta has been the leading company in the agrochemical industry since 2008, with the company maintaining this position each year to date. In terms of US dollar sales, the majority of the above companies achieved positive sales growth during 2013, with the highest rise in sales within this group of companies achieved by FMC (now the fastest growing agrochemical company for each of the past two years), whilst double digit growth was also achieved by Monsanto, BASF, DuPont, Sipcam, UPL and Dow. During 2013 the results of Japanese and Indian companies were negatively impacted by the strengthening of the US dollar against local currencies, such that positive sales results in local terms were translated to declines in US dollar value.


Industry Overview

Leading Companies Ranked on Five Years Sales Growth

The following table ranks the leading twenty companies on the basis of their agrochemical sales growth (excluding any contribution from agricultural biotechnology) over the last five years. Leading Companies – Agrochemical Sales Growth 2008/2013

Company Sales ($m.) % p.a. Sales

2013 2008 Growth 2008/2013

FMC 2,146 1,059 +15.2

UPL 1,607 937 +11.4

Sumitomo Chemical*** 2,020 1,378 +7.9

DuPont 3,558 2,550 +6.9

BASF 6,942 4,991 +6.8

Dow AgroSciences 5,523 4,139 +5.9

Arysta 1,501 1,170 +5.1

Syngenta 11,413 9,231 +4.3

Adama 2,876 2,335 +4.3

Bayer CropScience 10,418 8,682 +3.7

Sipcam 514 451 +2.6

Cheminova 1,101 990 +2.1

ISK*** 502 476 +1.1

Nufarm** 2,297 2,287 +0.1

Monsanto* 4,804 5,333 -2.1


Within the above group of companies, the fastest growing on the basis of sales growth over the last five-year period are FMC, UPL, Sumitomo Chemical, DuPont, BASF, Dow and Arysta. All of these companies have achieved a compound annual growth rate (CAGR) in excess of 5% in the last five years. Clearly not all of this sales growth has come from organic growth, particularly as a number of these companies, notably UPL and Adama, have been involved in a significant level of M&A activity. In addition a number of companies will have benefited from currency exchange effects.


Industry Overview

Leading Crop Protection and Seed & Trait Companies

As discussed previously, the introduction of GM crops modified to possess herbicide tolerance (HT) and insect resistance (IR) has had a significant impact on the makeup of the crop protection sector. Several agrochemical companies have established sizeable operations based on this new technology. The following table ranks the leading agrochemical companies on the basis of their overall sales in crop protection and seeds & traits. Leading Crop Protection and Seed & Trait Companies in 2013

Company Sales ($m.)

Agrochemical Seeds & Traits Total

Monsanto* 4,804 10,261 15,065

Syngenta 11,413 3,204 14,617

DuPont 3,558 8,181 11,739

Bayer 10,418 1,293 11,711

Dow 5,523 1,614 7,137

BASF 6,942 0 6,942

Adama 2,876 0 2,876

Nufarm** 2,297 98 2,395

FMC 2,146 0 2,146

Sumitomo Chemical*** 2,020 0 2,020

UPL 1,607 0 1,607

Arysta 1,501 0 1,501

Cheminova 1,101 0 1,101

Sipcam 514 0 514

ISK*** 502 0 502


In addition to their involvement in agrochemicals, five of the leading companies have a direct presence in the seeds and traits sector, with the most significant players being Syngenta, Monsanto and DuPont. As well as the seed and trait operations listed above, BASF has a sizeable stake in the plant biotechnology sector through BASF Plant Science, which is predominantly involved in trait development.


