Bugging Out

Navigating Latin America’s crop protection chemicals market.

The Latin American crop protection chemicals market is on an upward trajectory, driven by the region’s expansive agricultural sector. Projections indicate significant growth, with market size expected to approach USD 25 billion by 2030, spurred by compound annual growth rates of 3% to 6%. However, this growth is accompanied by challenges, including environmental concerns, regulatory complexities and public health risks associated with intensive pesticide use. 

The environmental impact of widespread pesticide application is a growing concern, with issues ranging from soil and water contamination to biodiversity loss. To address these challenges, cohesive regional approaches to pesticide management are necessary, alongside increased adoption of environmentally friendly practices.  

Argentina and Brazil stand as significant players in the agrochemical sector, with Argentina particularly excelling due to its adoption of “cutting-edge technologies and the many advances made in the local production of chemical products,” informed an agricultural producer. “To such an extent that it is one of the top 5 countries in the world in terms of agro-inputs turnover.”  

“The agrochemical sector has made an enormous effort to increase local production of its products, which today stands at approximately 80%,” reported the producer. However, concerns loom for the 2024/2025 campaign due to factors like exchange rate distortions and cereal prices, potentially leading to a 20% sales drop.  

Even so, criticism towards the pesticide sector persists, urging for advancements in environmental protection techniques. Meanwhile, the bio-pesticide market, though fragmented, holds promise for consolidation “as of 2022, more than 70 million hectares were treated with bio-pesticides,” highlighted an executive director at a Brazilian agribusiness think tank.  

“as of 2022, more than 70 million hectares were treated with bio-pesticides.”

Executive director at a Brazilian agribusiness think tank, São Paulo

Bio-pesticides are derived from natural sources like plants, bacteria and minerals and are gaining traction due to rising awareness of sustainable agriculture and stringent regulations on conventional pesticides. The agricultural producer suggested, “Some studies indicate that by 2040 or 2050 the market for bio inputs, both bio-fertilisers and bio-pesticides, could equal the market for agrochemicals.” 

Currently, the market comprises mostly small to medium-sized national companies “as, for many years, farmers in Brazil produced their own bio-pesticides as large companies favoured chemical pesticides,” surmised the think tank director. Forecasts are suggesting bio inputs could rival agrochemicals by 2040-2050. “Throughout the last five years, the Brazilian bio-pesticide market has increased by 45% and while agro-toxics have registered a 5% increase,” continued the executive director. “It is clearly a developing market, but over time it will surely consolidate,” the agricultural producer concluded. 

Regarding foreign investment, established companies like Syngenta, Bayer and local firms dominate, leaving limited room for new entrants. “It is not easy for foreign companies to enter the bio-pesticide market in Brazil, due to its complex regulatory system,” confirmed the agribusiness executive director. The producer agreed, “I wouldn’t say that there is no room for new players to enter, but I would say that almost all of them are already playing.” 

“It is not easy for foreign companies to enter the bio-pesticide market in Brazil, due to its complex regulatory system.”

Executive director at a Brazilian agribusiness think tank, São Paulo

The agricultural sector faces significant challenges due to its negative public perception, accused of endangering biodiversity and posing health risks such as cancer and toxicity. Efforts have been made to address these concerns, as “companies are aware that this is a very sensitive issue, they are also clear that it can only be improved gradually, because there is also a very sensitive issue at stake, which has been discussed and debated in many forums, such as global food safety,” retorted the agricultural producer.  

Recent reports on pesticide presence in Argentina highlight ongoing challenges. Locally, political and economic issues, such as “an increase in the tax burden, an exchange rate that often prevents investment, and the application of withholding taxes,” hinder progress. Collaboration with authorities is required to ensure sustainable development and economic growth. 

The Latin American crop protection chemicals market is poised for growth, driven by increasing demand for sustainable agriculture solutions. However, the agriculturist stated, “There is room for both [pesticides and bio-pesticides], and it is necessary to work together because some products attack one stage of the pest’s life better, and other products attack another stage.” But bio-pesticides represent a promising avenue for addressing environmental concerns while meeting the needs of an expanding agricultural sector. It’s not only game on for the major global players but also the local producers who have a relevant share of this bug-blitzing market.  

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