CAC Shanghai 2018: Overview of China’s agrochemicals market
On 7-9 March 2018, the biggest contributors to the agrochemical industry in China and worldwide are gathering at one place, to place the tracks for the agrochemical market in 2018. The 19th China International Agrochemical & Crop Protection Exhibition (CAC 2018) will be held in Shanghai. The event comes together with the 19th China International Agrochemical Equipment and Crop Protection Equipment (CACE 2018) as well as the 9th China International Fertiliser Show (FSHOW 2018).
These exhibitions are an inevitable platform for all enterprises that do business in the agrochemical market in China. They serve as the meeting point for businesses to achieve trade, exchange, and cooperation with China’s agrochemical players.
CCM, a Chinese market intelligence company with a focus on China’s Agrochemicals market, reveals the most important trends for the year 2017 and recommends, what companies can expect from the CAC 2018 and do to achieve their goals in the pesticides market in China, 2018.
The CAC was first launched in 1999 and has become since then the world largest agrochemical exhibition. After the depressing year of 2016, the exhibition especially opens a window for the Chinese agrochemical enterprises to get their food into international markets.
The CAC 2018 will play a huge role in the development of the further agrochemical industry in China. All big players will attend the exhibition, domestic and worldwide. The exhibition contains over 60,000 square meters, offering a place for over 1100 agrochemical suppliers from over 20 countries and more than 30,000 industry professionals from over 120 countries.
Some of the attending world leading enterprises are Dow Agroscience and Huntsman. Chinese leading manufacturers, that will attend, are Nutrichem International, Jiangsu Huifeng, Sinochem International Corporation, and Shandong Binnong.
Outlook for China’s Pesticides Market 2018, Golden Times for Overseas Traders
According to market intelligence firm CCM, the pesticides industry in China will continue rising in 2018, supported by the elimination of further excessive production capacity and outdated enterprises. This will lead to an upgrading of the industry domestically and enhance the competition in international pesticides markets.
Overall, China's pesticide use has dropped in the past three years constantly. The middle kingdom has announced in 2015 the goal to achieve zero growth in the number of pesticides used by 2020, and, according to official reports, it has already seen negative growth over the last three years, likely to continue in the future.
Environmental regulations have posed significant impacts on domestic
pesticide industry in 2017. China's environmental policies always work well in regulating the market. Stringent administration helps cut out small-sized or even unlicensed producers and favours the development of leading enterprises.
What’s more, by 2025, hazardous chemical producers that do not meet safety standards have to move into designated industrial parks in China or shut down their facilities. This regulation is likely to affect the supply of pesticide intermediates in China for 2018, as small- and medium-sized enterprises, as well as large enterprises with major potential risks, have to start relocation before 2018 and finish before the end of 2020, according to CCM’s research.
The year 2018 will benefit the Chinese pesticides manufacturers that already have upgraded their production processes and are in possession of a highly integrated supply chain, able to generate their needed raw materials by themselves to avoid high purchase costs.
Hence, leading enterprises in this industry are going to have more power in the market as environmental inspections and safety inspections become a normal routine in the foreseeable future. The main advantages of large pesticides enterprises are the self-sufficiency in raw materials and the resulting independence of market voluntarily, the implementation of new national standards for pesticides to fight fake and counterfeit products, as well as big overseas markets with growing demand and already existing clients.
China’s pesticides industry is facing a bunch of challenges that will continue to put pressure on enterprises in 2018. Overall, the recovery of the global economy will still be a major support to domestic supply.
As China is the largest pesticides exporter worldwide, the country is depending highly on the development of global markets and the demand for agrochemicals. Especially small enterprises have an uncertain future in China, not able to update their production and waste disposal technology to the required standards and lacking overseas clients for sufficient profitably of their sales. Hence, mergers and acquisitions will continue throughout China’s pesticides companies in 2018.
Due to the low quality of Chinese pesticides formulation and high barriers to enter overseas markets with own pesticide brands, traders are still one of the main purchasers of Chinese pesticides, mostly pesticides technical, to process them into higher quality pesticides formulations and sell them under well-established brands in their respective markets.
Hence, foreign traders have a great opportunity to collaborate with Chinese pesticide manufacturers and sell their products under local names. Especially traders with a good distribution network can profit highly from bringing the Chinese products in the local market, creating a win-win situation for Chinese manufacturers and themselves.
How China’s environmental pollution crackdown affects the agrochemical industry 2018
The Chinese government is paying greater attention to environmental protection. Throughout the year 2017, the stricter environmental inspections, the replacement of environmental protection fee with environmental protection tax, and the pollutant discharge permit system helped cleaning the agrochemicals market from heavy polluters and outdated production technology. In China, a major campaign against environmental violations has so far penalized more than 30,000 companies and over 5,700 officials.
As China’s fight against pollution is getting fiercer, CCM is analyzing how the environmental protection measurements are affecting the agrochemicals industry in 2018 and what international players can expect for the near future.
Notably, the environmental tax amounts only took up a small proportion in some leading enterprises in China, Specifically, in 2016 the companies only paid taxes according to about 0.10% of their total revenues. According to market intelligence form CCM, large enterprises have complete pollutant discharge disposal facility and environmental equipment, plus the rising pesticide prices compared to their small and medium-sized competitors, so they won't face such great pressure in 2018.
Companies involved in the Chinese agrochemicals industry have to expect an overall rise in the cost of doing business. However, the scale of the impact will depend on the location of the affected companies, because the pollution tax rates are decided at the provincial level.
Because of this issue, regions with large manufacturing bases may set their tax rates lower to retain the fiscal revenue. There are also some important exemptions to the Environmental Protection Tax. Firms that discharge pollutants directly to centralized sewage and waste treatment facilities and those that dispose of solid wastes in facilities that meet the local and national standards are exempt from the tax.
Previous: China’s Top Pesticide Manufacturers
- When Is The Best Use Of Fungicides?
- What Types Of Fungicides Are Classi...
- Precautions For Using Insecticide
- Why Are Fungicide More And More Use...
- Precautions For Insecticides
- Method Of Proper Use Of Plant Fungi...
- Prospects For The Development Of Bi...
- The Difference Between Plant Hormon...
- Important Function Of Fungicide
- What Are The Commonly Used Plant Re...
- China’s Top Pesticide Manufacturers
- Main Pesticide Price Changed Last W...
- Brazil Law Speeding Up Pesticide Ap...
- China-owned Syngenta Plots Growth I...
- India Government Asks Agro-chemical...
- Jiangsu Likely To Close Down Pharma...
- Price & Supply: Production Shutdown...
- 2017 China Pesticide Import/Export ...
- EU To Ban Bee-killing Pesticides
- EU Court Upholds Insecticide Ban To...