US Agrochemicals & Pesticides Product Market Overview
US Agrochemicals & Pesticides Product Market size is forecast to reach US$40.5 billion by 2027 after growing at a CAGR of 2.8% during the forecast period 2022-2027. Food security is one of the most critical challenges. According to the United Nations, by 2050, the world must feed 9 billion people. The demand for food will be 60% greater than it is today. To achieve this, agriculture has to become more productive. Agrochemicals are used to protect crops from insects, infestation, and diseases and promote healthy plant growth. They include pesticides, fertilizers, soil conditioners, plant growth regulators, etc. Pesticides are used to control pests and include herbicides, insecticides, fungicides, nematicides, rodenticides, etc. Fertilizers are used to increase crop yield and are of two types inorganic or chemical fertilizers which include nitrogenous fertilizers, phosphatic fertilizers, potassic fertilizers, and complex fertilizers and organic fertilizers which comprise manure, bone meal, compost, green manure, etc. Increasing usage of biopesticides drives the US agrochemicals & pesticides product market.
COVID-19 Impact
The COVID-19 pandemic resulted in severe economic repercussions. The US agriculture sector felt the heat due to supply chain issues, pricing issues, and market disruptions. Lockdowns impacted the restaurant, hospitality, and transportation sectors, causing the demand for meat products, sugar, and other raw and manufactured agricultural products to shrink. The WHO declared COVID-19 as a pandemic in March, which is close to springtime during which fruits and vegetables are harvested. Fruits and vegetables are usually handpicked. The number of migrant farmworkers reported positive for COVID-19 rose steadily in the US leading to a shortage of labor. This translated into reduced supply and higher prices of fruits and vegetables at the grocery stores. On account of the closing of restaurants and schools and COVID-19 outbreaks at processing facilities, the meat supply chain faced major challenges. This also impacted the market for agrochemicals and pesticides products. The United States Department of Agriculture (USDA) rolled out the Pandemic Assistance initiative in March 2021 and announced assistance to producers and agriculture entities through several programs.
US Agrochemicals & Pesticides Product Market Segment Analysis – By Product
Pesticides held a significant share in the US agrochemicals & pesticides product market in 2021. A pesticide is any substance that is used to control pests. Pesticides include herbicides for destroying weeds and other unwanted vegetation, insecticides for controlling a wide variety of insects, fungicides used to prevent the growth of molds and mildew, rodenticides are used to control mice and rats. Pesticides can be synthetic or biological in origin. The use of pesticides increases food production as it reduces crop losses due to pest infestation. According to the United States Geological Survey (USGS), about 1 billion pounds of conventional pesticides are used each year in the United States to control weeds, insects, and other pests. Herbicides are the most widely used type of pesticide. According to the EPA, 85% of all pesticides produced are used in agriculture and the rest in lawns, gardens, forestry, etc. A Minnesota survey found that on a per-acre basis urban dwellers use herbicides for lawn care at rates equal to those used by farmers for food production. According to surveys by the U.S. Environmental Protection Agency (EPA), more than three-quarters of U.S. households use pesticides. However, due to awareness regarding the harmful effects, the use of conventional pesticides is decreasing and the usage of biopesticides is increasing. Thus, the pesticide segment is set to dominate the US Agrochemicals & Pesticides Product Market during the forecast period.
US Agrochemicals & Pesticides Product Market Segment Analysis – By Crop Type
The cereals segment held the largest share in the US agrochemicals & pesticides product market in 2021 and is expected to grow at a CAGR of 2.5% during the forecast period. According to the USDA, corn, wheat, rice, oats, and barley are the food grains or cereals that are grown in the US. The United States is a major wheat-producing country, and wheat ranks third among US field crops. Corn is the most widely produced feed grain in the country and accounts for more than 95% of total production and use. The other three major feed grains are sorghum, barley, and oats. According to the U.S. Grains Council, during 2020-2021 the United States exported 69.8 million metric tons (2.7 billion bushels) of corn to 73 different countries. During the same period, U.S. sorghum exports totaled 7.18 million metric tons (283 million bushels). Therefore, grains are also economically important to the country and it is of high importance to ensure high yields and production which can be achieved by using agrochemicals and pesticides. This boosts the demand of agrochemicals and pesticides product sales and thereby the US agrochemicals & pesticides product market.
