Knowledge Paper on SAFE&JUDICIOUSUSEOFAGROCHEMICALS …ficci.in/spdocument/20377/Agro-Knowledge-paper.pdf · 2014-04-23 · Manish Panchal Practice Head - Chemical & Energy Tata Strategic

Knowledge and Strategy Partner

March, 2014

Knowledge Paper on

SAFE & JUDICIOUS USE OF AGROCHEMICALS AND APPLICATIONS OF GREEN CHEMISTRY


Sidharth BirlaPresident

Message


Sidharth BirlaPresident

Message


We deeply acknowledge the contributions of Industry leaders and experts from following

companies who have shared their experiences with us in the course of preparation of this

report.

Our sincere thanks to industry experts from:

vDow Agrosciences India Pvt. Ltd.

vMonsanto India Ltd.

vRallis India Ltd.

vDuPont India Pvt. Ltd.

Acknowledgments


Preface

Manish PanchalPractice Head - Chemical & EnergyTata Strategic Management Group

[email protected]

Charu Kapoor Engagement Manager - ChemicalsTata Strategic Management Group

[email protected]

P S Singh

[email protected]

Head- Chemicals & Petrochemicals

Federation of Indian Chambers of Commerce & Industry (FICCI) & TATA Strategic

Management Group (TSMG) have been regularly tracking the trends in the agrochemical

industry and supporting companies, both big and small, across various verticals to achieve

business excellence. The same knowledge and experience gives us an additional advantage

to realize this report.

The rising population, increasing food demand, shrinking agriculture land area and loss of

crops due to the attack of pests and diseases have made the crop protection chemicals all the

more important in today's world. However there is an increasing concern about the

detrimental effects of the crop protection chemicals on human health. Excessive and non-

judicious use of pesticides can result in several health problems. Apart from the direct

exposure to the farmers, the crop protection chemicals can indirectly impact human beings

through food consumption and inhalation. This signifies the need to educate the end users

and inspired us to help create awareness on safe and judicious use of crop protection

chemicals through this report.

The unfavorable effects of pesticides on environment are also severe as many pesticides are

non-biodegradable. If coupled with inefficient manufacturing processes, their harmful

effects are increased several fold. To avoid further damage to our eco-system, it is essential

that companies producing crop protection products evaluate possibilities to move to

"green" processes and products. Through this report we have attempted to highlight

possible strategies to implement green chemistry practices for crop protection companies.

We sincerely thank all industry leaders whose valuable inputs have helped in building this

report. As always it was an insightful experience for the team to materialize this report. We

hope it acts as a guiding light both for the players and the consumers of crop protection

products.


We deeply acknowledge the contributions of Industry leaders and experts from following

companies who have shared their experiences with us in the course of preparation of this

report.

Our sincere thanks to industry experts from:

vDow Agrosciences India Pvt. Ltd.

vMonsanto India Ltd.

vRallis India Ltd.

vDuPont India Pvt. Ltd.

Acknowledgments


Preface

Manish PanchalPractice Head - Chemical & EnergyTata Strategic Management Group

[email protected]

Charu Kapoor Engagement Manager - ChemicalsTata Strategic Management Group

[email protected]

P S Singh

[email protected]

Head- Chemicals & Petrochemicals

Federation of Indian Chambers of Commerce & Industry (FICCI) & TATA Strategic

Management Group (TSMG) have been regularly tracking the trends in the agrochemical

industry and supporting companies, both big and small, across various verticals to achieve

business excellence. The same knowledge and experience gives us an additional advantage

to realize this report.

The rising population, increasing food demand, shrinking agriculture land area and loss of

crops due to the attack of pests and diseases have made the crop protection chemicals all the

more important in today's world. However there is an increasing concern about the

detrimental effects of the crop protection chemicals on human health. Excessive and non-

judicious use of pesticides can result in several health problems. Apart from the direct

exposure to the farmers, the crop protection chemicals can indirectly impact human beings

through food consumption and inhalation. This signifies the need to educate the end users

and inspired us to help create awareness on safe and judicious use of crop protection

chemicals through this report.

The unfavorable effects of pesticides on environment are also severe as many pesticides are

non-biodegradable. If coupled with inefficient manufacturing processes, their harmful

effects are increased several fold. To avoid further damage to our eco-system, it is essential

that companies producing crop protection products evaluate possibilities to move to

"green" processes and products. Through this report we have attempted to highlight

possible strategies to implement green chemistry practices for crop protection companies.

We sincerely thank all industry leaders whose valuable inputs have helped in building this

report. As always it was an insightful experience for the team to materialize this report. We

hope it acts as a guiding light both for the players and the consumers of crop protection

products.

Knowledge and Strategy Partner Knowledge and Strategy Partner

1 Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

2 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

3 Indian market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

lIndustry structure and Competitive landscape. . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

lIndian market scenario . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

lDomestic consumption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

lDistribution of domestic crop protection market by Product category . . . . . . . . 9

lState wise distribution of crop protection market . . . . . . . . . . . . . . . . . . . . . . . . 10

lDistribution and Sales Channel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

lThe shift towards Green . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

4 Challenges faced by the Indian Crop Protection Industry . . . . . . . . . . . . . . . . . . . . 12

5 Opportunities and Growth Drivers for Indian Crop Protection Market . . . . . . . . . 14

6 Green Chemistry in Agrochemical Sector . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

lGreen Chemistry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

lGreen Chemistry Implementation Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

lShort Term Strategies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

lMedium Term Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

lLong Term Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

lJudicious use of Agrochemicals. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

7 The Way Ahead . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

8 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

9 About Tata Strategic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

lTata Strategic Contacts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

10 About FICCI. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

TABLE OF CONTENT

Knowledge and Strategy Partner Knowledge and Strategy Partner

1 Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

2 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

3 Indian market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

lIndustry structure and Competitive landscape. . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

lIndian market scenario . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

lDomestic consumption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

lDistribution of domestic crop protection market by Product category . . . . . . . . 9

lState wise distribution of crop protection market . . . . . . . . . . . . . . . . . . . . . . . . 10

lDistribution and Sales Channel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

lThe shift towards Green . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

4 Challenges faced by the Indian Crop Protection Industry . . . . . . . . . . . . . . . . . . . . 12

5 Opportunities and Growth Drivers for Indian Crop Protection Market . . . . . . . . . 14

6 Green Chemistry in Agrochemical Sector . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

lGreen Chemistry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

lGreen Chemistry Implementation Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

lShort Term Strategies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

lMedium Term Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

lLong Term Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

lJudicious use of Agrochemicals. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

7 The Way Ahead . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

8 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

9 About Tata Strategic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

lTata Strategic Contacts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

10 About FICCI. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

TABLE OF CONTENT


Figure 1: Losses caused by different pests (%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Figure 2: Indian Crop Protection Market, FY13 (USD Bn). . . . . . . . . . . . . . . . . . . . . . . . . 6

Figure 3: Key Industry players, India . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Figure 4: Per capita consumption of pesticides (Kg/ ha), FY13 . . . . . . . . . . . . . . . . . . . . 8

Figure 5: Crop protection market split, India, FY13 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Figure 6: State wise pesticides consumption, FY13 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Figure 7: Agrochemicals going off-patent, 2014-2020 (USD billion). . . . . . . . . . . . . . . . 14

Figure 8: Arable land per capita (ha) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Figure 9: Yield per hectare (million tonnes per hectare) . . . . . . . . . . . . . . . . . . . . . . . . 16

Figure 10: Green Chemistry Implementation Strategies . . . . . . . . . . . . . . . . . . . . . . . . . 17

Figure 11: Advantages of Microwave Chemistry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Figure 12: Global bio-pesticides market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Figure 13: The Way Ahead . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

FIGURE OF CONTENT

1


Executive Summary

This report is developed by Tata Strategic Management Group with support of FICCI as

the knowledge paper for the "Safer and Judicious use of Agrochemicals and applications

of Green Chemistry 2014" seminar.

The Indian crop protection industry currently stands at USD 4.1 billion and is expected to

grow at a CAGR of 12% for the next five years. Insecticides is the largest sub-segment of

agrochemicals with 60% market share whereas herbicides with 16% market share is the

fastest growing product segment in India. Andhra Pradesh, Maharashtra and Punjab are

the leading consumers of pesticides accounting for ~50% of overall consumption. Going

ahead, opportunities for the Indian crop protection industry will come in the form of

exports, growth in generic products, product portfolio expansion, and growth in

herbicides and fungicides.

However, the detrimental impact of the excessive and non-judicious pesticide

consumption on the human health and environment has become a critical issue for the

agrochemical companies and society at large. Apart from contaminating the

environment (air, water and soil), agrochemicals also adversely impact the human and

animal health through direct and indirect exposure when used improperly. The rise in

cancer affected patients in Punjab stresses that safe and judicious use of pesticides and

green chemistry manufacturing practices are the need of the hour.

Judicious use of pesticides involves using the right product at correct dosage and with

appropriate application methodology to ensure minimal impact on non-target species. It

is not only the responsibility of the government but also moral responsibility of

manufacturers' to work closely with the farmers to educate them on safe and judicious

use of pesticides.

Crop protection products manufacturers, on the other hand, should perform a process

and environmental impact audit of their existing products and adopt green chemistry

practices. In the short term companies can implement zero discharge solutions, adopt

COD reduction techniques and develop collaborative platforms. In the medium term,

companies can implement solvent recovery practice, explore alternate greener solvents,

biocatalysts and microwave chemistry technology. Over the long term, companies need


Figure 1: Losses caused by different pests (%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Figure 2: Indian Crop Protection Market, FY13 (USD Bn). . . . . . . . . . . . . . . . . . . . . . . . . 6

Figure 3: Key Industry players, India . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Figure 4: Per capita consumption of pesticides (Kg/ ha), FY13 . . . . . . . . . . . . . . . . . . . . 8

Figure 5: Crop protection market split, India, FY13 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Figure 6: State wise pesticides consumption, FY13 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Figure 7: Agrochemicals going off-patent, 2014-2020 (USD billion). . . . . . . . . . . . . . . . 14

Figure 8: Arable land per capita (ha) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Figure 9: Yield per hectare (million tonnes per hectare) . . . . . . . . . . . . . . . . . . . . . . . . 16

Figure 10: Green Chemistry Implementation Strategies . . . . . . . . . . . . . . . . . . . . . . . . . 17

Figure 11: Advantages of Microwave Chemistry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Figure 12: Global bio-pesticides market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Figure 13: The Way Ahead . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

FIGURE OF CONTENT

1


Executive Summary

This report is developed by Tata Strategic Management Group with support of FICCI as

the knowledge paper for the "Safer and Judicious use of Agrochemicals and applications

of Green Chemistry 2014" seminar.

The Indian crop protection industry currently stands at USD 4.1 billion and is expected to

grow at a CAGR of 12% for the next five years. Insecticides is the largest sub-segment of

agrochemicals with 60% market share whereas herbicides with 16% market share is the

fastest growing product segment in India. Andhra Pradesh, Maharashtra and Punjab are

the leading consumers of pesticides accounting for ~50% of overall consumption. Going

ahead, opportunities for the Indian crop protection industry will come in the form of

exports, growth in generic products, product portfolio expansion, and growth in

herbicides and fungicides.

However, the detrimental impact of the excessive and non-judicious pesticide

consumption on the human health and environment has become a critical issue for the

agrochemical companies and society at large. Apart from contaminating the

environment (air, water and soil), agrochemicals also adversely impact the human and

animal health through direct and indirect exposure when used improperly. The rise in

cancer affected patients in Punjab stresses that safe and judicious use of pesticides and

green chemistry manufacturing practices are the need of the hour.

