Agrochemicals Market

Growing demand for food owing to the rising population to boost the market growth

Consumption patterns are changing as a result of the increasing population and wealth around the world. Along with increasing production to meet demand, there is a need to care for the nutritional requirements of an increasingly affluent population. For instance, the IMF estimates that India will have a population of 1.39 billion in 2021. According to FAO, severe food insecurity will affect 11.7% of the world's population in 2021. Waste is caused by shrinking arable land and crops lost to pest attacks, a major obstacle to ensuring food and nutritional security.

The US Department of Agriculture reports that since 2000, the total amount of land used for farming in the US has decreased yearly. As of 2021, there were 895.3 million acres of farmland worldwide, a drop of nearly 50 million. These elements drive up the demand for agrochemicals, increasing agricultural productivity.

Moreover, governments, especially in Asian countries, are taking government initiatives to support farmers by initiating several programs. For instance, the Indian government places a high priority on farmer welfare and is enacting a number of farmer's welfare programs to boost the agricultural sector and enhance farmers' economic circumstances. The government has rolled out several new initiatives like Neem Coated Urea, Soil Health Card Scheme, Paramparagat Krishi Vikas Yojana (PKVY), Pradhan Mantri Fasal Bima Yojana (PMFBY)National Agriculture Market (e-NAM), Pradhan Mantri Krishi Sinchayee Yojana (PMKSY), and Interest Subvention Scheme. All farmers will benefit from these programs.

Further, the Australian government is helping the agriculture sector reach its target of $100 billion in production by 2030. This is another factor driving the growth of the Agrochemicals market revenue.

Additionally, it is anticipated that the expanding animal husbandry and animal feed industries will favorably affect the expansion of the world agrochemicals market. The largest feed industry in the world is found in the United States. The American Feed Industry Association (AFIA) estimates that in 2020, the U.S. exported 32.4 thousand tons of animal feed at a value of USD 13 billion. Thus, this has enhanced the Agrochemicals market CAGR globally.

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In April 2024, the Ministry of the Environment granted final approval for the experimental cultivation of a specific type of rice in open fields using advanced genomic techniques called as TEA, or assisted evolution techniques, in Italy. This rice variety possesses inherent resistance to the Pyricularia oryzae fungus, commonly referred to as "brusone" or rice blast fungus. It is capable of withstanding the attacks of this fungal pathogen without the need for fungicides. Rice blast fungus is a highly detrimental disease that can cause significant production losses, sometimes up to 50%, in certain years.

The University of Milan submitted a request for clearance to conduct experiments on plants generated via genome editing or cisgenesis, in accordance with the regulations governing field trials. The laboratory studies utilizing resistance testing have yielded outstanding outcomes in terms of productivity, all without the application of agrochemicals.

In March 2023, the governments of Ecuador, India, Kenya, Laos, Philippines, Uruguay, and Vietnam have collaborated to initiate a $379 million effort aimed at addressing pollution caused by the utilization of pesticides and plastics in agriculture. Chemicals are essential in agriculture, with over 4 billion kg of insecticides and 12 billion kg of agricultural plastics being utilized annually. Although these compounds have advantages in increasing food production, they also provide substantial hazards to human health and the environment.

Up to 11,000 individuals perish each year owing to the poisonous properties of pesticides, and the presence of chemical remnants can harm ecosystems, reducing the fertility of soil and the ability of farmers to adapt to climate change. The incineration of agricultural plastics during their initial disposal further exacerbates a global air pollution emergency, resulting in one out of every nine fatalities worldwide. Toxic persistent organic pollutants (POPs) are released into the environment by very hazardous pesticides and mismanaged agricultural plastics. These chemicals do not degrade and instead contaminate the air, water, and food.

The cost of these inputs is typically lower than that of sustainable alternatives, which provides farmers with minimal motivation to embrace more effective methods.

Global trade dynamics are shaping the Global Agrochemicals Market Industry as countries engage in the exchange of agricultural products and inputs. The liberalization of trade policies and the establishment of trade agreements facilitate the movement of agrochemicals across borders, enhancing market accessibility. This interconnectedness allows for the sharing of innovative agrochemical solutions and best practices among nations. As a result, the market is poised for growth, with increasing international demand for high-quality agrochemical products. The interplay of global trade and agrochemical innovation is likely to drive the Global Agrochemicals Market Industry forward, fostering collaboration and competitiveness.

The Global Agrochemicals Market Industry is experiencing growth driven by the increasing global population, which is projected to reach approximately 9.7 billion by 2050. This demographic surge necessitates enhanced agricultural productivity to meet rising food demands. As a result, agrochemical products such as fertilizers and pesticides are becoming essential for maximizing crop yields. In 2024, the market is valued at 365.6 USD Billion, reflecting the urgent need for innovative solutions in agriculture. The demand for sustainable practices further emphasizes the role of agrochemicals in ensuring food security, thereby solidifying their importance in the Global Agrochemicals Market Industry.

