GLOBALSEED TREATMENTMARKET

Market Shares, Forecasts& Trends

2014 - 2019

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1. GLOBAL MARKET OVERVIEW

1.2 Seed Treatment: A Current and Future Perspective

Though the global population has been witnessing steady growth over time, the per capita farmland has been

declining at alarming rates. For instance, it is expected that the 8.3 billion-strong global population by 2030 would

have a mere 1,800 m2 of farmland on a per capita basis. Higher demand for crops in the future offers the greatest

potential for innovating in the field of plant biotechnology, with crop protection and breeding technologies already

being under investigation. In contrast, the future potential for innovation in fertilizers, mechanization and land

utilization is the least, with the latter being more pronounced due to dearth of adequate arable land. While seed

treatment is not the be all and end all solution for agriculture’s pest and pathogen problems, it definitely

constitutes a major tool and the starting point in mankind’s quest for increasing crop production. The current

tight supplies of food globally have ensured that the production of food has to double from existing levels by

2050 if the growing population has to be sustained.

1.2.1 Current Trends in Seed Treatment

The market for seed treatment gains in significance due to a number of factors, prominent among which are

agronomic trends that comprise development of high quality seeds through the enhanced potential offered by

genetically modified organisms (GMOs), changes in climactic conditions, increasing rates of crop rotation,

flexibility in sowing approaches and greater pressure from regulatory agencies. Primary requirements of seed

treatment include capability of offering good protection during the germination period, supporting early plant

development and enhancing stress tolerance at an early stage. These can be achieved by improving the quality of

seed treatment products that offer ease of application at low rates. In short, it may be summed up that the

foundation for the future lies in the concept of innovation in seed treatment.

Seed treatments have been recording impressive growth in utilization because of several aspects, which include

the following:

Improvements in seed treatment active ingredients

Alteration in farming practices resulting in the planting of seeds earlier in soils that are frequently cold or wet

for maximizing yield potential

Higher costs of inputs necessitating maximizing crop production, conveying the import of every seed to grow

Enabling in protection of the seed from planting through early season against damage caused by a variety of

pests

Below-ground pest control after planting not having recourse to any rescue treatment, thereby requiring pre-

planting treatment

1.2.2 What the Future of Seed Treatment Holds

The greatest prospects for seed treatment lie in maximizing the plant’s generic potential through bespoke

solutions, which need a combination of crop protection, innovation and crop solution techniques. Of these, the

first encompasses conventional techniques of foliar and seed disinfection, the second involves existing

techniques for enhancing seed vitality through innovative application technologies and the third covers crop

management through using innovative technology for genetics/traits. This can be further represented as under:

Yesterday Basic protection Seed disinfection

Today Broad spectrum Broader pest and disease control and product combinations

Tomorrow Complete solutions Multi-compound products and complete spectrum of pest and disease

control offering seed vitality, stress tolerance, nutrition, higher treatment quality and improved application

1.3 Seed Statistics

Estimated Value of the Domestic Seed Market in Top 10 Countries for the year 2012 (In US$ Million)

(Source: International Seed Federation, www.worldseed.org)

Demand for seed treatment in the United States is projected to reach US$X.X billion by 2020 from an estimated

US$X.X billion in 2014 at a CAGR of X.X% between 2014 and 2020. Chemical agents account for the larger share

among the two major application segments of seed treatment in the region, within which insecticides is the

largest and fungicides the fastest growing. On the other hand, the United States market for biological seed

treatment agents is slated to record the fastest 2014-2020 CAGR of X.X% in reaching a projected US$XX.XX

million by 2020 from an estimated US$XX.XX million in 2014. By crop type, though corn/maize ranks as the

number one crop for seed treatment procedures in the United States with an estimated 2014 share of XX%,

demand for the same is likely to be the fastest in canola at a CAGR of X.X% during 2014-2020.

Value (In US$ Million)

1.6 Global Market Overview of Crop Type by Region

1.6.4 Rice

The worldwide market for seed treatment in rice is projected to reach US$207 million by 2020 from an estimated

US$145.3 million in 2014 by recording a CAGR of 6.1% between 2014 and 2020. North America is the largest

global market for seed treatment in rice, accounting for an estimated 2014 share of 35.9% and a forecast 2014-

2020 compounded annual rate of 4.9%. Demand for rice seed treatment in Asia-Pacific is likely to emerge as the

fastest growing with a compounded annual rate of 8.5% during the similar analysis period.

Global Market for Seed Treatment in Rice from 2010-2020 (In US$ Million)

2010 2011 2012 2013 2014 2020

Asia-Pacific

2.3 Seed Treatments on Select Crop Types

2.3.3 Oats, Wheat and Barley

Small grains, such as oats, wheat and barley are liable to be infected by various types of smut, which results in

loss of yield. Stinking smut, or common bunt of wheat, has a “fishy smell” that spreads from infected kernels to

healthy kernels. If the level of smut is very high, the smell passes on to the flour, which then cannot be used for

baking purposes. Animals, too, refuse consuming wheat that contains common bunt.

Controlling smut in small grains can be achieved by the application of numerous systemic seed treatment

fungicides available in the market. These seed treatments used for controlling smuts have enabled breeders of

small grains to focus on increasing yield and improving quality of baking in place of breeding for resisting smut.