Judicious use of pesticides involves using the right product at correct dosage and with

appropriate application methodology to ensure minimal impact on non-target species. It

is not only the responsibility of the government but also moral responsibility of

manufacturers' to work closely with the farmers to educate them on safe and judicious

use of pesticides.

Crop protection products manufacturers, on the other hand, should perform a process

and environmental impact audit of their existing products and adopt green chemistry

practices. In the short term companies can implement zero discharge solutions, adopt

COD reduction techniques and develop collaborative platforms. In the medium term,

companies can implement solvent recovery practice, explore alternate greener solvents,

biocatalysts and microwave chemistry technology. Over the long term, companies need

2


to focus on developing bio-pesticides, implement process innovation to achieve a better

material balance and build symbiotic relationships with key stake holders.

Going ahead, the agrochemical industry should focus on developing new processes and

products with sustainability as the core principle. This requires developing a collaborative

platform in which the academia, government and regulatory bodies, manufacturers and

farmers come together and promote and execute strategies for implementing judicious

use of pesticides and green chemistry strategies in the agrochemical sector.

3


Introduction

The world's population currently stands at 7 billion and is estimated to rise to 9.3 billion by 2050. This will require the global food production to be increased by 70% over the same time period in order to meet the demand. While there is a need to grow more food to meet future demand, the world currently is facing challenges of food shortage, increasing malnutrition as one seventh of world's population suffers from the same, and rising food inflation. To add to the problems, 25% to 40% of world crop output is lost due to the attack of pests, weeds and diseases. According to industry estimates, for each acre of land there are 50 to 300 million buried weeds and a crops and plants have to compete with 30,000 species of weeds, 3,000 species of nematodes and 100,000 species of plant eating insects before the crop produce can finally reach the end users. To minimize these losses and to enhance yields it is essential to use crop protection chemicals.

Crop protection doesn't just protect; it enriches as well. It increases crop productivity by 20-50%, which helps mitigate the 20-40% of crop loss from pest attacks. The industry is estimated to reduce overall potential pre-harvest wheat loss of 50% to an actual loss of 29%. Some 20% of the entire world's agricultural production would be lost to post-harvest pest attacks if it were not for crop protection chemicals. The result is that crop protection makes excellent financial sense; farmers get back 14.5 their investments in agrochemicals, which allows them to invest in seeds and on other farming implements to grow more and better crops.

Figure 1 Losses caused by different pests (%)

Weeds, 33%

Insects, 26%

Diseases, 26%

Rodents, 6%

Others, 8%

Source: Industry Reports, Analysis by Tata Strategic

2


to focus on developing bio-pesticides, implement process innovation to achieve a better

material balance and build symbiotic relationships with key stake holders.

Going ahead, the agrochemical industry should focus on developing new processes and

products with sustainability as the core principle. This requires developing a collaborative

platform in which the academia, government and regulatory bodies, manufacturers and

farmers come together and promote and execute strategies for implementing judicious

use of pesticides and green chemistry strategies in the agrochemical sector.

3


Introduction

The world's population currently stands at 7 billion and is estimated to rise to 9.3 billion by 2050. This will require the global food production to be increased by 70% over the same time period in order to meet the demand. While there is a need to grow more food to meet future demand, the world currently is facing challenges of food shortage, increasing malnutrition as one seventh of world's population suffers from the same, and rising food inflation. To add to the problems, 25% to 40% of world crop output is lost due to the attack of pests, weeds and diseases. According to industry estimates, for each acre of land there are 50 to 300 million buried weeds and a crops and plants have to compete with 30,000 species of weeds, 3,000 species of nematodes and 100,000 species of plant eating insects before the crop produce can finally reach the end users. To minimize these losses and to enhance yields it is essential to use crop protection chemicals.

Crop protection doesn't just protect; it enriches as well. It increases crop productivity by 20-50%, which helps mitigate the 20-40% of crop loss from pest attacks. The industry is estimated to reduce overall potential pre-harvest wheat loss of 50% to an actual loss of 29%. Some 20% of the entire world's agricultural production would be lost to post-harvest pest attacks if it were not for crop protection chemicals. The result is that crop protection makes excellent financial sense; farmers get back 14.5 their investments in agrochemicals, which allows them to invest in seeds and on other farming implements to grow more and better crops.

Figure 1 Losses caused by different pests (%)

Weeds, 33%

Insects, 26%

Diseases, 26%

Rodents, 6%

Others, 8%

Source: Industry Reports, Analysis by Tata Strategic

4


Traditionally, agrochemicals have been manufactured through chemical synthesis but

lately biochemical processes are gaining popularity. Usually, agrochemicals involves

active ingredient in a definite concentration along with adjuvants which enhance their

performance, safety and usability. The agrochemicals are diluted in recommended doses

and applied on seeds, soil, irrigation water and crops to prevent the damages from pests,

weeds and diseases.

The crop protection chemicals can be broadly classified into five types:

1.1. Insecticides: Insecticides provide protection to the crops from the insects by either

killing them or by preventing their attack. They help in controlling the pest

population below a desired threshold level.

1.2. Fungicides: Fungicides protect the crops from the attack of fungi and can beof two

types - protectants and eradicants. Protectants prevent or inhibit fungal growth and

eradicantskill the pests on application.

1.3. Herbicides: Herbicidesalso called as weedicides are used to kill undesirable plants.

They can be of two types - selective and non-selective.

1.4. Bio-pesticides: Bio-pesticides are new age crop protection products manufactured

from natural substances like plants, animals, bacteria and certain minerals.They are

eco-friendly, easy to use; require lower dosage amounts for same performance as

compared to chemical based pesticides.

1.5. Others (Fumigants, Rodenticides, Plant growth regulators etc.): Fumigants and

rodenticides are the chemicals which protect the crops from pest attacksduring

crop storage. Plant growth regulators help in controlling or modifying the plant

growth process and are usually used in cotton, rice and fruits.

Despite their significant benefits, many of the chemically synthesized agrochemicals are

harmful to the environment as they are non-biodegradable and are produced by

environmentally unfriendly processes. They also affect human and animal health due to

bioaccumulation by entering through the food chain. Direct exposure to agrochemicals

during cropping and agriculture activities and indirect exposure through food

consumption and inhalation can lead to adverse health effects like injury to nervous

system, lung damage, birth defects, endocrine disorders and cancer. It is estimated that

today, in India, approx. 50% of the food commodities are contaminated with pesticide

residues.

5


Therefore, to successfully reap the benefits of crop protection products without

compromising the environment and human health, going forward, it is essential that

producers and users of crop protection products to focus the following elements:

1. Shift to green chemistry manufacturing processes

2. Develop "green" agrochemicals

3. Usecrop protection products judiciously

The following sections of the report highlight the Indian crop protection market, the

opportunities and challenges of the sector, green chemistry implementation strategies

for companies and recommendations on judicious use of crop protection products.

4


Traditionally, agrochemicals have been manufactured through chemical synthesis but

lately biochemical processes are gaining popularity. Usually, agrochemicals involves

active ingredient in a definite concentration along with adjuvants which enhance their

performance, safety and usability. The agrochemicals are diluted in recommended doses

and applied on seeds, soil, irrigation water and crops to prevent the damages from pests,

weeds and diseases.

The crop protection chemicals can be broadly classified into five types:

1.1. Insecticides: Insecticides provide protection to the crops from the insects by either

killing them or by preventing their attack. They help in controlling the pest

population below a desired threshold level.

1.2. Fungicides: Fungicides protect the crops from the attack of fungi and can beof two

types - protectants and eradicants. Protectants prevent or inhibit fungal growth and

eradicantskill the pests on application.

1.3. Herbicides: Herbicidesalso called as weedicides are used to kill undesirable plants.

They can be of two types - selective and non-selective.

1.4. Bio-pesticides: Bio-pesticides are new age crop protection products manufactured

from natural substances like plants, animals, bacteria and certain minerals.They are

eco-friendly, easy to use; require lower dosage amounts for same performance as

compared to chemical based pesticides.

1.5. Others (Fumigants, Rodenticides, Plant growth regulators etc.): Fumigants and

rodenticides are the chemicals which protect the crops from pest attacksduring

crop storage. Plant growth regulators help in controlling or modifying the plant

growth process and are usually used in cotton, rice and fruits.

Despite their significant benefits, many of the chemically synthesized agrochemicals are

harmful to the environment as they are non-biodegradable and are produced by

environmentally unfriendly processes. They also affect human and animal health due to

bioaccumulation by entering through the food chain. Direct exposure to agrochemicals

during cropping and agriculture activities and indirect exposure through food

consumption and inhalation can lead to adverse health effects like injury to nervous

system, lung damage, birth defects, endocrine disorders and cancer. It is estimated that

today, in India, approx. 50% of the food commodities are contaminated with pesticide

residues.

5


Therefore, to successfully reap the benefits of crop protection products without

compromising the environment and human health, going forward, it is essential that

producers and users of crop protection products to focus the following elements:

1. Shift to green chemistry manufacturing processes

2. Develop "green" agrochemicals

3. Usecrop protection products judiciously

The following sections of the report highlight the Indian crop protection market, the

opportunities and challenges of the sector, green chemistry implementation strategies

for companies and recommendations on judicious use of crop protection products.

6


Indian market overview

The Indian crop protection industry is estimated to be USD 4.1 billion in FY13 and is

expected to to grow at a CAGR of 12% to reach USD 7.1 billion by FY18. The exports

currently constitute almost 50% of the Indian crop protection industry and are expected

to grow at a CAGR of 16% to reach USD 4.2 billion by FY18, resulting in 60% share in Indian

crop protection industry. Domestic market on the other hand would however grow at 8%

CAGR, as it is predominantly monsoon dependent, to reach USD 2.9 billion by FY18. India

is the fourth largest producer of crop protection chemicals globally, after United States,

Japan & China.The crop protection companies in India can be categorized into three

types -Multi-National, Indian including the public sector companies and small sector

units.

Figure 2 Indian Crop Protection Industry (USD Billion)

Domestic

Exports

Total

Source: Industry reports, Analysis by Tata Strategic

FY13 FY18

12%

USD 4.1 billion

USD 7.1 billion

16%

8%

2.0

2.9

4.2

2.1

7


Industry structure and Competitive landscape

The Indian crop protection industry is dominated by the generic products with more than

80% of the non- patented molecules. This results in very low entry barriers for the industry.

Strong distribution network, appropriate pricing, brand recall and dealer margins are

some of the critical factors for the companies to succeed. Crop protection chemicals are

manufactured as technical grades and converted into formulations for agricultural use.

Technical grade manufacturers, formulators producing the end products, distributors

and end use customers constitute the Indian crop protection market. According to

Pesticide Monitoring Unit, GOI, there are about 125 technical grade manufacturers,

including about 10 multinationals, more than 800 formulatorsand over 145,000

distributors in India.More than60 technical grade pesticides are being manufactured

indigenously.

Technical grade manufacturers sell high purity chemicals in bulk (generally in drums of

200-250 kgs.) to formulators. Formulatorsprepare the formulations by adding inert

carriers, solvents, surface active agents, etc. These formulations are then packed for

retail sale, supplied to the distributors and finally sold to the end use customers (farmers).

With over 800 formulators the Indian crop protection market is a highly fragmented market. The market has been seena number mergers and acquisitions with large players

buying out small manufacturers. Companies are also looking for strategic alliances and

partnerships in order to expand their market reach.

The leading market players are United Phosphorus Ltd, Rallis India Ltd, Bayer Cropscience

Ltd, Gharda Chemicals Ltd, Syngenta India Ltd, BASF India Ltd, Dow AgroSciences, etc.