Industry Overview

02,0004,0006,0008,000

10,00012,00014,00016,00018,00020,00022,00024,000

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Herbicides

Others

GM Seed

Fungicides

Insecticides

$m

Product Sector Analysis

During 2013, the market for conventional crop protection products was divided by sector as shown below. Conventional Crop Protection Market 2013

In addition to the above, a further $20,100 million is attributable to the sale of seed of crops genetically manipulated to express input traits, herbicide tolerance or insect resistance, the uptake of which has a direct impact on the market for conventional agrochemical products, as can be seen clearly in the graph below. Crop Protection Product Sector Performance Since 1990

In 2013, the value of the herbicides sector rose by 9.6% benefitting from improved glyphosate pricing as well as volume demand in developing markets. The value of insecticide sales improved by 9.1%, benefiting from strong acceptance for new products, notably chlorantraniliprole. For fungicides, sales increased by 8.8% with a strong Asian soybean rust market in Brazil offsetting the negative effects of unfavourable weather conditions in the USA and Europe. Sales of agrochemicals used in non-crop situations rose by 1.7% to $6,481 million aided by an increase in glyphosate prices in non-crop situations. The GM seed market rose by 8.7% to $20,100 million, driven by value enhancement due to the increased adoption of stacked trait varieties as well as continued expansion in Latin America and Asia.

Total = $54,208 million

Others 3.0%

Insecticides 27.5%

Fungicides 25.8% Herbicides 43.7%


Industry Overview

Growth of the Global Crop Protection Market by Sector

Herbicides Insecticides Fungicides Others Total CCP GM Seed

2013/2012 (%) +9.6 +9.1 +8.8 +14.6 +9.4 +8.7 2013/2008 (% p.a.) +3.9 +5.7 +5.1 +3.2 +4.7 +17.0 2013/2003 (% p.a.) +5.7 +7.5 +8.7 +5.1 +6.8 +18.4 Note: CCP = Conventional Crop Protection

Over the last ten years, market growth has been led by the fungicides sector, although in the last five years insecticides have recorded stronger growth. Generally the key factors affecting the performance of the fungicide sector are weather related, affecting disease pressure and hence product demand. During 2013, fungicide sales rose by 8.8% to $14,008 million, with positive performances across all major crops, led by maize, cereals, soybean and fruit & vegetables. The cereal area in Europe increased, however the fungicide sector was affected by a late end to the winter and another wet summer in northern Europe, although the South and East were more favourable. Sustained disease pressure resulted in an improved soybean fungicide market in Brazil although Argentina suffered a decline. The prospect of falling maize and soybean prices held back growth in the US central corn belt although following a slow start to the season growing conditions were good. At the product level, the sector continues to benefit from growth of the seed treatment sector, whilst resistance issues continue to benefit products offering new modes of action. In 2013 further growth for the new phenyl pyrazole succinate dehydrogenase inhibiting products drove this strong performance, with further introductions from this class likely to result in further expansion of the fungicide sector in the immediate future. During 2013, the greatest market improvement was recorded by herbicides, with sales rising by 9.6% to $23,685 million, equating to a 43.7% market share. A significant contribution to this was improvement in glyphosate markets. All major crop sectors except rice and sugarbeet recorded an increase in herbicide sales in dollar terms, led by soybean, sugarcane, sunflower, rape/canola and fruit & vegetable crops, with glyphosate resistant weeds resulting in an improvement for selective herbicides in the USA. Insecticide sales in 2013 rose by 9.1% to stand at $14,885 million, equivalent to 27.5% of the global crop protection market, and by 5.7% p.a. over the last five years. Growth was recorded across most major crop sectors, but particularly on soybean and maize, the market in Brazil benefitting from a severe Helicoverpa problem. The insecticide market also continued to benefit from significant growth for recent introductions, notably chlorantraniliprole and spirotetramat, but also flubendiamide and metaflumizone. Over the next five years it is expected that fungicides will continue to lead market growth, the products being key to delivering the crop yield and quality improvement that the market is demanding. In the herbicide sector a more stable pricing position in the glyphosate market is expected to result in a steady market improvement overall, with volume growth led by increasing usage in developing markets. Lower growth is anticipated in the insecticide sector as the Helicoverpa issue in Brazil comes under control, and a further negative impact is expected from GM seeds. In addition, less growth is expected for insecticides than fungicides and herbicides in developing markets.