The following table lists out the various fungal diseases and insect damages in wheat and the relevant seed

treatments to overcome them:

Basic Protection for Fungal Diseases and Insect Damages in Wheat

Type of Infestation Seed Treatment Option(s)

Fungi: Phytium, Rhizoctonia, Ustilago nuda, Tilletia controversa, Fusarium spp., and Microdochium nivale

Azole. Carboxime and Thiram

Insects: Wireworm, Hessian fly and aphids Neonicotinoid

Products with a Broad Range of Efficacy for Fungal Diseases and Insect Damages in Wheat

Type of Infestation Seed Treatment Option(s)

Fungi: Microdochium nivale, Fusarium spp., Ustilago nuda, Septoria nodorum and Tilletia caries

Azole. Prochloraz, Fludioxonil and Strobilurin

Insects: Aphids, wireworm, cicada and wheat bulb fly Neonicotinoid

3. MARKET DRIVERS, RESTRAINTS AND OPPORTUNITIES

3.1 Major Drivers for the Seed Treatment Market

3.1.2 Price and Weather Volatility

By nature, farmers tend to be highly averse to taking risks. Further, since weather and crop prices are highly

volatile, the risk factor for farmers increases quite drastically. This results in focusing greater attention on

procedures that reduce risk, such as adapting to weather conditions after sowing, which makes seedlings highly

vulnerable to soil-borne diseases and insects. However, this limitation can be successfully overcome by adopting

pre-sowing seed treatment practices that increase resistance to diseases and pests, thereby driving the market

for seed treatment.

3.1.5 Greater Use of Multi-Component Products

One of the major driving factors for the seed treatment market has been the availability and greater utilization of

a single product that offers multi-component features covering an extensive range of insects and diseases.

Demand for hybrid seeds is also on the rise, more so in Europe, Brazil and the United States, since they lend

themselves better to seed treatment methods. This creates greater opportunity for either including or offering

seed treatment as an effective option for controlling pathogens and pests.

3.2 Key Factors Restraining the Seed Treatment Market

3.2.3 Limited Dose Capacity

The quantity of pesticide that can be applied is limited by the factor as to how the much of the material will

actually adhere to the seed. Though the development of seed coating technologies is helping in overcoming this

problem, the issue of phytotoxicity could still be a restraining factor.

3.2.4 Limited Duration of Protection

In several instances, the duration of protection offered by seed treatments is short because of the comparatively

less amount of chemical applied to the seed, dilution of the chemical as the plant grows and breakdown of the

chemical. Any such experience undergone by farmers acts as a deterrent for future applications of seed

treatment.

4. REGIONAL MARKET ANALYSIS

4.1 NORTH AMERICA

The North American market for seed treatment is estimated to be US$ XX.XX billion in 2014 and forecast to

maintain a CAGR of X.X% between 2014 and 2020 to reach a projected US$X.X billion by 2020. With an estimated

share of XX.XX% in 2014, the United States constitutes the largest market for seed treatment in North America,

though the fastest CAGR of X.X% during 2014-2020 is anticipated to be recorded by demand for seed treatment

in Mexico.

By application segment, chemical agents dominate the North American market for seed treatment, accounting for

an estimated 2014 share of XX.XX%. However, growth in demand for biological agents is likely to outpace

chemical agents by posting a 2014-2020 compounded annual rate of 7.6% to emerge as the fastest segment.

Corn/maize is the leading type of crop for seed treatment applications in North America, estimated to account for

XX.XX% of the total demand in 2014. In terms of CAGR between 2014 and 2020, however, demand for seed

treatment applications in canola is expected to be the fastest among all crop types at X.X%.

North American Market for Seed Treatment by Region from 2010-2020 (In US$ Million)

Region 2010 2011 2012 2013 2014 2020 % CAGR (2014-2020)

United States XX XX XX 1,030.00 XX XX XX

Canada XX XX XX XX 58.03 81.24 XX

Mexico 64.22 67.65 XX XX XX XX XX

Total XX XX XX XX XX XX XX

4.1.1.1.1 Major Markets for US Seed

4.1.1.1.1.1 Africa

The overall market value of the US seed industry for the Africa as delineated by the USDA stood at US$14.5

million in 2007 and reached US$20.4 million in 2011 to reflect a CAGR of 8.9% between these years.

4.1.1.1.1.9 India

Exports of planting seeds from the US to India declined by 2% over 2011 to stand at US$8.8 million in 2012.

However, between 2010 and 2011, there was an increase of 27% in seed exports from the US to India, and the

period from 2005 witnessed a net increase of exports to this market.

5. MARKET SHARE ANALYSIS

Syngenta and Bayer are the clear leaders in the global market for seed treatment, with a combined share

estimated to be nearly 61% in 2013. In fact, the high level of concentration exhibited by the seed treatment

market is evident from the fact that the top four players account for a share in excess of 80% in 2013.

Market Share of Leading Players in the Global Seed Treatment Market for 2013

Despite being engaged in the food and farming sectors for several decades, these multinationals have been able

to achieve the present levels of consolidation and control only over the last 10-20 years. This has been the

outcome of mixing and matching a range of approaches, which include the following:

Mergers and Acquisitions: A tried and tested practice adopted by virtually every industry at some point of

time, M&A activity in the pesticides industry has witnessed the top six companies embark on a spending

spree since the 1990s with a focus on taking over the three major segments of the agriculture industry, viz.,

pesticides, seeds and biotechnology for developing a proprietary family of chemicals, seeds and genetic traits

that have been formulated to work in tandem.

Cooperative strategies among the few close competitors

Vertical integration upward along the food chain by setting up food chain clusters

Syngenta

Monsanto

These strategies have enabled the leading players to remain leaders, who have taken over smaller players and

integrated their businesses into their own portfolios.

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