Government support and subsidies play a crucial role in the Global Agrochemicals Market Industry. Many countries are implementing policies to promote agricultural productivity and food security, which often include financial assistance for agrochemical purchases. For example, various governments provide subsidies for fertilizers and pesticides to encourage farmers to adopt modern agricultural practices. This support not only boosts the agrochemical sector but also enhances overall agricultural output. As the market continues to expand, government initiatives are expected to remain a driving force, ensuring that the Global Agrochemicals Market Industry remains robust and competitive in the coming years.

The Global Agrochemicals Market Industry is increasingly influenced by the rising demand for sustainable agriculture practices. Consumers and regulatory bodies are pushing for environmentally friendly solutions that minimize chemical residues in food production. This shift is prompting agrochemical manufacturers to develop bio-based and organic products that align with sustainability goals. The market's growth is further supported by initiatives aimed at reducing the environmental footprint of agriculture. As a result, the Global Agrochemicals Market Industry is likely to witness a compound annual growth rate of 3.77% from 2025 to 2035, reflecting the industry's adaptation to changing consumer preferences and regulatory pressures.

Technological advancements are significantly influencing the Global Agrochemicals Market Industry. Innovations such as precision agriculture, biotechnology, and digital farming tools are enhancing the efficiency of agrochemical applications. These technologies allow for targeted usage of fertilizers and pesticides, minimizing waste and environmental impact. For instance, the integration of drones and satellite imagery enables farmers to monitor crop health and apply agrochemicals more effectively. This trend is expected to contribute to the market's growth, with projections indicating a market value of 549.4 USD Billion by 2035. The adoption of these technologies is likely to reshape the landscape of the Global Agrochemicals Market Industry.

By Region, the study provides market insights into North America, Europe, Asia-Pacific, and the Rest of the World. Asia Pacific agrochemicals market accounted for USD 154.3 billion in 2022 and is expected to exhibit a significant CAGR growth during the study period. The top regional market contributors include China, Japan, and India. According to the International Trade Center (ITC) and FAO, China is the world's largest manufacturer and exporter of pesticides. According to the Organization for Economic Co-operation and Development (OECD) and FAO, India is the fourth-largest producer of agrochemicals in the world, after China, Japan, and the United States.

Moreover, the China Agrochemicals market held the largest market share, and the India Agrochemicals market was the fastest-growing market in the Asia-Pacific region.

Further, the major countries studied in the market report are: The U.S., Canada, Germany, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.

Figure 3: Agrochemicals Market Share By Region 2022 (%)

Source: Secondary Research, Primary Research, Market Research Future Database and Analyst Review

Europe Agrochemicals market accounts for the third-largest market share. Agrochemicals are crucial for achieving high yields as they are essential for preventing pests and diseases in the field. Because more people are eating cereals and grains like rice, wheat, rye, corn, oats, sorghum, and barley, there is an increase in demand for fertilizers. This is expected to fuel the market in this Region. Further, the Germany Agrochemicals market held the largest market share, and the UK Agrochemicals market was the fastest-growing market in the European Region.

The North America agrochemicals Market is held the second largest market in 2022. Moreover, the U.S Agrochemicals market held the largest market share in 2022. The U.S. dominated the North American agrochemicals market due to the rising demand for commodities like blueberries, sorghum, soy, and maize. In addition, the United States is the world's largest producer of maize, sorghum, blueberries, and almonds.

The Major market players are increasing their spending on their R&D initiatives to increase their footprint in the market. Market participants also want to expand their presence by updating their market developments, such as new product launches, contractual agreements, mergers and acquisitions, increased investments, and collaboration with other organizations. Additionally, studies indicate that the market leaders in the Agrochemicals industry are expected to offer their products at a moderate price to further garner a more extensive consumer base.

One of the primary strategies the Agrochemicals Industry market leaders are undertaking is expanding their clients by manufacturing locally to reduce operating costs. During the forecast period, the Agrochemicals industry has provided various products reaping significant benefits. The Agrochemicals market major player such as The Mosaic Company (US), Bayer CropScience Limited (Germany), The Dow Chemical Company (US), BASF SE (Germany), Monsanto Company (US), Syngenta AG (Switzerland), Adama Agricultural Solutions Ltd (Israel), Nufarm Limited (Australia), Arysta Lifescience Corporation (Japan), and Crystal Crop Protection Pvt.

Ltd. (India), and others are working on expanding the market demand by investing in research and development activities.

Crystal Crop Protection Pvt. Ltd. is an R&D-based crop protection manufacturing and marketing company. Crystal's products are designed to support the entire crop lifecycle from planting to harvesting. The business offers crop protection options to Indian farmers to help them increase productivity and profitability on their farms. In February 2022, Crystal Crop Protection Limited introduced its new product HOLA, a post-emergent herbicide to safeguard sugarcane crops nationwide from weeds.

Bayer Crop Science manufactures crop protection products like herbicides, insecticides, fungicides, and seed treatments. In January 2022, Bayer Crop Science introduced Ambition, a formulation of a crop supplement containing amino acids and fulvic acids in China.