Industry Overview

GM Crops

The following table outlines the historical development of GM crop areas over the last ten years. Significantly more detail regarding the GM sector and the seeds industry as a whole, including the companies, is available in the Phillips McDougall Seed Service. GM Crop Areas 2003 – 2013

Acres million 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Herbicide Tolerant

LL Canola 2.7 4.1 4.9 6.0 5.8 7.5 7.1 7.7 8.7 10.8 10.3

LL Maize 1.4 1.5 0.5 0.5 0.6 0.5 0.5 0.5 0.5 0.5 0.5

LL Cotton 0.0 0.0 0.3 0.4 0.3 0.3 0.1 0.1 0.4 0.7 0.2

LL Soybean 0.0 0.0 0.0 0.0 0.0 0.0 0.4 0.6 0.8 1 0.5

RR Canola 6.2 6.3 6.8 5.6 7.4 7.8 8.3 9.2 9.6 10.4 9.5

RR Cotton 4.7 3.5 2.9 3.6 2.7 2.2 1.6 3.1 4.0 1.4 1.1

RR Maize 7.2 8.5 11.3 12.4 17.4 16.7 15.6 17 16.4 15.5 9.7

RR Soybean 98.1 108.9 119.1 133.9 133.7 147.5 160.2 172 183.1 191.6 204.7

RR Sugarbeet 0.0 0.0 0.0 0.0 0.0 0.545 0.8 1.1 1.1 1.2 1.2

Other HT Crops 0.3 0.2 0.0 0.0 0.0 1.0 0.9 1.0 0.5 1.0 1.0

HT Total 120.6 133.0 145.8 162.3 167.9 184.0 195.5 212.3 225.1 234.1 238.7

Insect Resistant Crops

B.t. Cotton 5.5 8.7 11.5 16.8 23.2 27.2 31.0 43.0 44.4 44.0 44.8

B.t. Maize 21.1 28.6 26.1 22.1 21.6 21.4 15.3 12.7 16.3 29.6 35.4

CRW Maize 0.4 1.1 0.9 1.2 0.4 0.0 0.0 0.0 0.0 0.0 0.0

B.t Rice 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

IR Total 27.0 38.4 38.5 40.1 45.1 48.6 46.3 55.7 60.7 73.5 80.2

Stacked Gene Crops

Stacked Cotton 5.5 7.0 8.7 9.2 7.0 6.3 6.4 8.1 10.8 12.9 12.3

Stacked Maize 8.9 12.7 19.2 27.4 48.6 57.5 63.4 67.0 78.9 87.1 95.8

Stacked Soybean 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Stack Total 14.4 19.7 27.9 36.6 55.6 63.8 69.8 75.1 89.7 100.0 108.1

Total 162.0 191.1 212.2 239.0 268.6 296.4 311.6 343.1 375.5 407.6 427.0

Note: LL=Liberty Link; RR= Roundup Ready; CRW=Corn rootworm resistant

In 2013 the overall planted area of herbicide tolerant and insect resistant crops increased by 4.8% to reach 427.0 million acres (172.8 million hectares). As a result of this increase in area, the overall value of the agricultural biotechnology sector, based on the sale of seed of genetically manipulated HT and IR crop varieties, increased by 8.7% to reach $20,100 m. in 2013. The share of the total GM cultivated area planted with stacked gene varieties of cotton and maize in 2013 was 25.3%, while herbicide tolerant trait varieties of canola, soybean, sugarbeet, maize and cotton accounted for 55.9% with the remaining 18.8% share attributable to insect resistant varieties of cotton and maize.


Industry Overview

Value of GM Seed Market by Crop 2013

Maize is the most important sector of the GM seed market ahead of soybean, reflecting both the value of the overall maize seed market and the continued trend towards cultivation of premium priced stacked gene varieties of maize in the USA. As a result of this market advance, the proportion of US maize planted with transgenic herbicide tolerant and insect resistant crop varieties in 2013 has reached around 92.1% of the total area. Overall, however, the highest level of market penetration by GM crop varieties has been with glyphosate tolerant soybean in Argentina where over 98% of the crop in 2013 was planted with these varieties. In Brazil, the share attributable to Roundup Ready soybeans has been steadily increasing since their first adoption in 2004/5, and during 2013 the overall proportion of soybean planted with Roundup Ready varieties reached 86.6% of the total soybean area. The following chart outlines the planted area of transgenic crop varieties (excluding non-transgenic varieties such as Clearfield) split by geographic region in 2013. Area of GM Seed by Region 2013

