Overview on agrochemical multinationals’ Q2 sales results

The world leading agrochemical companies announced their 2009 second quarter’s sales results in droves. Syngenta, Dow AgroSciences recorded a decline of 16.1% and 12.0% compared with the corresponding period last year. BSAF’s agricultural solutions division was the only one across the group recording growth in sales as well as earnings. Bayer CropScience’s crop protection sales inched up by 0.9% in the second quarter. DuPont’s crop protection business recorded a substantial decline in sales and earning, but the agriculture and nutrition segment posted a 2.8% increase.

Agrochemical multinationals’ Q2 sales results (ended June 30th)

 Syngenta

Syngenta was hit by the combined effects of currency fluctuations, higher raw material costs and drought in Latin America, leading to a 16.1% dip in its second-quarter agrochemical sales to $2,415 million.

Dow AgroSciencesAdverse weather conditions and lower demand cut Dow AgroSciences’ sales by 12% to $1,204 million in the second quarter of 2009.

The decline in Dow AgroSciences’ sales in the second quarter followed 11 consecutive quarters of growth. Volumes were down by 7% and prices by 5% due to currency effects.

Demand was impacted by unusually wet weather in North America and Europe, and drought in Argentina, the company points out. In addition, lower farm commodity prices drove farmers to reduce input costs. A “collapse” in the price of the herbicide, glyphosate, during the quarter and increased competition from imported generics led to a steep decline in the value of inventories. Despite the unfavourable market conditions, there was continued growth from Dow’s cereal herbicide, pyroxsulam, and its rice herbicide, penoxsulam.
 

Bayer CropScience

Bayer CropScience’s crop protection sales inched up by 0.9% in the second quarter of 2009 to €1,540 million ($2,186 million at the current rate). The company cites unfavourable weather conditions for the meek growth, but notes strong increases in some of its product segments. Last year’s second-quarter crop protection business saw a jump in sales of over 20%.

The CropScience division was boosted in this year’s second quarter by higher sales in the non-crop, and seed and trait businesses.Second-quarter sales for the CropScience division were up by 2.7% to €1,852 million ($2,628 million).

Despite adverse weather conditions, herbicide sales grew by 4% and insecticides by 12.5%. The herbicide business replaced fungicides as the largest product segment. Seed treatments grew by a third following “early receipt of orders” for the North American autumn season, while fungicide sales dropped by over 14%. Crop protection prices were up, but volumes were down.

Crop protection sales for the quarter in Bayer’s main region, Europe, fell by 8.8% to €634 million, but by just 2.1% after currency adjustments. Fungicide sales were hit by lower disease levels in southern Europe, and herbicides by reduced cereal areas. Insecticide and seed treatment segments grew, led by sales of the insecticide, Biscaya (thiacloprid).
 

BSAF

BASF’s agricultural solutions division registered a 1.4% increase in sales to €1,175 ($1,668 million at the current rate) in the second quarter of 2009. "Higher prices, positive currency effects and the acquired Sorex business more than offset a slight decline in volumes,” says BASF chief financial officer Dr Kurt Bock.

DuPont

DuPont’s crop protection business recorded a substantial decline in sales and earnings in the second quarter of 2009.The agriculture and nutrition segment posted a 2.8% increase in sales to $2,613 million, with a 7% rise in prices being partly offset by a 4% volume decline.

In the crop protection sector, favourable pricing and strong sales of the insecticide, Rynaxypyr (chlorantraniliprole), were more than offset by substantial adverse currency effects and lower volumes of herbicides and fungicides. The crop protection market softened due to weather conditions in key agricultural markets, DuPont points out.

Europe saw near perfect planting conditions, despite it being a late season. In North America, insecticide sales growth was more than offset by lower demand for herbicides for maize and small-grain cereals. Delayed planting due to wet weather eliminated some fungicide and herbicide applications. Latin America continued to be affected by drought.

Prices were down due to lower pricing of the herbicide, glyphosate, while volumes were impacted by the drought and reduced sugar cane plantings. DuPont saw significant volume growth in the Asia/Pacific region, primarily due to Rynaxypyr sales.