For the crop protection industry rice is the most important crop by value. Experts are of the opinion that its contribution is between 35 to 40% for the crop protection industry, where insecticides are the biggest segment.4 Also for herbicides and fungicides the current usage – according to experts – in India is very low in comparison to other rice producers and therefore in future both segments will be in an important role.
Besides that the seed business is becoming very interesting. Different research studies and reports have been recently published claiming that rice yields can be raised at least by 15 – 20% by adopting hybrid rice varieties.5 The reported area under hybrids in India is around 3%. Just for the comparison, in China, who is the biggest rice producer globally, the area under hybrid rice is around 53% and approximately 58% of its production depends on hybrids. Also the yields in India are very low. China, for example is looking to introduce new super hybrid varieties for rice by targeting 15 t/ha, whereas the yields in India are around 3.5 t/ha.3
There is also a current discussion about the introduction of BT rice varieties that appears close to commercialization in India, which may take some value from the insecticides sector. But until now, no announcements by the Government of India regarding BT rice have been made.
Cotton used to be the most important crop for the Indian crop protection market, but now has been overtaken by rice, due to the decline of its value as explained by experts mainly impacted by BT cotton. On the other hand BT cotton area and its trend are positive. India belongs to the 15 biotech-mega-countries (ranking 4th globally) and planted in 2011 a record area of 10.6 Million HA of BT cotton which occupies 88% of the total cotton planted area in India.6
In general, the development in the seed business has been very positive but due to the BT adoption, the value of insecticides decreased and the market for herbicides is estimated to be at a relatively low level in India for cotton. One of the main reasons is the low consumption of agrochemicals in general in India.
Cereals in India are the third most important crop by its value for the crop protection industry. The main segment is herbicides. Although the cultivated area is in a decreasing trend, but the crop protection market value is growing in experts’ perspective. On the global level, India is one of the top producers of for cereals. According to FAOSTAT rankings, India is the biggest producer for Sorghum and Millet and second biggest for Wheat, by keeping in mind, that India is still a low yield producing country.
In chart 2, it is clearly visible that the yields in India in comparison to global and regional averages are very low. Thus the potential in production increase due to yield increase in India is massive.
Besides that other crops such as fruits and vegetables (especially for exports, i.e. apples, grapes and mangoes) and oilseed rapes are also gaining importance and the crop protection markets are significantly moving towards a positive direction.
In total, according to experts the outlook for India, especially in the long-term is very positive. On the one side, new varieties and the adoption of GM crops is gaining importance within the public and private sector, but on the other side one should not ignore the potential of the agrochemical market. There is still a huge potential for the crop protection industry, especially by knowing that the current agrochemical consumption per HA by India is far from the world average, thus in India the current consumption is around 600g per HA in comparison to the 3000g per HA World average.7 Besides that the agrochemical consumption and its penetration amongst farmers is significantly low. The current agrochemical consumption in India is limited to 25% of the arable land.8 The main reason for this low level of consumption is basically the lack of awareness among farmers regarding the benefits of the use of crop protection products.
In general, it can be addressed that with more governmental support for agriculture and by providing a sustainable infrastructure, it is just a matter of time, when India will become the top producer for major agricultural commodities and the leading market for the seed and crop protection industry. The potential of the country is visible but has to be correctly utilized by the public and private sector together.