At the country level, 40.8% of the global area planted with GM HT and IR crop varieties is in the USA, with a further 40.6% in Latin America, 5.9% in Canada and 12.7% in the rest of the world, led by cotton in India and China. Over the last few years the relative share of the global GM crop planted area attributable to the USA has been slowly declining from an estimated 59.3% in 2005 to last year’s figure of 40.8%, primarily due to increased adoption of GM crop technology outside the USA. In addition the range of crops utilising GM technology has increased recently from maize, soybean, canola and cotton to include sugarbeet and alfalfa with further GM crop species scheduled be commercialised over the next ten years.


Maize 57.1% Canola 3.6%

Cotton 8.2% Others 0.4%

Soybean 30.7%

Rest of Latin America 3.3%

Argentina 15.1%

Canada 5.9% Brazil 22.2%

USA 40.8% Asia

11.2% Rest 1.5%

Total Planted Area = 427.0 million acres


Industry Overview

GM Seed Market by Trait 2013

Over the next few years, the GM crop sector is also expected to continue to move increasingly toward multiple trait stacked gene varieties, with reduced refuge and refuge in the bag (RIB) products becoming dominant in the maize sector. Further multiple trait crop varieties are also expected to be developed over the next few years incorporating not only newly developed input traits but also output traits such as drought tolerance. In addition to stacked trait crops, new herbicide tolerant traits, including 2,4-D and dicamba tolerance, are likely to be commercialised in the next few years. Roundup Ready alfalfa and sugarbeet has also been introduced and there is the prospect of the introduction of B.t rice in India and China within the next five-year period. Market Forecast for Crop Protection Market to 2018 ($m)

Herbicides Insecticides Fungicides Others Conventional Market

GM Seed

TOTAL

2013 23,685 14,885 14,008 1,630 54,208 20,100 74,308

2018 26,650 16,665 16,387 1,804 61,506 22,928 84,434

Growth % pa +2.4 +2.3 +3.2 +2.0 +2.6 +2.7 +2.6

Conventional Market 2018F GM Seed Market 2018F

Key Points

GM sector focussed on maize, soybean, cotton and canola RR sugarbeet and alfalfa recently introduced Market led by the Americas, but geographic exposure increasing Introduction of insect resistant soybean in Latin America Introduction of 2,4-D and dicamba tolerant traits in next few years Adoption of RIB and reduced refuge technology Stacked gene varieties driving grower acceptance and value increase

Total = $22,928 million Total = $61,506 million

Maize 57.8%

Soybean 29.3%

Rape 3.9% Cotton 8.0%

Others 1.0%

Herbicides 43.3%

Others 2.9% Fungicides

26.7%

Insecticides 27.1%

Herbicide Tolerant 38.4%

Stacked Gene 47.2%

Insect Resistant 14.4%



Industry Overview

Crop Sector Analysis

During 2013, the market for conventional crop protection products was divided by crop sector as shown below. Conventional Crop Protection Market Divided by Crop 2013

The table below shows the major crop sectors that recorded the greatest growth in 2013 against the previous year, as well as those that recorded the weakest performances. The table is led by growth in the value of soybean insecticides, with sugarbeet insecticides showing the sharpest decline. Crop Sectors by Growth Performance 2013

Rank Crop Sector Sales 2012 ($m)

Sales 2013 ($m)

Growth 2013/2012

(%)