Top ten companies control almost 75-80% of the market share. The market share of large

players depends primarily on product portfolio and introduction of new molecules.

Technical grade manufacturers

(~125)

Formulators(~800)

Distributors(~145,000)

End use customers

6


Indian market overview

The Indian crop protection industry is estimated to be USD 4.1 billion in FY13 and is

expected to to grow at a CAGR of 12% to reach USD 7.1 billion by FY18. The exports

currently constitute almost 50% of the Indian crop protection industry and are expected

to grow at a CAGR of 16% to reach USD 4.2 billion by FY18, resulting in 60% share in Indian

crop protection industry. Domestic market on the other hand would however grow at 8%

CAGR, as it is predominantly monsoon dependent, to reach USD 2.9 billion by FY18. India

is the fourth largest producer of crop protection chemicals globally, after United States,

Japan & China.The crop protection companies in India can be categorized into three

types -Multi-National, Indian including the public sector companies and small sector

units.

Figure 2 Indian Crop Protection Industry (USD Billion)

Domestic

Exports

Total


FY13 FY18

12%

USD 4.1 billion

USD 7.1 billion

16%

8%

2.0

2.9

4.2

2.1

7


Industry structure and Competitive landscape

The Indian crop protection industry is dominated by the generic products with more than

80% of the non- patented molecules. This results in very low entry barriers for the industry.

Strong distribution network, appropriate pricing, brand recall and dealer margins are

some of the critical factors for the companies to succeed. Crop protection chemicals are

manufactured as technical grades and converted into formulations for agricultural use.

Technical grade manufacturers, formulators producing the end products, distributors

and end use customers constitute the Indian crop protection market. According to

Pesticide Monitoring Unit, GOI, there are about 125 technical grade manufacturers,

including about 10 multinationals, more than 800 formulatorsand over 145,000

distributors in India.More than60 technical grade pesticides are being manufactured

indigenously.

Technical grade manufacturers sell high purity chemicals in bulk (generally in drums of

200-250 kgs.) to formulators. Formulatorsprepare the formulations by adding inert

carriers, solvents, surface active agents, etc. These formulations are then packed for

retail sale, supplied to the distributors and finally sold to the end use customers (farmers).

With over 800 formulators the Indian crop protection market is a highly fragmented market. The market has been seena number mergers and acquisitions with large players

buying out small manufacturers. Companies are also looking for strategic alliances and

partnerships in order to expand their market reach.

The leading market players are United Phosphorus Ltd, Rallis India Ltd, Bayer Cropscience

Ltd, Gharda Chemicals Ltd, Syngenta India Ltd, BASF India Ltd, Dow AgroSciences, etc.

Top ten companies control almost 75-80% of the market share. The market share of large

players depends primarily on product portfolio and introduction of new molecules.

Technical grade manufacturers

(~125)

Formulators(~800)

Distributors(~145,000)

End use customers

8


Presence of key industry participants across product segments

Company Insecticides Herbicides Fungicides Others

BASF India ü - ü Seed treatment

Bayer Crop science Ltd ü ü ü Seed treatment, plant growth regulators

Dhanuka Agritech Limited ü ü ü PGRs, Surfactants

Dow AgroSciences India Pvt. Ltd. ü ü ü Plant Growth Regulator

DuPont ü ü ü Growth Enhancer

Excel Crop Care Limited ü ü ü Seed treatment, Home & Garden

Gharda Chemicals Ltd. ü ü ü Plant growth Regulator

Meghmani Organics Limited ü ü ü Pesticide Intermediates

Monsanto India Ltd. - ü - Maize seeds

Nagarjuna Agrichem Limited ü ü ü Fertilizers, Micro Nutrients, Liquid Fertilizers,

PI Industries Ltd ü ü ü Speciality Products

Rallis India ü ü ü Rodenticides, Seed treatment

Syngenta India ü ü ü Seed treatment

United Phosphorous Limited ü ü ü Fumigants, Rodenticides

Indian market scenario

3.1.1 Domestic consumption

The per capita consumption of crop protection products in India is amongst the lowest in

the world. Currently the per capita consumption of pesticides in India stands at 0.6 kg/ha

as compared to 5 kg/ha in UK and 7 kg/ha in USA. On the other hand the per capita

consumption in other Asian countries like Japan, China and Taiwan is almost 50 times as

compared to the Indian consumption. Low purchasing power of farmers, lack of

awareness amongst them and limited reach are some of the reasons for low consumption

of pesticides in India, thus creating tremendous opportunity for the growth of crop

protection industry in India.

Figure 4: Per capita consumption of pesticides (Kg/ ha), FY13

Figure 3: Key Industry players, India

India UK France Korea USA Japan China Taiwan

0.6

5 5

7 7

1213

17


9


3.1.2 Distribution of domestic crop protection market by Product category

The Indian crop protection market is dominated by the Insecticides which form almost

60% of the domestic crop protection chemicals market. The major applications are found

in rice and cotton crops. Fungicides and Herbicides are the largest growing segments

accounting for 18% and 16% respectively of the total crop protection chemicals market.As

the weeds grow in damp and warm weather and die in cold seasons, the sale of herbicides

is seasonal. Rice and wheat crops are the major application areas of herbicides. Increasing

labor costs and shortage are the key growth drivers for the herbicides. The fungicides find

applications in fruits, vegetables and rise and their increasing usage is due to shift in

agriculture from cash crops to fruits and vegetables and government support for

exports. Biopesticides include all biological materials organisms, which can be used to

control pests. Although they constitute only 3% of the Indian crop protection market, they

provide significant growth opportunities due to increasing concern of safety and toxicity

of pesticides, stringent regulations and government support.

Figure 5: Crop protection market split, India, FY13

Herbicides, 16%

Biopesticides, 3%

Fungicides, 18%

Others, 3%

Insecticides, 60%


8


Presence of key industry participants across product segments

Company Insecticides Herbicides Fungicides Others

BASF India ü - ü Seed treatment

Bayer Crop science Ltd ü ü ü Seed treatment, plant growth regulators

Dhanuka Agritech Limited ü ü ü PGRs, Surfactants

Dow AgroSciences India Pvt. Ltd. ü ü ü Plant Growth Regulator

DuPont ü ü ü Growth Enhancer

Excel Crop Care Limited ü ü ü Seed treatment, Home & Garden

Gharda Chemicals Ltd. ü ü ü Plant growth Regulator

Meghmani Organics Limited ü ü ü Pesticide Intermediates

Monsanto India Ltd. - ü - Maize seeds

Nagarjuna Agrichem Limited ü ü ü Fertilizers, Micro Nutrients, Liquid Fertilizers,

PI Industries Ltd ü ü ü Speciality Products

Rallis India ü ü ü Rodenticides, Seed treatment

Syngenta India ü ü ü Seed treatment

United Phosphorous Limited ü ü ü Fumigants, Rodenticides

Indian market scenario

3.1.1 Domestic consumption

The per capita consumption of crop protection products in India is amongst the lowest in

the world. Currently the per capita consumption of pesticides in India stands at 0.6 kg/ha

as compared to 5 kg/ha in UK and 7 kg/ha in USA. On the other hand the per capita

consumption in other Asian countries like Japan, China and Taiwan is almost 50 times as

compared to the Indian consumption. Low purchasing power of farmers, lack of

awareness amongst them and limited reach are some of the reasons for low consumption

of pesticides in India, thus creating tremendous opportunity for the growth of crop

protection industry in India.

Figure 4: Per capita consumption of pesticides (Kg/ ha), FY13

Figure 3: Key Industry players, India

India UK France Korea USA Japan China Taiwan

0.6

5 5

7 7

1213

17


9


3.1.2 Distribution of domestic crop protection market by Product category

The Indian crop protection market is dominated by the Insecticides which form almost

60% of the domestic crop protection chemicals market. The major applications are found

in rice and cotton crops. Fungicides and Herbicides are the largest growing segments

accounting for 18% and 16% respectively of the total crop protection chemicals market.As

the weeds grow in damp and warm weather and die in cold seasons, the sale of herbicides

is seasonal. Rice and wheat crops are the major application areas of herbicides. Increasing

labor costs and shortage are the key growth drivers for the herbicides. The fungicides find

applications in fruits, vegetables and rise and their increasing usage is due to shift in

agriculture from cash crops to fruits and vegetables and government support for

exports. Biopesticides include all biological materials organisms, which can be used to

control pests. Although they constitute only 3% of the Indian crop protection market, they

provide significant growth opportunities due to increasing concern of safety and toxicity

of pesticides, stringent regulations and government support.

Figure 5: Crop protection market split, India, FY13

Herbicides, 16%

Biopesticides, 3%

Fungicides, 18%

Others, 3%

Insecticides, 60%


10


3.1.3 State wise distribution of crop protection market

Andhra Pradesh, Maharashtra and Punjab are the top three states contributing to 50% of

the pesticide consumption in India. Andhra Pradesh is the leading consumer with 24%

share. The top seven states together account for more than 70% of the crop protection

chemicals usage in India.

3.1.4 Distribution and Sales Channel

The sales of crop protection chemicals are predominantly in rural areas. Thereforelarge

manufacturers with all India presence use a three-tier sales and distribution network

comprising distributors, wholesalers and retailers for wider market reach. On the other

hand, regional participants cater only to the local markets.

Segment Major Products Main Applications

Insecticides Acephate, Monocrotophos, Cypermethrin Cotton, Rice

Fungicides Mancozeb, Copper Oxychloride, Ziram Fruits, Vegetables, Rice

Herbicides Glyphosate, Isoproturan, 2,4-D Rice, Wheat

Bio-pesticides Spinosyns, neem based Rice, Maize, Tobacco

Others Zinc Phosphide, Aluminum Phosphide Stored produce


State wise pesticides consumption, FY13

AP, 24%

Maharashtra,13%

Punjab, 11%Gujarat, 7%

MP &Chattisgarh, 8%

TamilNadu, 5%

Haryana, 5%

Others, 15%

WestBengal, 5%

Karnataka, 7 %

11


Companies with PAN India presence have 400-1000 distributors supplying to 25,000-

30,000 retailers. Socks are kept in warehouses or depots from where they are supplied to

distributors. Sometimes MNCs go for co-marketing and co-distribution alliance with

Indian companies to expand their reach. For example, Syngenta entered into an

agreement with Rallis for marketing of its products in India. The mid-size and small scale

companies operate through direct marketing of their products. Most companies also

perform field demonstrations to increase farmer awareness and promote their products.

3.1.5 The shift towards Green

The Indian Agrochemical Industry is witnessing a gradual shift towards implementation

of green practices. Companies have started employing zero discharge solutions in

practice which has resulted in significant benefits. For instance, a leading global company

at its Gujarat plant was able to recover more than 80% of water, reduce COD levels by 40

times and TDS levels by 60 times by implementation of zero discharge solutions. This

helped the company to comply with governmental norms, avoid liability costs, achieve

un-interrupted production and reduce production costs. Companies are gradually

replacing red triangle products with green triangle and blue triangle products. Water

based formulations, low dose molecules, target specific molecules instead of broad

spectrum chemicals and bio-pesticides are gradually getting prominence. Companies are

also focusing on educating the farmers on appropriate use of pesticides. Some of the

companies have also introduced reverse logistics through which unused packaging and

products are procured back resulting in safer disposal of the products.

Crop Protection distribution network

Technical Grade manufacutures

Formulators

Distributors

Retailers End users

Retailers/Dealers Distributors

Retailers

In-house formulators

Source: nalysis Tata Strategic a

10


3.1.3 State wise distribution of crop protection market

Andhra Pradesh, Maharashtra and Punjab are the top three states contributing to 50% of

the pesticide consumption in India. Andhra Pradesh is the leading consumer with 24%

share. The top seven states together account for more than 70% of the crop protection

chemicals usage in India.