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US Agrochemicals & Pesticides Product Market Segment Analysis – By Application
The agriculture segment held the largest share in the US agrochemicals & pesticides product market in 2021 up to 70%. According to Economist Impact 2021 Global Food Security Index (GFSI), a decline in global food security for the second consecutive year was reported. The growing demand for food is constantly increasing the need for agricultural productivity, which accelerates the demand for agrochemicals. According to the FAO, the major crops grown in the US are corn, soybean, wheat, cotton, tobacco, rice, sorghum, and barley. According to the 2021 Crop Production Annual Summary released by the USDA’s National Agricultural Statistics Service (NASS), corn and soybean production went up in 2021. US corn growers produced 15.1 billion bushels, up 7% from 2020. Soybean production for 2021 totaled a record-high 4.44 billion bushels, up 5% from 2020. For 2021, all cotton production was up 21% from 2020, at 17.6 million 480-pound bales. The use of agrochemicals helps to increase crop yield. According to the USDA, wheat, corn, rice received about 40% of the nitrogenous fertilizers, phosphatic fertilizers, and potassic fertilizers in 2020. Thus, the agricultural segment is the largest market for agrochemicals and pesticides products and will continue to dominate the market during the forecast period.
US Agrochemicals & Pesticides Product Market Drivers
Increasing Usage of Biopesticides
Biopesticides are pesticides derived from natural or biological materials. Microbial biopesticides, biochemical biopesticides, and plant-incorporated protectants (PIPs) are the types of biopesticides. The US is the largest market for organic food. According to the Organic Trade Association, sales of organic food rose 12.8% to $56.5 billion in 2020. This large organic market boosts the usage of biopesticides. A streamlined registration process is also driving the biopesticides market’s growth in this region. In the US, biopesticides are regulated by the EPA with fewer documents required for registration compared to chemical pesticides. This is attributed to the fact that biopesticides pose fewer risks than their chemical counterparts. On account of the simple registration process, new biopesticides are usually registered in less than one year whereas the average registration period is three years for synthetic pesticides. As green agrochemicals, biopesticides have a great influence on sustainable agriculture. Hence, the increasing usage of biopesticides acts as a driver for the US Agrochemicals & Pesticides Product Market.
Limited Availability of Farmland
Farmland is agricultural land that is used for crops, pasture, or grazing. According to the USDA, the number of farms and farm size is decreasing every year. For instance, according to the National Agricultural Statistics Service, the number of farms in the country in 2019 was down by 5,800 in 2018. The number of farms in the United States for 2019 is estimated at 2,023,400, down 5,800 farms from 2018. Total land in farms, at 897,400,000 acres, decreased 2,100,000 acres from 2018. The main reason behind decreasing farmland is an increase in urbanization. Rapid urbanization has had a detrimental impact on land availability. Hence with limited farmland, it is essential to increase the crop yield which can be achieved through the use of agrochemicals and pesticides. Therefore, this drives the US agrochemicals & pesticides product market.
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US Agrochemicals & Pesticides Product Market Challenges
Alternative Crop Protection Methods
Alternative methods are being used instead of relying on agrochemicals. The use of genetically modified organism (GMO) crops and integrated pest management (IPM) limit the use of agrochemicals and pesticides. Most of the GMO crops grown today were developed to help farmers prevent crop loss. The three most common traits found in GMO crops are resistance to insects, tolerance to herbicides, and resistance to plant viruses. This brings down the dependence on pesticides. According to the US FDA, soybeans, corn, sugar beets, canola, and cotton are the GMO crops grown in the US. IPM is a series of crop protection strategies to grow healthy crops and minimize the use of pesticides. IPM combines the use of biological, cultural, and chemical practices to control pests in agriculture. Awareness about these alternative crop protection methods and their implementation can prove to be challenging for the US agrochemicals & pesticides product market.
US Agrochemicals & Pesticides Product Industry Outlook
Product launches, acquisitions, and R&D activities are key strategies adopted by players in this market. US agrochemicals & pesticides top 10 companies include:
Yara International ASA
Bayer Crop Science
Gowan, Inc.
Dow Agro Sciences
Syngenta
Nutrien Ltd.
BASF
Corteva Agriscience
ADM
FMC Corporation
Recent Developments
In December 2021, FMC Corporation, a leading global agricultural sciences company, signed multi-year agreements with Corteva Agriscience to continue to supply Rynaxypyr and Cyazypyr actives to Corteva for seed treatment products. These multi-year agreements extend the existing global collaboration between the two companies. Seed-applied insecticides powered by Rynaxypyr and Cyazypyr actives help growers protect their seed investment against key insect pests, resulting in improved yield and higher quality crops. In June 2021, FMC Corporation received U.S. Environmental Protection Agency (EPA) registration for Fluindapyr, a novel broad-spectrum succinate dehydrogenase inhibitor (SDHI) fungicide. Fluindapyr provides broad-spectrum activity against a wide range of destructive diseases in row and specialty crops, as well as turf.
Key Takeaways
Agrochemicals include pesticides, fertilizers, soil conditioners, plant growth regulators, etc. that increase crop yield and promote healthy plant growth.
Pesticides are the most widely used product and herbicides are the most widely used type of pesticides according to the Environmental Protection Agency (EPA) The major opportunity for this market is to completely switch from synthetic agrochemicals to bio-based products.
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Crop Protection Chemicals Market- Forecast (2022-2027)
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