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Pesticide price index in China
7/22/2023 8:38:42 AM

Pesticide price index in China

In May 2023, the total amount of glyphosate imported into the United States decreased by 97.9% compared to the same period last year. The North American market imported 65.7% less glufosinate in 2023. Total North American generic herbicide imports fell 45.2 percent. North American demand for the three major generic herbicides fell significantly in May. This cooled the already stagnant market.

China's pesticide exports fell significantly to 660,000 tonnes in the first quarter of 2023 compared to the same period in 2022, according to recently released public data from ICAMA. This year's figure is similar to China's total raw material export value in the first quarter of 2021. Likewise, the value of China's total pesticide exports in the first quarter of 2023 fell by 63% in 2022. Chinese manufacturers' gross profit margins for technical pesticide ingredients are approaching historic lows.


During a market downturn, almost all procurement teams wait for a price inflection point to emerge. However, even reaching a milestone doesn't mean a big deal is imminent. As we predicted earlier this year, order-splitting and price-cutting by multinationals is becoming the new reality. In 2023, price will no longer be a key factor for Chinese pesticide companies looking to increase sales.

The current gross margin for glyphosate in China is close to 15%. The price of yellow phosphorus has increased recently. So, has the glyphosate price tipping point been reached? Contrary to the opinions of many glyphosate sales executives, we believe that the price tipping point for glyphosate has not yet been reached. The higher price of yellow phosphorus is mainly due to weak downstream glyphosate demand and modest adjustment of upstream yellow phosphorus production. The high price of yellow phosphorus reflects the current weak sales of the glyphosate market. On the other hand, as the yuan has continued to depreciate against the US dollar recently, this has also reduced the dollar price of raw materials produced in China. The downward trend in the price of bulk agricultural chemicals such as glyphosate will continue.

Currently, there is an increase in glyphosate inquiry orders in the Chinese market. The reason may be more to provide higher cost support to sell the glyphosate formulation in overseas markets at a lower price. The stagnation of the entire Chinese agricultural industry in 2023 is inevitable.

For generic pesticides, it will be very difficult to achieve all these characteristics. Chinese innovation teams should focus their attention on one or more areas of overlapping innovation, such as the targeted synthesis of chiral pesticide isomers to increase efficacy and reduce dosage, the development of innovative formulation delivery systems, and the development of innovative biologics.