3.1.4 Distribution and Sales Channel

The sales of crop protection chemicals are predominantly in rural areas. Thereforelarge

manufacturers with all India presence use a three-tier sales and distribution network

comprising distributors, wholesalers and retailers for wider market reach. On the other

hand, regional participants cater only to the local markets.

Segment Major Products Main Applications

Insecticides Acephate, Monocrotophos, Cypermethrin Cotton, Rice

Fungicides Mancozeb, Copper Oxychloride, Ziram Fruits, Vegetables, Rice

Herbicides Glyphosate, Isoproturan, 2,4-D Rice, Wheat

Bio-pesticides Spinosyns, neem based Rice, Maize, Tobacco

Others Zinc Phosphide, Aluminum Phosphide Stored produce


State wise pesticides consumption, FY13

AP, 24%

Maharashtra,13%

Punjab, 11%Gujarat, 7%

MP &Chattisgarh, 8%

TamilNadu, 5%

Haryana, 5%

Others, 15%

WestBengal, 5%

Karnataka, 7 %

11


Companies with PAN India presence have 400-1000 distributors supplying to 25,000-

30,000 retailers. Socks are kept in warehouses or depots from where they are supplied to

distributors. Sometimes MNCs go for co-marketing and co-distribution alliance with

Indian companies to expand their reach. For example, Syngenta entered into an

agreement with Rallis for marketing of its products in India. The mid-size and small scale

companies operate through direct marketing of their products. Most companies also

perform field demonstrations to increase farmer awareness and promote their products.

3.1.5 The shift towards Green

The Indian Agrochemical Industry is witnessing a gradual shift towards implementation

of green practices. Companies have started employing zero discharge solutions in

practice which has resulted in significant benefits. For instance, a leading global company

at its Gujarat plant was able to recover more than 80% of water, reduce COD levels by 40

times and TDS levels by 60 times by implementation of zero discharge solutions. This

helped the company to comply with governmental norms, avoid liability costs, achieve

un-interrupted production and reduce production costs. Companies are gradually

replacing red triangle products with green triangle and blue triangle products. Water

based formulations, low dose molecules, target specific molecules instead of broad

spectrum chemicals and bio-pesticides are gradually getting prominence. Companies are

also focusing on educating the farmers on appropriate use of pesticides. Some of the

companies have also introduced reverse logistics through which unused packaging and

products are procured back resulting in safer disposal of the products.

Crop Protection distribution network

Technical Grade manufacutures

Formulators

Distributors

Retailers End users

Retailers/Dealers Distributors

Retailers

In-house formulators

Source: nalysis Tata Strategic a

12


Challenges faced by the Indian Crop Protection Industry

l

l

l

l

Stringent regulations: Stringent environment regulations across the world are

increasing the cost of developing new products and simultaneously delaying the

introduction of new products in the market. For instance, in the European Union any

agrochemical product if found to be mutagenic, carcinogenic or endocrine disruptor

would not achieve registration or re-registration irrespective of the level of exposure

generated. It takes almost nine to ten years to bring a new product.

Low focus on R&D by domestic manufacturers due to high costs: The industry is

facing a serious challenge owing to the rising R&D costs. It takes almost USD 250

million in research and development to introduce a new product in the market. This

prevents the companies to invest in R&D activities and focus more on the generic

products which require low investments in research and development.

Lack of education and awareness among farmers:It is important to educate the

farmers about the appropriate kind of pesticide, its dosage and quantity and

application frequency. However it is not easy to reach the farmers owing to

infrastructure issues, regional languages and dialects. The main point of contact

between the farmers and the manufacturers are the retailers who don't have much

of a technical experience and are unable to provide a proper product understanding

to the farmers. It is also very difficult for the farmers to convey their needs effectively

to the manufacturers.

Need for efficient distribution systems:The large number of end users and the market

being predominantly generic in nature makes a strong and efficient distribution

network essential for the crop protection market. However, the industry is facing

problems due to supply chain inefficiencies and inadequate infrastructure (for e.g. -

lack of adequate cold storage facilities) which results in post-harvest losses

estimated at INR 45,000 crore every year, thereby impacting the farmers. The lack of

efficient distribution system also makes it difficult for the agrochemical companies to

reach the farmers to promote their products and educate them about their usage and

benefits.

13


l

l

Spurious products: There is a significant share of spurious pesticides and spiked bio-

pesticides. According to industry estimates the spurious and substandard pesticides

accounted for 40% of the pesticides sold in India in FY13. These products are inferior

formulations which are unable to kill the pests. They also inflict damage on the crops

resulting in output losses.

Long gestation period: It takes almost 10 years to bring a new molecule into the

market. Even for the generic products it can take up to 5 years to get the product

registered. The regulatory bodies do not have adequate resources and infrastructure

to execute timely registration of products. The rules are also not clear and are left to

the regulatory bodies for their interpretations, leading to confusions thereby adding

to the complexities for the crop protection chemical companies.

12


Challenges faced by the Indian Crop Protection Industry

l

l

l

l

Stringent regulations: Stringent environment regulations across the world are

increasing the cost of developing new products and simultaneously delaying the

introduction of new products in the market. For instance, in the European Union any

agrochemical product if found to be mutagenic, carcinogenic or endocrine disruptor

would not achieve registration or re-registration irrespective of the level of exposure

generated. It takes almost nine to ten years to bring a new product.

Low focus on R&D by domestic manufacturers due to high costs: The industry is

facing a serious challenge owing to the rising R&D costs. It takes almost USD 250

million in research and development to introduce a new product in the market. This

prevents the companies to invest in R&D activities and focus more on the generic

products which require low investments in research and development.

Lack of education and awareness among farmers:It is important to educate the

farmers about the appropriate kind of pesticide, its dosage and quantity and

application frequency. However it is not easy to reach the farmers owing to

infrastructure issues, regional languages and dialects. The main point of contact

between the farmers and the manufacturers are the retailers who don't have much

of a technical experience and are unable to provide a proper product understanding

to the farmers. It is also very difficult for the farmers to convey their needs effectively

to the manufacturers.

Need for efficient distribution systems:The large number of end users and the market

being predominantly generic in nature makes a strong and efficient distribution

network essential for the crop protection market. However, the industry is facing

problems due to supply chain inefficiencies and inadequate infrastructure (for e.g. -

lack of adequate cold storage facilities) which results in post-harvest losses

estimated at INR 45,000 crore every year, thereby impacting the farmers. The lack of

efficient distribution system also makes it difficult for the agrochemical companies to

reach the farmers to promote their products and educate them about their usage and

benefits.

13


l

l

Spurious products: There is a significant share of spurious pesticides and spiked bio-

pesticides. According to industry estimates the spurious and substandard pesticides

accounted for 40% of the pesticides sold in India in FY13. These products are inferior

formulations which are unable to kill the pests. They also inflict damage on the crops

resulting in output losses.

Long gestation period: It takes almost 10 years to bring a new molecule into the

market. Even for the generic products it can take up to 5 years to get the product

registered. The regulatory bodies do not have adequate resources and infrastructure

to execute timely registration of products. The rules are also not clear and are left to

the regulatory bodies for their interpretations, leading to confusions thereby adding

to the complexities for the crop protection chemical companies.

14


Opportunities and Growth Drivers for Indian Crop Protection Market

l

l

Export Opportunities: The export of pesticides from India hasseen a strong growth

over the last few years.India's capability in low cost manufacturing, availability of

technically trained manpower, seasonal domestic demand, overcapacity

(Production capacity of 1,50,00 MT against production of 85,000 MT in FY13), better

price realization globally and strong presence in generic pesticide manufacturing

(India has process technologies for more than 60 generic molecules) are the reasons

for growing exports of crop protection chemicals from India. Post Tsunami Japanese

companies are trying to build manufacturing capacities outside Japan to derisk

themselves. The Japanese companies are highly particular about confidentiality and

intellectual property protection and have greater faith in India as compared to China.

Globally, India is the thirteenth largest exporter of pesticides. Most of the exports are

off-patent products. The major exports from India happen to America, Asia

(excluding Middle East) and Europe. However, complex registration procedures

pose a major challenge for the Indian crop protection chemicals export.

Growth in generic products: During the period of 2013 - 2020 products worth USD 6.3

billion are expected to go off-patent providing opportunities for the Indian generic

product manufacturers organic growth opportunities and expand their market

presence.

1.3

0.9

1.2

1.6

0.4

0.7

0.2

2014 2015 2016 2017 2018 2019 2020

Figure 7 Agrochemicals going off-patent, 2014-2020 (USD billion)


15


l

l

l

Product portfolio expansion: Companies are looking to provide a complete end to end solution to the farmers right from land preparation, availability of right quality of seeds and crop protection chemicals to the buyback of used products. Portfolio expansion can not only create a better reach with the farmers but will also turn threats like genetically modified seeds, organic farming etc. into opportunities. For instance, Rallis India supports 2.5 lakh pulses farmers on best farming techniques in Maharashtra and Tamil Nadu, which has helped them to increase the yield by 15-25%. Rallis is planning to increase its coverage from three to eight districts in Maharashtra, which would provide it an opportunity to double its farmer reach and sell its products. Under Rallis' 'Grow more pulses program' the farmers get subsides from the state government if they buy seeds and other inputs supplied by the company.The farmers also get a subsidy from the state government. Rallis also buys back the pulses from farmers and retails them as unpolished dal through Tata Chemicals. By supporting the farmers, Rallis is not only helping in increasing the yield of pulses but also increase its reach and presence amongst the farmers.

Growth in herbicides and fungicides: Labor shortage, rising labor costs and growth in GM crops has led to growth in the use of herbicides. The herbicide consumption in India currently stands at 0.3 USD billion and is expected to grow at a CAGR of 15% over the next five years to reach 0.6 USD billion by FY18. On the other hand the fungicide industry in India has grown due to the growth in Indian horticulture industry, which has grown at a CAGR of 7.5% over the last five years.

Increasing demand for food grains and limited agricultural land availability: India has 16% of the world's population and less than 2% of the total landmass. India has almost 190 million hectares of gross cultivated area and there are limited options of bringing new areas under cultivation. Rapidly growing urbanization is also reducing the land availability for cultivation. The availability of agricultural land per capita has been reducing globally and is expected to reduce further. Thus the focus is to increase the yield per unit area under cultivation resulting in increased usage of agrochemicals.

Figure 8: Arable land per capita (ha)

0.460.44 0.42 0.41

0.240.22

0.19 0.18

0.18 0.17 0.15 0.14

Developed countries

World

Developing countries


2010 2015 2030 2050

14


Opportunities and Growth Drivers for Indian Crop Protection Market

l

l

Export Opportunities: The export of pesticides from India hasseen a strong growth

over the last few years.India's capability in low cost manufacturing, availability of

technically trained manpower, seasonal domestic demand, overcapacity

(Production capacity of 1,50,00 MT against production of 85,000 MT in FY13), better

price realization globally and strong presence in generic pesticide manufacturing

(India has process technologies for more than 60 generic molecules) are the reasons

for growing exports of crop protection chemicals from India. Post Tsunami Japanese

companies are trying to build manufacturing capacities outside Japan to derisk

themselves. The Japanese companies are highly particular about confidentiality and

intellectual property protection and have greater faith in India as compared to China.

Globally, India is the thirteenth largest exporter of pesticides. Most of the exports are

off-patent products. The major exports from India happen to America, Asia

(excluding Middle East) and Europe. However, complex registration procedures

pose a major challenge for the Indian crop protection chemicals export.

