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China Stock Listed Fertilizer and Pesticide Companies Report, 2006-2007

Published: Aug/2007

 Hard Copy  USD $ 1,600
Pages: 115 Electronic(PDF)  USD $ 1,700
Report Code: FY019 Enterprisewide  USD $ 2,550
 

China, a big fertilizer producer, has the largest fertilizer output in the world. There are 1000 plus fertilizer manufacturers in China, of which 600, 400 and 47 enterprises are engaged in nitrogenous fertilizer production, phosphor fertilizer production and potassium fertilizer production respectively. 

Global Fertilizer Output and Demand


Source: CPCIA; China Galaxy Securities Co., Ltd.

In Jan-Nov 2006, China's fertilizer output reached 47.789 million tons, up by 12.7% year on year, of which nitrogenous fertilizer, phosphor fertilizer and potassium fertilizer were 35.021 million tons, 10.846 million tons and 1.862 million tons respectively, up by 11.7%, 15.5% and 17.5% over the same period of last year. In 2006, due to abundant domestic fertilizer supply and the price hike in international fertilizer market, 11.29 million-ton fertilizer was imported, down 19.2% year on year, of which carbamide import, compound fertilizer import and potassium chloride import were 40,000, 1.72 million and 5.94 million tons, down by 40.3%, 18.3% and 26.6% respectively.

In 2006, domestic fertilizer price ranked high initially but declined later, and the average price of main fertilizer varieties decreased over 2005. Carbamide and ammonium hydrogen carbonate had a price hike of 3.3% and 4.6% respectively over 2005; the average retail prices of Di ammonium phosphate, calcium super-phosphate and potassium chloride respectively rose by 0.4%, 4.2% and 4.6% over 2005. As for the price trend of fertilizer in 2007, there are different predictions. Generally speaking, fertilizer price is mainly influenced by supply and demand, cost and related national policies in 2007. In addition, opening winter storage, fertilizer wholesale and retail business as well as related services to foreign-funded enterprises will also have an impact on fertilizer price.

In Apr 2007, China's fertilizer output totaled up to 5.2285 million tons, up by 11.27% over Apr of 2006. The accumulated fertilizer output in Jan-Apr 2007 reached 18.5036 million tons, up by 10.74% over the same period of 2006. The top 3 provinces on output are Shandong, Hubei and Henan.

At present, China has 2000 plus pesticide manufacturers, which are universally in a small scale. Enterprises with the annual sales value of over RMB 10 million and RMB 5 million account for about 17% and 30% respectively. The enterprise having the largest market share only covers less than 4% of the market, 15 largest pesticide enterprises share about 25% of the market; by contrast, the accumulated sales value of the world's top 8 pesticide & chemical groups has accounted for over 80% of the total in global pesticide market. 

China produces about 260 varieties of pesticide, and the product structure has been remarkably improved over the past period, yet high-toxic pesticide is still the majority. Among China's three major pesticide products, the proportion of insecticide, herbicide and bactericide is around 60:30:10, widely different from the rational 30:50:20 of developed countries. In terms of variety internal structure, high-toxic organic phosphor pesticide accounts for 70% of insecticide output; few herbicide products are suitable to rape field, cotton field and vegetable field, most are applicable to rice field, wheat field and soybean field. WP and EC account for 70% of the total, and there are few advanced SC herbicide varieties. Regarding China's pesticide sales, high-toxic and virulent pesticide still accounts for nearly 50% of the total, seriously damaging food safety.

Due to weak R & D ability, China's pesticide manufacturing enterprises do not have core competency. Pesticide industry belongs to technology-intensive industries, and current pesticide manufacturing technologies are developing towards high-tech, automation and bio-technology. In China, the annual R & D expense invested by enterprises (including the state) is more than 2% of its annual sales value; however, foreign giants spend about 10% of the annual sales value into R & D. For instance, the sales income of Syngenta Company in 2003 was USD 6.6 billion, 700 million of which was infused into R & D; over 10% of the sales value of Bayer or Du Pont is used for research and development as well. 

China's Pesticide Output, 2001-2006 (unit: 1,000 tons)


 
Source: Bureau of Statistics of China

In 2007, the pesticide industry will simultaneously maintain the growth of economic aggregate. Facing increasingly expanded market scale, certain market opportunities still exist.

The report provides detailed information and statistics of nearly 20 listed companies in China's fertilizer and pesticide industry, regarding overall comparison, performance, operation and investment, and makes elaborate analysis on main business structure and latest market trend. 


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