Strongest Market Sectors 1 Soybean Insecticides 2559 1785 43.4 2 Soybean Herbicides 3185 2580 23.4 3 Rape Fungicides 588 482 22.0 4 Sugarcane Herbicides 1116 942 18.5 5 Sunflower Herbicides 594 503 18.1 6 Rape Herbicides 1098 942 16.6 7 Vine Herbicides 294 254 15.7 8 Pome fruit Fungicides 628 554 13.4 9 Maize Fungicides 640 568 12.7 10 Pome fruit Herbicides 205 182 12.6 Weakest Market Sectors 1 Rice Fungicides 1157 1122 3.1 2 Cereals Herbicides 4639 4537 2.2 3 Cotton Herbicides 698 696 0.3 4 Rape GM Seed 714 719 -0.7 5 Rice Herbicides 2165 2202 -1.7 6 Rice Insecticides 1782 1821 -2.1 7 Cotton GM Seed 1648 1751 -5.9 8 Sugarbeet Herbicides 583 626 -6.9 9 Sugarbeet Fungicides 73 87 -16.1 10 Sugarbeet Insecticides 68 87 -21.8

Fruit and Vegetables 24.5%


Cereals 16.7% Other crops 9.0%

Soybean 14.0%

Maize 11.6%

Rice 9.6% Rape 3.9% Cotton 5.1%

Sugarbeet 1.3% Sugarcane 3.0%

Sunflower 1.3%


Industry Overview

Major Crop Global Planted Areas

Wheat Maize Rice Soybean Cotton Rape

Planted Area 2013 (ha. m.) 219.6 176.7 160.1 111.9 33.0 35.6

Growth 2013/2012 (%) +1.8 +0.2 +1.7 +2.6 -3.8 -1.6

Growth 2013/2008 (% p.a.) -0.5 +2.2 +0.3 +3.0 +1.5 +2.7

During 2013 crop planting benefitted from sustained crop commodity prices, aided by increased global demand for grain and oilseed crops. In the EU, the cereal planted area was essentially static but the overall area of oilseed crops increased. Grain production in the EU was however impacted by another wet summer in Northern Europe. The Russian wheat sector was affected by a cold winter but benefitted from much better summer growing conditions. In Latin America in the 2012/13 season both the maize and soybean planted areas in Argentina and Brazil increased aided by high commodity prices. Crop production benefitted from better weather conditions, although planting in Argentina was affected by wet weather and dryness again affected the Brazilian sugarcane crop. In the USA, both the maize and soybean areas declined moderately as the planting season was delayed, however crop development progressed well leading to a record harvest. Against a background of lower prices, the cotton planted area in the USA again declined. In Canada the spring planting season was similarly affected, however again good growing conditions led to record harvests. Much of southern Asia was affected by a very heavy monsoon season, notably in Thailand, Western China and in India; however Australia suffered a significant drought. Toward the year end the rice price weakened, but this was predominantly due to de-stocking in Thailand. Forecast Value Growth by Crop Sector – 2013 to 2018 (% p.a.)

Herbicides Insecticides Fungicides Others Conventional Market

GM Seed

Total

Cereals +2.5 +3.8 +2.5 +1.7 +2.6 +2.6 Maize +1.6 +2.0 +2.7 +2.7 +1.8 +2.9 +2.5 Rice +3.0 +3.7 +3.5 +3.6 +3.3 +3.9 Soybean +0.8 +0.2 +2.3 +4.0 +1.0 +1.7 +1.3 Rape +3.0 +2.3 +2.2 +3.7 +2.6 +4.4 +3.1 Sunflower +6.2 +5.2 +5.5 0.0 +6.1 +6.1 Cotton +1.2 +1.0 +4.8 +1.2 +1.3 +2.1 +1.6 Sugarbeet +4.1 +3.0 +2.8 0.0 +3.9 +0.5 +3.6 Sugarcane +3.9 +4.0 +8.4 +2.1 +3.9 +3.9 Fruit and Veg. +3.0 +2.5 +3.5 +2.2 +3.0 +3.0 Other crops +2.3 +3.5 +5.1 +2.5 +3.3 +3.3 Total +2.4 +2.3 +3.2 +2.0 +2.6 +2.7 +2.6

The key factors taken into account are the impact of GM crop adoption, growth in developing markets due to economic and population growth as well as dietary change, expected movements in crop prices and legislation affecting agriculture.


