Driving Agricultural Excellence: The Significance of CDMOs in India’s Agrochemical Sector

AGROCHEMICAL CDMO industry in India is rapidly evolving driven by the growing demand for advanced agriculture inputs to support the country’s expanding agricultural sector. With the increasing need to boost crop yields and ensure food security, agrochemicals, such as pesticides, herbicides, and fertilizers, play a vital role in the Indian agricultural landscape. CDMOs offer specialized services in developing, formulating, and manufacturing these products, providing flexibility and cost-efficiency to agrochemical companies. 

For instance, according to a research report by the Federation of Indian Chambers of Commerce & (FICCI), India is now the fourth-largest producer of agrochemicals in the world underscoring the industry's expanding global footprint.

Strategic collaboration between UPL Ltd, one of India’s largest agrochemical companies, and a leading European CDMO. This partnership aims to expand UPL’s R&D and formulation capabilities, making use of India's advanced chemical manufacturing expertise to supply global markets. This collaboration reflects a broader trend of global agrochemical giants relying on Indian CDMOs to innovate and enhance efficiency.

According to our analysis, Global Agrochemical CDMO Market is estimated to grow USD 32.4 Billion in 2024 with CAGR of 10.3%, whereas Asia Pacific is expected to boost USD 9.72 Billion in 2024. Below is the graphical representation for these values.

Agrochemical CDMO Market Size in 2024

Current Landscape of the Agrochemical CDMO Market in India

Companies are allocating more funds to R&D to develop innovative agrochemical products, such as biopesticides and biofertilizers, which are gaining popularity due to environmental concerns. For example, Bharat Rasayan Limited has ramped up its R&D efforts to develop eco-friendly agrochemicals, contributing to sustainable farming practices.

There is a notable trend of expanding manufacturing capabilities to meet both domestic and international demand. This includes upgrading existing facilities and constructing new ones. For instance, UPL Limited announced a significant investment in expanding its manufacturing facilities in Gujarat to increase production capacity for various agrochemical products aiming for a larger market share.

APAC Agrochemical CDMO Market Size in 2024

The agrochemical sector is highly competitive, with numerous domestic and international players vying for market share. Navigating the complex regulatory landscape for agrochemicals, including stringent approvals and registration processes, can be time-consuming and costly.

For example, some of the established companies like BASF and Bayer face stiff competition from local firms, such as Rallis India, which can offer cost-effective solutions. This intense competition pressures margins and requires continuous innovation.

Keeping pace with rapid technological advancements in agrochemical formulations and production techniques can be challenging, particularly for smaller players. For example, smaller CDMOs struggle to invest in advanced technologies, such as precision agriculture solutions, whereas larger firms like Syngenta are increasingly integrating into their product lines.

Major Key Players of Agrochemical CDMO Market

• UPL Limited 

• PI Industries 

• Rallis India Limited 

• Bharat Rasayan Limited 

• Syngenta India Limited 

• BASF India Limited 

• Bayer CropScience Limited 

• FMC India 

• Insecticides (India) Limited 

• Shree Ram Agro India Limited

Future Trends and Outlook

There is a growing shift towards sustainable and organic farming practices, which is driving demand for bio-based agrochemicals, including biopesticides and biofertilizers. 

Companies will increasingly invest in developing eco-friendly products that comply with international standards, enhancing their export potential. For instance, the Indian government has increased its focus on organic farming, with a target of achieving 26 million hectares of organic farmland by 2025. This initiative aims to promote sustainable agricultural practices across the country. 

Innovations in biotechnology and genomics are leading to the development of more effective and targeted agrochemical products. For instance, In September 2024, BASF announced its investment in digital farming technologies to enhance crop management through precision agriculture solutions. 

The integration of precision agriculture technologies, such as drones and IoT, will allow for more efficient use of agrochemicals, optimizing yields and minimizing environmental impact.

Regulatory Scenario in Agrochemical CDMO Market in India

For the purpose of maintaining the security, effectiveness, and environmental sustainability of agrochemical goods, the regulatory framework in the Indian agrochemical CDMO (Contract Development and Manufacturing Organisation) industry is crucial. The landscape is changing as a result of growing environmental concerns, increased scrutiny of pesticide use, and the push for sustainable agriculture methods.

Central Insecticides Board and Registration Committee (CIBRC) body operates under the Ministry of Agriculture and Farmers' Welfare and is responsible for the registration and approval of pesticides in India. The CIBRC evaluates the safety and efficacy of agrochemical products before they can be marketed.

Key Highlights:

In February 2024, The Pesticides Manufacturers & Formulators Association of India (PMFAI) has presented Nadir Godrej, Chairman and Managing Director of Godrej Industries Limited (GIL), Chairman of Godrej Agrovet Limited (GAVL), and Chairman of Astec LifeSciences Limited, with the Lifetime Achievement Award. He highlighted the group's dedication to the agrochemical and CDMO sectors, as well as their commitment to innovation and collaborating with multinational corporations. This accolade recognises a lifetime of outstanding work and adds to Godrej's long history of pioneering achievements in the agriculture industry.

According to recent research article by Godrej Astec, Astec LifeSciences, a subsidiary of Godrej Agrovet (GAVL), today launched its new advanced research and development (R&D) center in Rabale, Maharashtra. Named the ‘Adi Godrej Center for Chemical Research and Development’, the facility will focus on leading-edge innovation and developing sustainable and safe solutions for people and the environment and providing services to innovator companies in contract development and manufacturing space (CDMO).

According to AGC Inc., report AGC, a world-leading manufacturer of glass, chemicals, and high-tech materials, has announced that AGC Wakasa Chemicals Co., Ltd., a subsidiary of AGC that conducts CDMO* for synthetic agrochemicals and pharmaceuticals, held a ceremony on November 17, 2023 for the completion of a new large-scale production line at its Kaminaka Plant.

In March 2023, Agri solutions provider Coromandel International plans to expand its operations in crop protection chemicals and foray into Contract Development & Manufacturing Organisation (CDMO) business. The Board of the company approved the plan to diversify into new growth areas namely speciality and industrial chemicals.

In October 2022, Safex Chemicals India Limited (Safex), a fast growing Indian agrochemicals company, announces the acquisition of Briar Chemicals (Briar), the UK’s leading agrochemicals Contract Development and Manufacturing Organisation (CDMO) provider, from the pan-European alternative investment firm AURELIUS Safex is backed by ChrysCapital, one of India’s largest private equity firms, which owns a significant minority stake in the business. Briar Chemicals, based in Norwich, is the UK’s leading agrochemicals CDMO solutions provider and serves the world’s most innovative agrochemicals companies. It was formed as a carve-out transaction from Bayer CropScience in 2012.

For more information on this Report,

Connect with Milind K at 

milind.k@prophecymarketinsights.com 

or direct line: +1 860 531 2574/+91-9975017086

This story was initially published in the 2024 India Focus. Download the magazine to read more stories.

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