Leading pesticide leaders are accelerating growth through mergers and acquisitions

As the pressure on domestic environmental protection increases, barriers in the pesticide industry increase, and industry integration is accelerating, superior leaders are accelerating their growth through mergers and acquisitions
.
It is expected that in 2019, small traditional enterprises will face the possibility of being eliminated, and the market will be re-division and reshuffle.
Biopesticide (biochemical pesticide) companies that have invested a lot of environmental protection and sound environmental protection facilities in the early stage will seize the opportunity in the industry integration process
.
The boom continues to pick up in the past few years, the prices of agricultural products have been at a low level, which has affected the prosperity of the pesticide industry
.
However, the oversupply situation in the pesticide industry for many years has been reversed since the second half of 2017
.
The overall increase in pesticide prices in 2017 was 20-30%.
In 2018, the prices of some pesticide technical materials still rose sharply
.
With the gradual rise in prices of agricultural products from the bottom, the enthusiasm for the use of pesticides in agriculture is expected to increase
.
At present, the world's population continues to increase, and arable land resources are limited, so not only the demand for pesticides is strong, but the changes in demand also require the pesticide industry to continuously introduce new varieties
.
The barriers of the pesticide industry are getting higher and higher, and the continuous changes in downstream demand put forward higher requirements for pesticide companies.
The country is committed to cultivating large-scale enterprise groups to bring growth opportunities to biopesticide/biochemical pesticide companies
.
The long-term logic of the pesticide industry has not changed .
Increased industry concentration.
Under normal conditions of environmental protection, the clearance of small and medium-sized production capacity in the pesticide industry has accelerated, the industry concentration has increased significantly, and supply continues to shrink
.
On the one hand, after 2019, environmental inspections will become the norm, and supply-side reforms will be more in-depth and specific.
These factors are completely different from the phased price increases at any period in the past 10 years
.
Therefore, although the prices of some technical materials are currently close to historical highs, even if there is the possibility of a slight fall in the future, the high probability will still remain high
.
On the other hand, from the perspective of cost, environmental protection taxes will also raise the cost of pesticides, and the supplier’s mentality of reluctance to sell, stable prices, high prices, and price increases will continue.

.
According to the "Thirteenth Five-Year" development plan for the pesticide industry, the production of pesticide technical materials will be further concentrated.
By 2020, the number of pesticide technical enterprises will be reduced by 30%.
The current high profitability situation is expected to continue, and it is expected that the entire industry may increase its valuation
.
It is especially beneficial to advantageous enterprises with a high degree of industrial chain integration and self-supplied intermediates.
With the release of new safe and environmentally friendly active ingredients and preparations, their profits are expected to usher in a new round of rapid growth
.