Industry Overview

Non Crop Agrochemical Market

In addition to a market of $54,208 million for crop protection products, a further $6,481 million in sales of agrochemicals is made in non-crop markets. These market sectors are estimated to have recorded growth of 1.7% in 2013 in comparison with the previous year. The non-crop market is not subject to the same factors that affect agriculture and has grown at a rate of 2.8% p.a. over the last five years. The non-crop sector is driven more by economic development, product price and volume, with technical advance having less impact than in crop sectors, although newer chemistry has made inroads into the termiticides and turf sectors. During 2013 the non-crop market gained from a generally improving economic environment and greater demand in developing markets notably in Latin America and Asia. In addition to this, prices, particularly for glyphosate, were improved. Turnover in Japan was deflated on currency translation, whilst growth was driven by the advanced developing countries, Brazil, India, China and Russia. Non-Crop Agrochemical Market 2013 by Region

Non-Crop Agrochemical Market 2013 by Sector

Middle East / Africa 5.8% NAFTA 33.2%

Latin America 7.8%

Europe 15.3%

Asia 37.9%


Fungicides 25.7%

Insecticides 37.3%

Others 1.8% Herbicides

35.2%



Industry Overview

02,0004,0006,0008,000

10,00012,00014,00016,000

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

$m

NAFTA

EuropeAsia

Latin America

Africa / Middle East

Regional Market Analysis

The market for conventional crop protection products in 2013 was divided by region as shown below.

In 2013 market conditions were again better than in the previous year as crop prices were sustained and weather conditions generally improved, although currency exchange had an impact on many Asian markets. In dollar terms, growth of the crop protection market was led by Latin America (+22.3%) with strong gains in Brazil, Uruguay and Argentina, followed by Europe (+10.0%). The 2012/13 Latin America market benefitted from sustained high crop prices, although wet weather at planting and economic factors in Argentina held back overall growth. Brazil was more positive except for a dry late summer. In Europe, the market suffered from a late start to the season and a wet summer in Northern Europe, but summer conditions in East and South Europe were more positive. Eastern Europe again suffered from a long cold winter however summer conditions were far more positive, resulting in improved crop production and agrochemical market development. Despite a delayed maize and soybean planting season, the NAFTA market rose by 8.4%, with good summer growing conditions resulting in high yields in Canada and the US Midwest, although the southwest and Mexico suffered from dryness. The Asian market fell by 1.8% in dollar terms, although all major countries except Australia and South Korea registered growth in local currency terms. However flooding resulting from a strong monsoon across south Asia held back market performance. Rising glyphosate prices were a positive, although lower oil palm prices and rising labour costs were an issue. Regional Market Performance Since 1990


Asia 26.6%

Middle East / Africa 3.9%

Europe 25.1%

NAFTA 18.5%

Latin America 25.9%


Industry Overview

Conventional Agrochemical Market Performance 2008 – 2013 – 2018F

Rank Country Sales Sales Sales Growth Growth Forecast Growth

2008 2012 2013 2013/12 2013/08 2018 2018/13

($m) ($m) ($m) (%) (% p.a.) (2013 $m) (% p.a.)

1 Brazil 5,932 7,956 10,013 +25.9 +11.0 11,078 +2.0 2 USA 6,585 7,035 7,387 +5.0 +2.3 7,581 +0.5 3 China 3,191 4,360 4,831 +10.8 +8.6 6,140 +4.9 4 Japan 3,177 4,067 3,389 -16.7 +1.3 3,534 +0.8 5 France 3,224 2,651 2,857 +7.8 -2.4 2,934 +0.5 6 Germany 2,016 1,928 2,121 +10.0 +1.0 2,191 +0.7 7 Canada 1,326 1,623 1,967 +21.2 +8.2 2,066 +1.0 8 Argentina 1,026 1,450 1,747 +20.5 +11.2 1,974 +2.5 9 India 1,437 1,682 1,732 +3.0 +3.8 2,105 +4.0 10 Italy 1,172 1,213 1,303 +7.4 +2.1 1,377 +1.1 11 Australia 1,143 1,350 1,107 -18.0 -0.6 1,556 +7.0 12 Spain 937 838 996 +18.9 +1.2 1,049 +1.0 13 Russia 508 782 900 +15.1 +12.1 1,332 +8.2 14 UK 735 783 744 -5.0 +0.2 807 +1.6 15 Ukraine 335 614 742 +20.8 +17.2 1,075 +7.7 16 Mexico 414 580 657 +13.3 +9.7 774 +3.3 17 Poland 601 519 599 +15.4 -0.1 725 +3.9 18 Indonesia 410 564 572 +1.4 +6.9 705 +4.3 19 Korea 551 546 550 +0.7 0.0 569 +0.7 20 Thailand 460 440 467 +6.1 +0.3 593 +4.9