Growth in generic products: During the period of 2013 - 2020 products worth USD 6.3

billion are expected to go off-patent providing opportunities for the Indian generic

product manufacturers organic growth opportunities and expand their market

presence.

1.3

0.9

1.2

1.6

0.4

0.7

0.2

2014 2015 2016 2017 2018 2019 2020

Figure 7 Agrochemicals going off-patent, 2014-2020 (USD billion)


15


l

l

l

Product portfolio expansion: Companies are looking to provide a complete end to end solution to the farmers right from land preparation, availability of right quality of seeds and crop protection chemicals to the buyback of used products. Portfolio expansion can not only create a better reach with the farmers but will also turn threats like genetically modified seeds, organic farming etc. into opportunities. For instance, Rallis India supports 2.5 lakh pulses farmers on best farming techniques in Maharashtra and Tamil Nadu, which has helped them to increase the yield by 15-25%. Rallis is planning to increase its coverage from three to eight districts in Maharashtra, which would provide it an opportunity to double its farmer reach and sell its products. Under Rallis' 'Grow more pulses program' the farmers get subsides from the state government if they buy seeds and other inputs supplied by the company.The farmers also get a subsidy from the state government. Rallis also buys back the pulses from farmers and retails them as unpolished dal through Tata Chemicals. By supporting the farmers, Rallis is not only helping in increasing the yield of pulses but also increase its reach and presence amongst the farmers.

Growth in herbicides and fungicides: Labor shortage, rising labor costs and growth in GM crops has led to growth in the use of herbicides. The herbicide consumption in India currently stands at 0.3 USD billion and is expected to grow at a CAGR of 15% over the next five years to reach 0.6 USD billion by FY18. On the other hand the fungicide industry in India has grown due to the growth in Indian horticulture industry, which has grown at a CAGR of 7.5% over the last five years.

Increasing demand for food grains and limited agricultural land availability: India has 16% of the world's population and less than 2% of the total landmass. India has almost 190 million hectares of gross cultivated area and there are limited options of bringing new areas under cultivation. Rapidly growing urbanization is also reducing the land availability for cultivation. The availability of agricultural land per capita has been reducing globally and is expected to reduce further. Thus the focus is to increase the yield per unit area under cultivation resulting in increased usage of agrochemicals.

Figure 8: Arable land per capita (ha)

0.460.44 0.42 0.41

0.240.22

0.19 0.18

0.18 0.17 0.15 0.14

Developed countries

World

Developing countries


2010 2015 2030 2050

16


lLow crop yields: The yield per hectare in India is amongst the lowest in the world, 2.9

million tonnes per hectare as compared to the global average of 4 million tonnes per

hectare. This provides opportunities for the agrochemical sector as increased usage

of pesticides could help the farmers to improve the crop productivity.

Figure 9: Yield per hectare (million tonnes per hectare)

l

l

Rural Infrastructure and IT: Linking the production areas with the market would help

in easy distribution of pesticides. IT services would help create awareness among

farmers and educate them for optimum use of crop protection chemicals.

Availability of credit facilities: Govt. initiatives to provide credit facilities to farmers in

the rural areas will provide boost to the agriculture industry. Access to finance would

encourage them to use more pesticides in order to improve the crop yield.


9.89

7.3 7 7 7 6.65.2

4.3 4 3.8 3.3 3 2.9

Belgium

NetherlandsFrance

Germany

UK USAChin

a

Indonesia

BangladeshBraz

il

Srilank

a

Thailand

Pakistan

India

17


Green Chemistry in Agrochemical Sector

Green Chemistry

Green Chemistry Implementation Strategies

Green chemistry is a philosophy of chemical research and engineering that involves the

design of products and processes that minimize the use and generation of hazardous

chemicals. Unlike the environmental chemistry which focuses on the study of pollutant

chemicals and their effect on nature, green chemistry aims to reduce the pollution at the

source. Green chemistry involves waste minimization at source, use of catalysts in place

of reagents, use of non-toxic reagents, use of renewable resources, improved atom

efficiency and use of Solvent Free or Recyclable Environmentally Benign Solvent

systems.

Implementation of Green Chemistry practices can help the companies in achieving

material and energy efficiency and reduce the hazards involved in the entire life cycle of

the product.

Based on the implementation time, resources involved and associated implementation

risks green chemistry strategies can be categorized into three types: Short term

implementation strategies, medium term implementation strategies and long term

implementation strategies

Strategy Implementation Time Resources Required Associated Risks

Short Term 6 months to 18 months Low Low

Medium Term 18 months to 3 years Medium Medium

Long Term 3 years to 10 years High High

Figure 10: Green Chemistry Implementation Strategies

16


lLow crop yields: The yield per hectare in India is amongst the lowest in the world, 2.9

million tonnes per hectare as compared to the global average of 4 million tonnes per

hectare. This provides opportunities for the agrochemical sector as increased usage

of pesticides could help the farmers to improve the crop productivity.

Figure 9: Yield per hectare (million tonnes per hectare)

l

l

Rural Infrastructure and IT: Linking the production areas with the market would help

in easy distribution of pesticides. IT services would help create awareness among

farmers and educate them for optimum use of crop protection chemicals.

Availability of credit facilities: Govt. initiatives to provide credit facilities to farmers in

the rural areas will provide boost to the agriculture industry. Access to finance would

encourage them to use more pesticides in order to improve the crop yield.


9.89

7.3 7 7 7 6.65.2

4.3 4 3.8 3.3 3 2.9

Belgium

NetherlandsFrance

Germany

UK USAChin

a

Indonesia

BangladeshBraz

il

Srilank

a

Thailand

Pakistan

India

17


Green Chemistry in Agrochemical Sector

Green Chemistry

Green Chemistry Implementation Strategies

Green chemistry is a philosophy of chemical research and engineering that involves the

design of products and processes that minimize the use and generation of hazardous

chemicals. Unlike the environmental chemistry which focuses on the study of pollutant

chemicals and their effect on nature, green chemistry aims to reduce the pollution at the

source. Green chemistry involves waste minimization at source, use of catalysts in place

of reagents, use of non-toxic reagents, use of renewable resources, improved atom

efficiency and use of Solvent Free or Recyclable Environmentally Benign Solvent

systems.

Implementation of Green Chemistry practices can help the companies in achieving

material and energy efficiency and reduce the hazards involved in the entire life cycle of

the product.

Based on the implementation time, resources involved and associated implementation

risks green chemistry strategies can be categorized into three types: Short term

implementation strategies, medium term implementation strategies and long term

implementation strategies

Strategy Implementation Time Resources Required Associated Risks

Short Term 6 months to 18 months Low Low

Medium Term 18 months to 3 years Medium Medium

Long Term 3 years to 10 years High High

Figure 10: Green Chemistry Implementation Strategies

18


6.1.1 Short Term Strategies

On a short term basis the industry should look for possible ways to optimize their current

business practices by developing zero discharge solution, developing means for reducing

the COD (Chemical Oxygen Demand) levels in the wastewater generated and by

developing collaborative platforms so as to learn from the best practices employed in

other companies.

6.1.1.1 Zero Discharge Solution

The conventional wastewater treatment processes do not remove salinity in the treated

effluent. Discharging the saline waste water pollutes the ground and surface waters, also

impacting the nutrient value of the soil. In order to overcome the scarcity of water,

impact of saline water discharge and regulatory pressures associated, zero liquid

discharge solutions have been developed which mean zero discharge of wastewater

from industries. It involves advanced wastewater treatment technologies to recycle

recover and re-use the 'treated' wastewater, ensuring bare minimum discharge of

wastewater to the environment. Apart from reducing the environmental waste

discharge, it helps in 90-95% of water recovery and recovery of by-products from the salts

resulting in operational savings.

6.1.1.2 COD Reduction

Industrial wastewater containing organic and inorganic impurities are toxic and can't

undergo direct biological treatment. The industrial wastewater resulting from the spills,

leaks, product washings and effluents discharged from the chemical plants differ in

characteristics amongst themselves and from the domestic wastewater. Some of the key

waste generating sectors are pharma, agrochemicals and pigment industries. In order to

meet the specifications for discharge or for recycling the industrial effluents have to be

treated. Various methods have been developed to reduce the COD of the industrial waste

water. COD can be reduced by using H2O2, subcritical water oxidation, thermal-liquid

phase oxidation, isolated bacteria and using adsorbents like activated carbon, fly ash and

neem leaves.

6.1.1.3 Collaborative Platforms

Instead of competing with each other, by building up collaborative platforms across

various levels of management companies can learn from the best practices prevalent in

other companies. Such platforms build trust amongst the companies resulting in sharing

19


of knowledge and expertise which is important for dissemination of green chemistry

practices resulting in development of greener processes and products cost

efficiently.The collaborative platforms can be developed across various dimensions like

procurement, marketing and distribution, energy, water, waste disposal and safety. For

instance, development of a collaborative platform by the top six Indian pharmaceutical

companies has helped them to share the best practices amongst themselves. This has

resulted in energy cost reduction of Rs 10-15 crore and reduction in water consumption by

200 million liters within one year of establishment. It has also helped the companies in

enhancing their solvent recovery by 4-5%.

6.1.2 Medium Term Strategies

On a medium term basis companies should look for how they can change their chemistry

so that they can maximize the efficiency of their consumption of solvents. This helps

companies to reduce the amount of wastes generated, improve their material efficiency

and reduce the costs involved. Companies can also explore new greener aspects of

chemistry and chemical engineering like microwave chemistry.

6.1.2.1 Solvent recovery practice

The chemical industry heavily uses large quantities of organic solvents in a great number

of manufacturing steps which include chemical synthesis, fermentation, extraction,

formulation and finishing of products. They are used as reaction media and for products

extraction in the pharmaceutical, agrochemicals, specialty chemicals and fragrance

industries. Except few cases, the solvents used do not participate in the reaction. At the

end of the process, the solvents are usually contaminated and cannot be reused. Hence

the practice is to dispose them and use fresh solvents. It has been found that solvents

have been responsible for 40% of VOC emissions in Europe and their disposal costs go up

to 10% of the purchase price. This makes solvent recovery an important means to

implement green and sustainable chemistry. Some of the commonly used solvents are

NMP, isophorone and cyclohexanone.

6.1.2.2 Alternate Solvents

Traditionally the solvents used are derived from crude oil and result in high levels of toxic

emissions in the atmosphere. The increasing usage of the solvents along with strict

environmental regulations to lower the VOC (Volatile Organic Compounds) has resulted

in growth of biosolvents (greener alternatives). According to a research the green

solvent market is expected to reach USD 6.5 billion by 2018 at a CAGR of almost 8.5%.

18


6.1.1 Short Term Strategies

On a short term basis the industry should look for possible ways to optimize their current

business practices by developing zero discharge solution, developing means for reducing

the COD (Chemical Oxygen Demand) levels in the wastewater generated and by

developing collaborative platforms so as to learn from the best practices employed in

other companies.

6.1.1.1 Zero Discharge Solution

The conventional wastewater treatment processes do not remove salinity in the treated

effluent. Discharging the saline waste water pollutes the ground and surface waters, also

impacting the nutrient value of the soil. In order to overcome the scarcity of water,

impact of saline water discharge and regulatory pressures associated, zero liquid

discharge solutions have been developed which mean zero discharge of wastewater

from industries. It involves advanced wastewater treatment technologies to recycle

recover and re-use the 'treated' wastewater, ensuring bare minimum discharge of

wastewater to the environment. Apart from reducing the environmental waste

discharge, it helps in 90-95% of water recovery and recovery of by-products from the salts

resulting in operational savings.

