The total sales of domestically produced pesticides in 2022 exceeded the figures for 3 by 2021% and reached 119 thousand tons, according to the Russian Union of Producers of Chemical Plant Protection Products (RSP KhPZR). Including 73 thousand tons were herbicides, 13,3 thousand tons - fungicides, 9,5 thousand tons - insecticides, 4,5 thousand tons - seed disinfectants. Among Russian companies, according to the Soyuz, the leading position was taken by JSC Firm "August". In general, the participating organizations of the RSP KhPZR met the needs of domestic farmers by more than 50%. The total volume of the Russian market at the end of the year amounted to 230 thousand tons. In 2023, the vast majority of contracts for the supply of plant protection products have also already been executed, and, according to preliminary forecasts of the RSP KhPZR, when summing up the annual results, an increase in sales of domestic pesticides by 5-10% can also be recorded.
In the medium term, trends in the Russian pesticide industry will largely be determined by state policy in this area: for example, the introduction of quotas for the import of finished imported drugs, which is being considered today, will stimulate the production of domestic CPPPs with the possibility of replacing the products of foreign companies in the horizon of 2-3 years. According to the RSP KhPZR, Russian production facilities are capable of producing up to 380 thousand tons of drugs per year in total, and this potential is currently being used to expand export opportunities. It is noteworthy that, despite the difficult geopolitical situation, the growth of export shipments of pesticides in comparison with the previous season amounted to almost 20%. Also, quotas for CPPP imports will stimulate the localization of the production of drugs by multinational companies in the Russian Federation.
Another factor that will affect the supply and price dynamics in the domestic CPPP market is the state of the chemical industry in China, since it currently provides key raw materials - active ingredients - for about 2/3 of the world production of pesticides. Today, the price environment for the end consumer - farmers - is rather favorable, however, a number of internal contradictions have emerged in this production segment of China.
“From the autumn of 2022, a sharp drop in prices for many raw materials began in the PRC, which continues at the present time,” says Valery Reshetnyak, head of the department for foreign economic activity of Firm August JSC. – There is a correction after last year's rise in the cost of active substances, when Chinese manufacturers created significant raw material reserves in order to increase sales and earn more, in other words, there was an overproduction of raw materials for the production of KhPZR. The 2022 drought in South America also affected the market, as countries sharply reduced pesticide consumption.”
Against this background, the strengthening of ties between Russian and Chinese industrialists plays an increasingly important role. Thus, at the international exhibition of agrochemical equipment and plant protection products CACE-2023, held in China, a meeting was held between representatives of the RSP KhPZR and the leadership of the state subordinate institution of the Ministry of Agriculture of the People's Republic of China - the Institute for Controlling the Circulation of Agrochemicals (ICAMA). The participants of the event confirmed the stable positive dynamics in the trade turnover between the Russian and Chinese industries and came to a common opinion on the need to accelerate the pace of cooperation.