The China crop protection chemicals market is projected to witness a CAGR of 3.8% during the forecast period (2021-2026). China is one of the major producers of both active ingredients that form the base of formulated agrochemical products, and the ready-made pesticides sold in many countries. During the COVID-19 pandemic, some of the Chinese factories were shut temporarily which affected the supply of chemicals to major importing countries such as the United States, Brazil, India, Argentina, and Australia.

China is the leading producer and exporter of crop protection chemicals, globally. Insecticides hold the major share among all the crop protection chemicals with 49.0%. Large population, small farm sizes, food security, and the need for high farm efficiency are the prime drivers of the market. China’s government plans for planting areas of several crops include providing more area for rice and wheat to meet the domestic demand and become independent of grains imports will further give a boost to the market.

The use of chemical pesticides in China is observing a downward trend and witnessing a gradual shift towards the use of biological pesticides. The Ministry of Agriculture led the “Zero Growth Policy of Pesticides and Fertilizers by 2020” in 2015 to phase out the use of synthetic pesticides and instead encouraged the use of bio-based and organic products.

Additionally, China is one of the largest exporters of agrochemical products to different countries and has many local and global level manufacturers like BASF, Nutrichem Company Limited, Fuhua, and others.​

Key Market Trends

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Increasing Area Under Organic Production Creates to Higher Demand for Bio-Based Chemicals

The overuse of chemical fertilizers and pesticides has been a rising concern in China, which led the government to intervene in maintaining agricultural sustainability and the health of the ecological environment. Due to the high usage of chemicals on agricultural crops, the Chinese government, in 2015, issued a “zero-growth policy”, to reduce the use of chemical pesticides and fertilizers by 2020, while pushing toward the green development of its agricultural sector.

Owing to this, there has been a replacement in the use of high toxicity and high residue pesticides with low toxicity and low residue pesticides, such as organic pesticides and biopesticides. Furthermore, the area under organic production has increased from 2.28 million hectares to 3.13 million hectares between 2016-2018. This increasing area leads to higher demand for bio-based products. Therefore, China’s registration of biopesticides is rising continuously, especially, the registration of microbial pesticides.

Owing to an increased focus on environmental sustainability while maintaining the crop output, the demand for bio-insecticides in the country is expected to increase in the coming years. ​

Insecticide Segment Dominate the Market

Insecticides constitute the major share of pesticides’ revenue. The insecticide segment holds a significant share of the pesticide market. Insecticides are the most common pesticides registered for use on cotton. Among them, one with the largest number of registered active ingredients is phoxim, followed by cypermethrin and beta-cypermethrin

Abamectin is also the most widely used biological insecticide to protect cereals, soybean, cotton, fruit and vegetables, and even ornamentals from serious insect infestations.​ These insecticides are majorly targeted to control pests such as cotton bollworm, aphids, cabbage caterpillar, diamondback moth, and red spider mite.

With the increasing concern over the infestation of these pests, companies are continuously developing new active ingredients to prevent crop damage from pests. For instance, in Dec 2020, Bayer Crop Science China launched its new generation patented insecticide Tetraniliprole, under its trade name Vayego in Guangzhou, China.

Competitive Landscape

China's crop protection chemical market is a fragmented market. Companies, such as Syngenta, Bayer Cropscience, BASF, and UPL, have expanded their presence in China by enhancing pesticide production and through increased focus on strategic moves like mergers and acquisitions to have a strong foothold in the Chinese market. Few active players in the Chinese crop protection chemicals market includes Nutrichem Company Limited, Shandong Weifang Rainbow Chemical Company Limited, Zhejiang Wynca Chemical Industry Group Co. Ltd, Sichuan Leshan Fuhua Tongda Agrochemical Technology Co. Ltd, etc.

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