6.1.1.2 COD Reduction

Industrial wastewater containing organic and inorganic impurities are toxic and can't

undergo direct biological treatment. The industrial wastewater resulting from the spills,

leaks, product washings and effluents discharged from the chemical plants differ in

characteristics amongst themselves and from the domestic wastewater. Some of the key

waste generating sectors are pharma, agrochemicals and pigment industries. In order to

meet the specifications for discharge or for recycling the industrial effluents have to be

treated. Various methods have been developed to reduce the COD of the industrial waste

water. COD can be reduced by using H2O2, subcritical water oxidation, thermal-liquid

phase oxidation, isolated bacteria and using adsorbents like activated carbon, fly ash and

neem leaves.

6.1.1.3 Collaborative Platforms

Instead of competing with each other, by building up collaborative platforms across

various levels of management companies can learn from the best practices prevalent in

other companies. Such platforms build trust amongst the companies resulting in sharing

19


of knowledge and expertise which is important for dissemination of green chemistry

practices resulting in development of greener processes and products cost

efficiently.The collaborative platforms can be developed across various dimensions like

procurement, marketing and distribution, energy, water, waste disposal and safety. For

instance, development of a collaborative platform by the top six Indian pharmaceutical

companies has helped them to share the best practices amongst themselves. This has

resulted in energy cost reduction of Rs 10-15 crore and reduction in water consumption by

200 million liters within one year of establishment. It has also helped the companies in

enhancing their solvent recovery by 4-5%.

6.1.2 Medium Term Strategies

On a medium term basis companies should look for how they can change their chemistry

so that they can maximize the efficiency of their consumption of solvents. This helps

companies to reduce the amount of wastes generated, improve their material efficiency

and reduce the costs involved. Companies can also explore new greener aspects of

chemistry and chemical engineering like microwave chemistry.

6.1.2.1 Solvent recovery practice

The chemical industry heavily uses large quantities of organic solvents in a great number

of manufacturing steps which include chemical synthesis, fermentation, extraction,

formulation and finishing of products. They are used as reaction media and for products

extraction in the pharmaceutical, agrochemicals, specialty chemicals and fragrance

industries. Except few cases, the solvents used do not participate in the reaction. At the

end of the process, the solvents are usually contaminated and cannot be reused. Hence

the practice is to dispose them and use fresh solvents. It has been found that solvents

have been responsible for 40% of VOC emissions in Europe and their disposal costs go up

to 10% of the purchase price. This makes solvent recovery an important means to

implement green and sustainable chemistry. Some of the commonly used solvents are

NMP, isophorone and cyclohexanone.

6.1.2.2 Alternate Solvents

Traditionally the solvents used are derived from crude oil and result in high levels of toxic

emissions in the atmosphere. The increasing usage of the solvents along with strict

environmental regulations to lower the VOC (Volatile Organic Compounds) has resulted

in growth of biosolvents (greener alternatives). According to a research the green

solvent market is expected to reach USD 6.5 billion by 2018 at a CAGR of almost 8.5%.

20


The green solvent market is segmented based on applications such as adhesives,

cosmetics, pharmaceuticals, agrochemicals, paints and coatings. Depending on product

type, green solvents are categorized as soy methyl esters, lactate esters, derived from

soyabeanoil, a biodegradable alternative can replace almost 500 pounds of traditional

chlorinated and petroleum solvents. Ethyl lactate, another green solvent has replaced

solvents like NMP, toluene, acetone and xylene. The greener alternatives are

biodegradable, easy to recycle, result in reduced harmful emissions and are non-

corrosive and non-carcinogenic.

6.1.2.3 Biocatalysts

Biocatalysis is the use of isolated enzymes or whole cells for synthetic transformation.

Enzymes are catalytic proteins that catalyze reactions in the living organisms. Enzymes

are highly efficient catalysts resulting in rate enhancement of reaction to about 106 to

1017. Enzymes have a very good selectivity i.e. ability to work with a single compound

resulting in high yield of a specific product. Compared to chemical catalysts biocatalysts orequire milder reaction conditions (pH range of 5-8 and temperature range of 20-40 C).

Biocatalysts are more efficient (lower concentration of enzymes are needed), can be

easily modified to increase their selectivity, stability and activity. Traditionally

biocatalysts have been used in production of alcohol and cheese, however recently they

are being increasingly used in the pharmaceutical, agrochemical and food industries.

Apart from being environment friendly and biodegradable, the use of biocatalysts can

help the chemical companies to improve their yield and reduce the wastes generated.

6.1.2.4 Microwave Chemistry

Microwave chemistry involves use of microwave radiations to carry out chemical

reactions. Microwaves act as high frequency electric fields and heat any material

containing mobile electric charges such as polar molecules in a solvent or conducting ions

in a solid. This involves agitation of polar molecules or ions that oscillate underthe effect

of an oscillating electric or magnetic field. Under the presence of an oscillating field, the

particles try to orient themselves or be in phase with the field. But due to inter-particle

interaction and electrical resistance the motion of these particles gets restricted

resulting in random motion generating heat. Different materials have different response

to microwaves, some are transparent to them (e.g. sulphur), some reflect them (e.g.

copper) and some absorb them (e.g. water). Microwave chemistry is used in organic

synthesis at elevated pressures or in dry media, synthesis of organometallic and

21


coordination compounds, synthesis of ceramic products and have applications in

polymer chemistry. Microwave chemistry finds applications in pharmaceutical industry,

agrochemical industry, polymer synthesis, chemical synthesis and extraction,

nanoparticle synthesis and biochemical and drying activities.

Microwave Chemistry Advantages

• Efficient source of heating

Uniform heating throughout reaction mixture

Low energy consumption

Provide selective heating depending on

microwave absorption

• Enhanced heating rate: 10 to 1,000 times

compared to conventional heating

• Produce higher yields

• Cleaner, environment friendly chemistry

• Reduced use of solvents

Figure 11: Advantages of Microwave Chemistry

6.1.3 Long Term Strategies

In a long term companies should look for developing new green routes of chemical

synthesis. This involves shifting dependence form fossil fuels to renewable resources,

and biomass as feedstock to develop biopesticides. The Indian companies should also

invest in R&D activities so as to greener synthesis routes and products.

6.1.3.1 Bio-pesticides

Bio-pesticides, also called as biological pesticides provide an ecofriendly alternative to

the traditional pesticides. These pesticides are based on pathogenic microorganisms

specific to a target pest, there by providing an ecologically sound and effective solution to

pest problems. The commonly used bio-pesticides are living organisms, which are

pathogenic for the pest of interest like biofungicides (Trichoderma), bioherbicides

(Phytopthora) and bioinsecticides (Bacillus thuringiensis). Globally, there are 175

registered biopesticide active-ingredients and 700 products available in the market. The

global market for biopesticides is currently valued at USD 1.5Bn in FY13. As compared to

the industry growth rate of 5.5% CAGR, the bio-pesticide market is expected to grow at a

CAGR of 15.5% to reach USD 3.2 Bn by FY18.

20


The green solvent market is segmented based on applications such as adhesives,

cosmetics, pharmaceuticals, agrochemicals, paints and coatings. Depending on product

type, green solvents are categorized as soy methyl esters, lactate esters, derived from

soyabeanoil, a biodegradable alternative can replace almost 500 pounds of traditional

chlorinated and petroleum solvents. Ethyl lactate, another green solvent has replaced

solvents like NMP, toluene, acetone and xylene. The greener alternatives are

biodegradable, easy to recycle, result in reduced harmful emissions and are non-

corrosive and non-carcinogenic.

6.1.2.3 Biocatalysts

Biocatalysis is the use of isolated enzymes or whole cells for synthetic transformation.

Enzymes are catalytic proteins that catalyze reactions in the living organisms. Enzymes

are highly efficient catalysts resulting in rate enhancement of reaction to about 106 to

1017. Enzymes have a very good selectivity i.e. ability to work with a single compound

resulting in high yield of a specific product. Compared to chemical catalysts biocatalysts orequire milder reaction conditions (pH range of 5-8 and temperature range of 20-40 C).

Biocatalysts are more efficient (lower concentration of enzymes are needed), can be

easily modified to increase their selectivity, stability and activity. Traditionally

biocatalysts have been used in production of alcohol and cheese, however recently they

are being increasingly used in the pharmaceutical, agrochemical and food industries.

Apart from being environment friendly and biodegradable, the use of biocatalysts can

help the chemical companies to improve their yield and reduce the wastes generated.

6.1.2.4 Microwave Chemistry

Microwave chemistry involves use of microwave radiations to carry out chemical

reactions. Microwaves act as high frequency electric fields and heat any material

containing mobile electric charges such as polar molecules in a solvent or conducting ions

in a solid. This involves agitation of polar molecules or ions that oscillate underthe effect

of an oscillating electric or magnetic field. Under the presence of an oscillating field, the

particles try to orient themselves or be in phase with the field. But due to inter-particle

interaction and electrical resistance the motion of these particles gets restricted

resulting in random motion generating heat. Different materials have different response

to microwaves, some are transparent to them (e.g. sulphur), some reflect them (e.g.

copper) and some absorb them (e.g. water). Microwave chemistry is used in organic

synthesis at elevated pressures or in dry media, synthesis of organometallic and

21


coordination compounds, synthesis of ceramic products and have applications in

polymer chemistry. Microwave chemistry finds applications in pharmaceutical industry,

agrochemical industry, polymer synthesis, chemical synthesis and extraction,

nanoparticle synthesis and biochemical and drying activities.

Microwave Chemistry Advantages

• Efficient source of heating

Uniform heating throughout reaction mixture

Low energy consumption

Provide selective heating depending on

microwave absorption

• Enhanced heating rate: 10 to 1,000 times

compared to conventional heating

• Produce higher yields

• Cleaner, environment friendly chemistry

• Reduced use of solvents

Figure 11: Advantages of Microwave Chemistry

6.1.3 Long Term Strategies

In a long term companies should look for developing new green routes of chemical

synthesis. This involves shifting dependence form fossil fuels to renewable resources,

and biomass as feedstock to develop biopesticides. The Indian companies should also

invest in R&D activities so as to greener synthesis routes and products.

6.1.3.1 Bio-pesticides

Bio-pesticides, also called as biological pesticides provide an ecofriendly alternative to

the traditional pesticides. These pesticides are based on pathogenic microorganisms

specific to a target pest, there by providing an ecologically sound and effective solution to

pest problems. The commonly used bio-pesticides are living organisms, which are

pathogenic for the pest of interest like biofungicides (Trichoderma), bioherbicides

(Phytopthora) and bioinsecticides (Bacillus thuringiensis). Globally, there are 175

registered biopesticide active-ingredients and 700 products available in the market. The

global market for biopesticides is currently valued at USD 1.5Bn in FY13. As compared to

the industry growth rate of 5.5% CAGR, the bio-pesticide market is expected to grow at a

CAGR of 15.5% to reach USD 3.2 Bn by FY18.

22


North America consumes the largest share of global biopesticides (40%) followed by

Europe (20%). Asia Pacific and Europe are the fastest growing markets and are expected

to grow at CAGR of 14.2% and 16% respectively. The Indian market currently stands at 0.16

USD billion and is expected to grow to 0.35 USD billion by 2018 at a CAGR of 17.3%. Neem

based pesticides, Bacillus thuringiensis, Nuclear Polyhedrosis Virus and Trichoderma are

some of the major biopesticides produced and used in India.