WORLD 43,187 49,549 54,208 +9.4 +4.7 61,506 +2.6

During 2013, all of the top twenty crop protection country markets recorded growth in local currency terms, except for the UK, South Korea and Australia. The most significant gains in local currency terms were in Argentina and Brazil, followed by Canada, Ukraine, Russia, Spain and India. Generally weaker performances were recorded by the more mature markets, notably Japan and Korea. In dollar terms results were less positive, with 3 of the top 20 countries recording crop protection market declines following currency translation. Global Market by Region and Product Sector 2013 ($m)

Herbicides Insecticides Fungicides Others Total CCP GM Seed TOTAL

NAFTA 5,492 2,169 2,020 330 10,011 13,593 23,604 Latin America 5,380 4,817 3,419 410 14,026 5,208 19,234 Europe 6,315 1,837 5,011 471 13,634 18 13,652 Asia 5,582 5,264 3,200 386 14,432 1,032 15,464 MEA 916 798 358 33 2,105 249 2,354 Total 23,685 14,885 14,008 1,630 54,208 20,100 74,308


Industry Overview

Mexico $657 m.

0

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12,000

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$m

Herbicides 54.8%

Insecticides 21.7%

Fungicides 20.2%

Others 3.3%

NAFTA

Crop Protection Non-Crop GM Seed

2013 ($m) 10,011 2,150 13,593

Growth 2013/2012 (%) +8.4 +2.0 +4.2

Forecast 2018 ($m) 10,421 2,495 14,602

Forecast 2018/2013 (% p.a.) +0.8 +3.0 +1.4

Crop Protection

Key Points US maize, soybean and cotton area declined Good growing conditions resulted in a record US maize harvest Canada also enjoyed good growing conditions GM share of key crop areas high and effectively at maturity Maize usage for ethanol reached record levels at the end of 2013 Crop commodity prices sustained at a high level Improvement in glyphosate prices Southwestern USA and Mexico suffered from poor water availability

Key Crops Market Share

Maize 24.1%

Fruit & Vegetables 21.3%

Cereals 16.4%

Soybean 13.1%

Rape 5.7% USA $7,387 m.

Canada $1,967 m.


Industry Overview

Chile $241 m.

Brazil $10,013 m.

Paraguay $296 m.

Colombia $366 m.

Argentina $1,747 m.

0

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2003

2004

2005

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2007

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2011

2012

2013

$mHerbicides 38.4%

Insecticides 34.3%

Fungicides 24.4%

Others 2.9%

Uruguay $247 m.

Latin America


2013 ($m) 14,026 504 5,208

Growth 2013/2012 (%) +22.3 +3.5 +25.8

Forecast 2018 ($m) 15,744 705 6,200

Forecast 2018/2013 (% p.a.) +2.3 +6.9 +3.5

Crop Protection

Key Points

High commodity prices prevailing during season Brazilian Real weakened against US $ Dry weather affected Brazilian sugarcane production Rising glyphosate prices GM maize and soybean areas increased especially in Brazil Maize and soybean area in Brazil and Argentina increased High interest rates in Brazil and inflation in Argentina


Soybean 41.2%


Maize 10.3%

Sugarcane 9.3%

Cotton 6.6%

Cereals 4.0%

Rice 3.2%


Industry Overview

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

$m

Insecticides 36.5%

Fungicides 22.1%

Herbicides 38.7%

Others 2.7%



Rice 30.3%

Cereals 12.3%

Cotton 5.9%

Maize 4.4%

Soybean 2.4%

Australia $1,107 m.