They key growth drivers for the increase in demand of bio-pesticides are:

Increasing demand for residue free crop protection products

Growth in organic food market

Easy registrations compared to conventional pesticides

Increasing concern about safety and toxicity of traditional pesticides

The key benefits of the bio-pesticides are:

Cost effectiveness: Costlier but reduced number of applications

Low residual effect and mostly biodegradable

Low pest resurgence

Target specific and less harmful on beneficial pests

l

l

l

l

l

l

l

l

Figure 12: Global bio-pesticides market

1.5

3.2

FY13 FY18


15.5%

23


6.1.3.2 Product and Process Innovation

It is important for the agrochemical companies to innovate products which can improve

the effectiveness of pesticide usage as well as reduce the negative impacts on

environment.Currently the Indian companies invest 1-2% of their turnover in R&D as

compared to 12-15% spend by the multinational companies. It is therefore essential for the

Indian companies should to invest in R&D activities for implementing green practices.

Some of the focus areas can be:

Developing water based formulations

Developing Target specific chemicals instead of broad specific chemicals

Greener routes of chemical synthesis

Reduce the number of steps involved in product synthesis

Development of lower dosage molecules leading to lesser volume

implementation and reduced quantity of active ingredients going in atmosphere

6.1.3.3 Industrial Ecology

Industrial ecology is a multi-disciplinary approach that combines different aspects of

engineering, economics, sociology, toxicology and natural sciences. It is an ecosystem

artificially setup in which various stakeholders (Industries, Government bodies,

educational institutes, NGOs and society) come together and develop a symbiotic system

where the entities through the dependence on outputs and by-products generated by

other members of the ecosystem achieve material and energy efficiency and reduction in

wastes generated.

Apart from depending on other partners for raw materials, companies also have the

opportunity to look for possible ways of converting the wastes generated from their

processes into useful products which can be used for their own operations. By

developing a complete chain of green chemical processes in different sectors, Industrial

ecology helps in establishing a viableand sustainable looping system.

Industrial ecology helps in reducing raw material and energy consumption, reduced

external dependence on feedstock and utilities, reduces the toxic waste generation

resulting in cost savings and helps in improving the image of agrochemical companies.

l

l

l

l

l

22


North America consumes the largest share of global biopesticides (40%) followed by

Europe (20%). Asia Pacific and Europe are the fastest growing markets and are expected

to grow at CAGR of 14.2% and 16% respectively. The Indian market currently stands at 0.16

USD billion and is expected to grow to 0.35 USD billion by 2018 at a CAGR of 17.3%. Neem

based pesticides, Bacillus thuringiensis, Nuclear Polyhedrosis Virus and Trichoderma are

some of the major biopesticides produced and used in India.

They key growth drivers for the increase in demand of bio-pesticides are:

Increasing demand for residue free crop protection products

Growth in organic food market

Easy registrations compared to conventional pesticides

Increasing concern about safety and toxicity of traditional pesticides

The key benefits of the bio-pesticides are:

Cost effectiveness: Costlier but reduced number of applications

Low residual effect and mostly biodegradable

Low pest resurgence

Target specific and less harmful on beneficial pests

l

l

l

l

l

l

l

l

Figure 12: Global bio-pesticides market

1.5

3.2

FY13 FY18


15.5%

23


6.1.3.2 Product and Process Innovation

It is important for the agrochemical companies to innovate products which can improve

the effectiveness of pesticide usage as well as reduce the negative impacts on

environment.Currently the Indian companies invest 1-2% of their turnover in R&D as

compared to 12-15% spend by the multinational companies. It is therefore essential for the

Indian companies should to invest in R&D activities for implementing green practices.

Some of the focus areas can be:

Developing water based formulations

Developing Target specific chemicals instead of broad specific chemicals

Greener routes of chemical synthesis

Reduce the number of steps involved in product synthesis

Development of lower dosage molecules leading to lesser volume

implementation and reduced quantity of active ingredients going in atmosphere

6.1.3.3 Industrial Ecology

Industrial ecology is a multi-disciplinary approach that combines different aspects of

engineering, economics, sociology, toxicology and natural sciences. It is an ecosystem

artificially setup in which various stakeholders (Industries, Government bodies,

educational institutes, NGOs and society) come together and develop a symbiotic system

where the entities through the dependence on outputs and by-products generated by

other members of the ecosystem achieve material and energy efficiency and reduction in

wastes generated.

Apart from depending on other partners for raw materials, companies also have the

opportunity to look for possible ways of converting the wastes generated from their

processes into useful products which can be used for their own operations. By

developing a complete chain of green chemical processes in different sectors, Industrial

ecology helps in establishing a viableand sustainable looping system.

Industrial ecology helps in reducing raw material and energy consumption, reduced

external dependence on feedstock and utilities, reduces the toxic waste generation

resulting in cost savings and helps in improving the image of agrochemical companies.

l

l

l

l

l

24


Judicious use of Agrochemicals

The non-judicious use of pesticides and use of old application technologies have resulted

in harmful impact by the pesticides on the human health and environment.This has

posed serious challenges to the agrochemical industry leading to creation of poor image

for agrochemical companies in front offarmers. The use of conventional technologies

have resulted in pesticides impactingover 90% of the non-target species like air, soil,

water and human beings. Pesticides when sprayed drift through air as suspended

particles, contaminating the air in other areas affecting the human life and the entire

ecosystem. The pesticides also contaminate the water and soil by percolating or leaching

through soil, running off to the unintended areas, or by spillage and neglect. On the other

hand, the use of new technologies like Drift Reduction technologies (Low drift

nozzles/atomizers, drift retardant products, electrostatic sprayers and air assisted

sprayers) can help reduce the impact of pesticides on environment and human health.

Some of the other modern technologies which can help in reducing the excessive usage

of pesticides are the use of injection syringes, GPS and weed-eye technology. Compared

to conventional sprayers, the injection syringes help the farmers to select different

mixture of pesticides for different fields. The injection syringes also help the farmer to

continuously change the concentration of single pesticide. This helps in reducing the

pesticide use.

The GPS technology can reduce the pesticide consumption by up to 10% by preventing

double treatment, mapping of pest populations and by helping in calculating the amount

of pesticide required and time of application. The GPS technology also helps in selective

spraying of pesticides. Similarly, the weed-eye technology is a recognition technology

which uses infrared light to distinguish between the different weed species and

accordingly target the desired species.

Theuneducated use of pesticides also has a detrimental impact on the human health. For

instance, in the state of Punjab the number of cancer patients has grown manifold in the

Malwa region over the last few years. According to the statistics Punjab has over 90

cancer patients per one lakh of population as compared to the national average of 80 per

lakh. The Malwa region also known as the cancer belt has an average of 136 per lakh. Over

the last five years on an average 18 people die of cancer every day. The gravity of the

situation is so high that the railway train to Bikaner for cheap treatment is known as the

"Cancer Train" has become a common phrase. The reason for this is the indiscriminate

25


use of the pesticides which has even contaminated the ground water. The country's food

bowl is paying the price for the benefits it reaped from the green revolution.

Therefore, it is essential that crop protection products are used judiciously in terms of right

product, correct dosage and application methodology, and minimizing their impact on

non-target species like air, soil, water and human beings.

It is not only the responsibility of the government but also the manufacturers to advise

the farming community to make safe and judicious use of pesticides. Pesticides should be

used when necessary and farmers should always adhere to the set of guidelines

recommended by the scientists and the experts.

In developed countries the usage of pesticides is 20 times more than India; their crop

yields are much higher than ours. For this we must take steps to spread awareness on the

judicious use of pesticides by organising educational programmes, seminars, publicity

campaigns, radio and TV talk and kisanmelas from time to time.

We must realize that pesticides are as important as any other ingredient for the crop

production in this country. Pesticides like drugs are beneficial to man when properly used:

if misused they may be extremely dangerous. It is entirely possible for a user to handle

pesticides safely for many years with no obvious ill-effects to himself or his environment.

The ill effects are preventable. Safe handling of pesticides by the user may be dealt with

under the following precautionary measures:

Pesticide Selection

- Before making a selection, the pest problem should be identified

- Select a pesticide that would control the pest with minimum danger to other

organisms

- The pesticide should be one approved, registered and recommended

- Only the required quantity of pesticide should be bought and storage should be

avoided

Dosage and Application Methodology

- Exact dosage as prescribed should be used

- The dilution ratios should not be altered

24


Judicious use of Agrochemicals

The non-judicious use of pesticides and use of old application technologies have resulted

in harmful impact by the pesticides on the human health and environment.This has

posed serious challenges to the agrochemical industry leading to creation of poor image

for agrochemical companies in front offarmers. The use of conventional technologies

have resulted in pesticides impactingover 90% of the non-target species like air, soil,

water and human beings. Pesticides when sprayed drift through air as suspended

particles, contaminating the air in other areas affecting the human life and the entire

ecosystem. The pesticides also contaminate the water and soil by percolating or leaching

through soil, running off to the unintended areas, or by spillage and neglect. On the other

hand, the use of new technologies like Drift Reduction technologies (Low drift

nozzles/atomizers, drift retardant products, electrostatic sprayers and air assisted

sprayers) can help reduce the impact of pesticides on environment and human health.

Some of the other modern technologies which can help in reducing the excessive usage

of pesticides are the use of injection syringes, GPS and weed-eye technology. Compared

to conventional sprayers, the injection syringes help the farmers to select different

mixture of pesticides for different fields. The injection syringes also help the farmer to

continuously change the concentration of single pesticide. This helps in reducing the

pesticide use.

The GPS technology can reduce the pesticide consumption by up to 10% by preventing

double treatment, mapping of pest populations and by helping in calculating the amount

of pesticide required and time of application. The GPS technology also helps in selective

spraying of pesticides. Similarly, the weed-eye technology is a recognition technology

which uses infrared light to distinguish between the different weed species and

accordingly target the desired species.

Theuneducated use of pesticides also has a detrimental impact on the human health. For

instance, in the state of Punjab the number of cancer patients has grown manifold in the

Malwa region over the last few years. According to the statistics Punjab has over 90

cancer patients per one lakh of population as compared to the national average of 80 per

lakh. The Malwa region also known as the cancer belt has an average of 136 per lakh. Over

the last five years on an average 18 people die of cancer every day. The gravity of the

situation is so high that the railway train to Bikaner for cheap treatment is known as the

"Cancer Train" has become a common phrase. The reason for this is the indiscriminate

25


use of the pesticides which has even contaminated the ground water. The country's food

bowl is paying the price for the benefits it reaped from the green revolution.

Therefore, it is essential that crop protection products are used judiciously in terms of right

product, correct dosage and application methodology, and minimizing their impact on

non-target species like air, soil, water and human beings.

It is not only the responsibility of the government but also the manufacturers to advise

the farming community to make safe and judicious use of pesticides. Pesticides should be

used when necessary and farmers should always adhere to the set of guidelines

recommended by the scientists and the experts.

In developed countries the usage of pesticides is 20 times more than India; their crop

yields are much higher than ours. For this we must take steps to spread awareness on the

judicious use of pesticides by organising educational programmes, seminars, publicity

campaigns, radio and TV talk and kisanmelas from time to time.

We must realize that pesticides are as important as any other ingredient for the crop

production in this country. Pesticides like drugs are beneficial to man when properly used:

if misused they may be extremely dangerous. It is entirely possible for a user to handle

pesticides safely for many years with no obvious ill-effects to himself or his environment.