India $1,732 m.

South Korea $550 m.

China $4,831 m. Japan

$3,389 m.

Thailand $467 m.

Asia


2013 ($m) 14,432 2,459 1,032

Growth 2013/2012 (%) -1.8 -1.6 -2.1

Forecast 2018 ($m) 17,336 2,801 1,790

Forecast 2018/2013 (% p.a.) +3.7 +2.6 +11.6

Crop Protection

Key Points

Drought depresses the Australian market Heavy monsoon results in flooding in many South Asian countries Increase in Chinese grain imports Price improvement benefits the Chinese market Flooding in parts of India depresses market potential Steady growth in the Japanese market Declining palm oil price but rising glyphosate prices affect the plantation

crop sector


Industry Overview

Poland $599 m.

UK $744 m.

Germany $2,121 m.

France $2,857 m. Spain

$996 m. Italy $1,303 m.

Ukraine $742 m.

Russia $900 m.

0

2,000

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14,000

16,000

2003

2004

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2012

2013

$m

Insecticides 13.6%

Herbicides 46.3%

Others 3.5%Fungicides

36.6%

Europe


2013 ($m) 13,634 992 18

Growth 2013/2012 (%) +10.0 +4.3 +80.0

Forecast 2018 ($m) 15,526 1,137 21

Forecast 2018/2013 (% p.a.) +2.6 +2.8 +3.1

Crop Protection

Key Points

Limited Increase in cereal areas, more significant for oilseed rape Wheat price sustained during the year Cold winter but better summer in Eastern Europe Late start to spring in the EU, however:-

Wet summer and autumn in the north Better conditions in the south

Improving economic environment in Eastern Europe 2013 autumn planting held back in Northern Europe due to wet fields


Cereals 34.6%

Maize 11.9%

Rape 9.0%

Vine 8.6%

Potato 4.6%

Pome fruit 4.5%

Sugarbeet 4.2%


Industry Overview

0

500

1,000

1,500

2,000

2,500

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

$m

Herbicides 43.5%

Insecticides 37.9%

Fungicides 17.0%

Others 1.6%

Middle East & Africa


2013 ($m) 2,105 376 249

Growth 2013/2012 (%) +20.1 +14.6 +3.8

Forecast 2018 ($m) 2,479 448 315

Forecast 2018/2013 (% p.a.) +3.3 +3.6 +4.8

Crop Protection

Key Points

Political upheaval disrupts trade in Kenya Growth driven by year round specialty crop production in North Africa Growth in Namibia and Zambia driven by crop exports to Southern Africa Strong increase in crop planting in South Africa but grain production

affected by dry weather Farmers from Zimbabwe and South Africa relocating in Zambia.



Cotton 22.0%

Cereals 17.3%

Maize 9.4%

Rice 7.1%

Morocco $130 m.

Turkey $286 m.

Kazakhstan $157 m.

South Africa $182 m.


Industry Overview

05,000

10,00015,00020,00025,00030,00035,00040,00045,00050,00055,000

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

$mHerbicides 43.7%

Insecticides 27.5%

Fungicides 25.8%

Others 3.0%

WORLD


2013 ($m) 54,208 6,481 20,100

Growth 2013/2012 (%) +9.4 +1.7 +8.7

Forecast 2018 ($m) 61,506 7,586 22,928

Forecast 2018/2013 (% p.a.) +2.6 +3.2 +2.7

Crop Protection



Cereals 16.7%

Soybean 14.0%

Maize 11.6%

Rice 9.6%

Cotton 5.1%

Latin America $14,026 m.

NAFTA $10,011 m.

MEA $2,105 m.

Europe $13,634 m.

Asia $14,432m.


Industry Overview


overview 2013

Documents

crop agrochemical market

world crop protection

global crop protection

crop protection sector

leading crop protection

global market

crop use

market sectors