The ill effects are preventable. Safe handling of pesticides by the user may be dealt with

under the following precautionary measures:

Pesticide Selection

- Before making a selection, the pest problem should be identified

- Select a pesticide that would control the pest with minimum danger to other

organisms

- The pesticide should be one approved, registered and recommended

- Only the required quantity of pesticide should be bought and storage should be

avoided

Dosage and Application Methodology

- Exact dosage as prescribed should be used

- The dilution ratios should not be altered

26


- Pesticide should be applied exactly as described

- No experimentation should be done on farm by end-users out of curiosity

Minimizing contact with non-target species

- Correct spraying systems should only be used

- Unused pesticide water should not be drained or mixed with fresh water. It should be

kept separately and used as soon as possible

- Proper personal protective equipments (PPE) such as gloves, masks etc. should be

used while handling pesticides

- Any spillage of pesticides should be cleaned properly and immediately

27


The Way Ahead

The agrochemicals industry is poised for major growth in coming years. However, for a

sustainable growth it is imperative for agrochemical manufacturers to adopt green

chemistry processes, develop new products which are nearly 100% green and educate

and train the farmers for proper usage.

Focus on Green Chemistry will help the companies to design new products and processes

with sustainability as the core principle. Over the long term, this will help the companies

to differentiate themselves and build competitive advantage.

However, the industry cannot implement the green chemistry practices in isolation. It is

imperative to build a collaborative ecosystem in which the academia, industry,

government and regulatory bodies come together and create opportunities for the

industry, academia and the Entrepreneurs to test, scale-up and commercialize their ideas

in the domain of green chemistry practices. Ideas or concepts with potential should be

nurtured and adequate support should be provided for scale-up and commercialization.

This would encourage creation of inventions and innovations in the field of green

chemistry.

The companies should also perform a process and environmental impact audit of their

existing products. This would help the companies to perform an environmental audit of

their current products and processes, evaluate the potential impacts of their products,

and take actions to develop greener products and processes.

Companies need to relentlessly educate and train the farmers on judicious usage of

pesticides and implement practices like reverse logistics through which unused products

and packaging are procured back from the farmers.

Adoption of green chemistry practices, green products and embracing farmers to

promote judicious usage of crop protection products will be an appropriate way for

companies to develop a long term sustainable business model for their companies.

26


- Pesticide should be applied exactly as described

- No experimentation should be done on farm by end-users out of curiosity

Minimizing contact with non-target species

- Correct spraying systems should only be used

- Unused pesticide water should not be drained or mixed with fresh water. It should be

kept separately and used as soon as possible

- Proper personal protective equipments (PPE) such as gloves, masks etc. should be

used while handling pesticides

- Any spillage of pesticides should be cleaned properly and immediately

27


The Way Ahead

The agrochemicals industry is poised for major growth in coming years. However, for a

sustainable growth it is imperative for agrochemical manufacturers to adopt green

chemistry processes, develop new products which are nearly 100% green and educate

and train the farmers for proper usage.

Focus on Green Chemistry will help the companies to design new products and processes

with sustainability as the core principle. Over the long term, this will help the companies

to differentiate themselves and build competitive advantage.

However, the industry cannot implement the green chemistry practices in isolation. It is

imperative to build a collaborative ecosystem in which the academia, industry,

government and regulatory bodies come together and create opportunities for the

industry, academia and the Entrepreneurs to test, scale-up and commercialize their ideas

in the domain of green chemistry practices. Ideas or concepts with potential should be

nurtured and adequate support should be provided for scale-up and commercialization.

This would encourage creation of inventions and innovations in the field of green

chemistry.

The companies should also perform a process and environmental impact audit of their

existing products. This would help the companies to perform an environmental audit of

their current products and processes, evaluate the potential impacts of their products,

and take actions to develop greener products and processes.

Companies need to relentlessly educate and train the farmers on judicious usage of

pesticides and implement practices like reverse logistics through which unused products

and packaging are procured back from the farmers.

Adoption of green chemistry practices, green products and embracing farmers to

promote judicious usage of crop protection products will be an appropriate way for

companies to develop a long term sustainable business model for their companies.

28


Figure 13: The Way Ahead

Green Chemistry –The Way Ahead

1

4 2

3

Academia support

Industry initiatives

• Perform process and environmental impact audit of existing products /processes

• Invest in R&D activities• Rigorous support from top management • Organize industrial roundtables

• Promote technopreneurs through angel investments

• Build green chemistry related academic programs

• Collaborate with industry for R&D activities

• Promote green chemistry through academic

events

• Support technopreneurs in testing and scaling

up green chemistry ideas

Govt./Regulatory bodies support

• Develop green chemistry rating system to evaluate industry performance

• Promote green chemistry initiatives through subsidies and investment support to MSMEs and technopreneurs

• Fast track regulations and unique clear guidelines for green products

• Promote green chemistry as means of CSR

Role of end users

• Demand for green products

• Focus on overall benefits, not just costs alone

29


References

1. Knowledge paper for FICCI Agrochemicals Conclave 2013prepared by Tata Strategic

2. "Reengineering Chemistry for better tomorrow", Knowledge paper for Industrial

Green Chemistry 2013 prepared by Tata Strategic

3. Agropages website

4. Chemtech Foundation article on pesticide industry

5. Indian Agrochemical Industry report by Sunidhi Institutional Research

6. United Phosphorus Limited Annual Report, FY13

7. Article on growing importance of Agrochemicals by KPMG

8. R&D Trends for Chemical Crop Protection Products by Phillips McDougall

9. Primary interactions with Industry experts

28


Figure 13: The Way Ahead

Green Chemistry –The Way Ahead

1

4 2

3

Academia support

Industry initiatives

• Perform process and environmental impact audit of existing products /processes

• Invest in R&D activities• Rigorous support from top management • Organize industrial roundtables

• Promote technopreneurs through angel investments

• Build green chemistry related academic programs

• Collaborate with industry for R&D activities

• Promote green chemistry through academic

events

• Support technopreneurs in testing and scaling

up green chemistry ideas

Govt./Regulatory bodies support

• Develop green chemistry rating system to evaluate industry performance

• Promote green chemistry initiatives through subsidies and investment support to MSMEs and technopreneurs

• Fast track regulations and unique clear guidelines for green products

• Promote green chemistry as means of CSR

Role of end users

• Demand for green products

• Focus on overall benefits, not just costs alone

29


References

1. Knowledge paper for FICCI Agrochemicals Conclave 2013prepared by Tata Strategic

2. "Reengineering Chemistry for better tomorrow", Knowledge paper for Industrial

Green Chemistry 2013 prepared by Tata Strategic

3. Agropages website

4. Chemtech Foundation article on pesticide industry

5. Indian Agrochemical Industry report by Sunidhi Institutional Research

6. United Phosphorus Limited Annual Report, FY13

7. Article on growing importance of Agrochemicals by KPMG

8. R&D Trends for Chemical Crop Protection Products by Phillips McDougall

9. Primary interactions with Industry experts

30


About Tata Strategic

Founded in 1991 as a division of Tata Industries Ltd, Tata Strategic Management Group is

the largest Indian own management consulting firm. It has a 50 member strong

consulting team supported by a panel of domain experts. Tata Strategic has undertaken

500+ engagements, with over 100 clients, across countries and sectors.

It has a growing client base outside India with increasing presence outside the Tata

Group. A majority of revenues now come from outside the group and more than 20%

revenues from clients outside India.

Tata Strategic offers a comprehensive range of solutions covering Direction Setting,

Driving Strategic Initiatives and Implementation Support

31


Our Offerings

lVision lIndia EntrylMarket insights lAlliance & Acquisition PlanninglGrowth Strategy/Business Plans lStrategic due diligencelRural Strategy lScenario PlanninglDigital Strategy lManufacturing Strategy

lOrganization StructurelCorporate Center DesignlRoles & Decision ruleslPerformance ManagementlCapability AssessmentlTalent ManagementlDelegation & MIS

lRevenue Enhancement

lProduct Innovation

lMarket ShareRura/Urban

lGo to Market

lDealer Effectiveness

lSupply Chain OptimizationlThroughput enhancementlSuperior FulfillmentlProject ExcellencelProcurement TransformationlStrategic Cost ReductionlVendor Compliance

lImplementation PlanlProgram ManagementlRefinements/Course

Corrections

Set Direction

Drive StrategicInitiatives

SupportImplementation

Strategy

Marketing & Sales Operations

Implementation Support

Organization Effectiveness

Reports co-authored by Punit Rathi ([email protected]) and Manan Agrawal ([email protected])

Tata Strategic Contacts

Manish PanchalPractice Head - Chemicals, Logistics and Energy

Mobile: +91 98205 20303

E-mail: [email protected]

Phone: +91 22 6637 6713

CharuKapoorEngagement Manager - ChemicalsMobile: +91 98218 06071E-mail: [email protected]: +91 22 6637 6756

30


About Tata Strategic

Founded in 1991 as a division of Tata Industries Ltd, Tata Strategic Management Group is

the largest Indian own management consulting firm. It has a 50 member strong

consulting team supported by a panel of domain experts. Tata Strategic has undertaken

500+ engagements, with over 100 clients, across countries and sectors.

It has a growing client base outside India with increasing presence outside the Tata

Group. A majority of revenues now come from outside the group and more than 20%

revenues from clients outside India.

Tata Strategic offers a comprehensive range of solutions covering Direction Setting,

Driving Strategic Initiatives and Implementation Support

31


Our Offerings

lVision lIndia EntrylMarket insights lAlliance & Acquisition PlanninglGrowth Strategy/Business Plans lStrategic due diligencelRural Strategy lScenario PlanninglDigital Strategy lManufacturing Strategy

lOrganization StructurelCorporate Center DesignlRoles & Decision ruleslPerformance ManagementlCapability AssessmentlTalent ManagementlDelegation & MIS

lRevenue Enhancement

lProduct Innovation

lMarket ShareRura/Urban

lGo to Market

lDealer Effectiveness

lSupply Chain OptimizationlThroughput enhancementlSuperior FulfillmentlProject ExcellencelProcurement TransformationlStrategic Cost ReductionlVendor Compliance

lImplementation PlanlProgram ManagementlRefinements/Course

Corrections

Set Direction

Drive StrategicInitiatives

SupportImplementation

Strategy

Marketing & Sales Operations

Implementation Support

Organization Effectiveness

Reports co-authored by Punit Rathi ([email protected]) and Manan Agrawal ([email protected])

Tata Strategic Contacts

Manish PanchalPractice Head - Chemicals, Logistics and Energy

Mobile: +91 98205 20303

E-mail: [email protected]

Phone: +91 22 6637 6713

CharuKapoorEngagement Manager - ChemicalsMobile: +91 98218 06071E-mail: [email protected]: +91 22 6637 6756

32


Established in 1927, FICCI is one of the largest and oldest apex business organizations in India. FICCI's history is closely interwoven with India's struggle for independence, industrialization and emergence as one of the most rapidly growing global economies. FICCI has contributed to this historical process by encouraging debate, articulating the private sector's views and influencing policy.

A not-for-profit organization, FICCI is the voice of India's business and industry.

FICCI draws its membership from the corporate sector, both private and public, including MNCs; FICCI enjoys direct and indirect membership of over 2,50,000 companies from various regional chambers of commerce and through its 70 industry association.

FICCI provides a platform for sector specific consensus building and networking and is the first port of call for Indian industry and the international business community.

Our Vision

To be the thought leader for industry, its voice for policy change and its guardian for effective implementation.

Our Mission

To carry forward our initiatives in support of rapid, inclusive and sustainable growth that encompasses health, education, livelihood, governance and skill development.

To enhance the efficiency and global competitiveness of the Indian industry and to expand business opportunities both in domestic and foreign markets through a range of specialized services and global linkages.

About FICCI

Documents

Knowledge Paper on SAFE&JUDICIOUSUSEOFAGROCHEMICALS …ficci.in/spdocument/20377/Agro-Knowledge-paper.pdf · 2014-04-23 · Manish Panchal Practice Head - Chemical & Energy Tata Strategic