With just 9 months to
go until China’s ban on paraquat AS comes into effect, diquat AS appears to be
well placed to fill the gap in the market. But diquat could also be vulnerable
to a similar ban. CCM examines the
risks and opportunities for China’s diquat market in 2016...
Background: the ban
on paraquat AS
Paraquat
is the second most popular herbicide in the world, but it is highly toxic and
studies have found that ingesting just 3 grams of it can cause failure of the
liver, kidney and other organs, fibrosis of the lungs and respiratory failure.
There is no known antidote.
Due
to the relatively high risk of accidental ingestion, aqueous solutions (AS) of
paraquat have been banned in over twenty countries worldwide, including
Australia, Germany, the UK and Malaysia, and now China is following suit.
Producing
paraquat AS for the domestic market was made illegal on July 1, 2014, and on
July 1, 2016 the sale or use of paraquat AS will also be outlawed. China’s
Ministry of Agriculture also re-classified paraquat as a highly poisonous
substance on July 28 this year.
Paraquat
is a huge industry in China, so the fallout from the ban will be significant.
According to CCM’s research, China produces 150,000 tonnes of paraquat per
year, and it is also the main downstream market for related products such as
pyridine, over 200,000 tonnes of which is produced in China each year.
Though
only 20,600 tonnes of this paraquat was consumed in China, with the other
130,000 tonnes being exported, the ban will still leave a significant gap in
the market.
“We
estimate that sales of paraquat products in China will halve following the ban
on paraquat AS,” said Li Zhonghua, Secretary General of the China Crop
Protection Industry Association (CCPIA).
This
would reduce consumption by over 10,000 tonnes, handing manufacturers of
substitute herbicides a big opportunity.
Diquat as a substitute
for paraquat: the positives
The close similarities between diquat and paraquat
make diquat an excellent like-for-like substitute for paraquat. The substances
are both dihydropyridines
herbicides and non-selective contact herbicides, and are both main competitors to
glyphosate in the non-selective herbicide market.
Diquat is also more effective as a weedkiller than
other substitutes such as glyphosate and glufosinate-ammonium, an though it is
not quite as effective as paraquat, it has the advantage of being less toxic.
And it also very cost-effective compared to its
rivals. The
average ex-works price of diquat is about 5
times lower than glufosinate-ammonium TC (technical), according to CCM’s
research, and Chen Zaoqun, Editor of Herbicides China News believes
that this is unlikely to change in the near future:
“Due
to Chinese manufacturers’ limited production technology, the price of
glufosinate-ammonium is unlikely to reduce significantly even as production
capacity expands,” commented Chen.
Though
diquat TK (technical concentrate) is twice as expensive as glyphosate, glyphosate
resistance is becoming an increasingly serious problem around the world and
many farmers are turning to diquat since it has no equivalent resistance
issues.
The
attention Chinese manufacturers are paying to diquat testify to its strengths
as a substitute for paraquat. Several major manufacturers have promoted new
diquat formulations this year, including Nanjing Redsun Co., Ltd., Zhejiang
Yongnong Chem. Ind. Co., Ltd. and Shandong Luba Chemical Co., Ltd. Of these,
Nanjing Redsun’s launch of Fanchu - a 20% diquat cation AS sterilant herbicide -
is particularly noteworthy since it appears to be specifically aimed at
capturing the paraquat market.
Not
only is diquat similar chemically to paraquat, even its registered formulations
closely match its rival. Approximately 90% of paraquat’s formulation
registrations in China are AS, while for diquat the figure is 100%, according
to China’s Interstate Compact on Adoption and Medical Assistance (ICAMA).
“It
may be the end of an era for paraquat after the ban comes into force,”
commented Chen. “Diquat will gain a large development potential in the domestic
market [following the ban on paraquat AS], which was previously occupied by
paraquat.”
Diquat as a
substitute for paraquat: the negatives
Although
diquat has a lower toxicity than paraquat, toxicity is still one of the similarities
between the two products and could be a problem for diquat going forward.
Indeed,
the toxicity of diquat is highly contentious, especially following the Ministry
of Agriculture’s decision to list paraquat, but not diquat, as a highly
poisonous herbicide. Despite the similarities between the two substances,
diquat was labelled ‘low-toxicity’ and ‘medium-toxicity’.
According
to reports from agrichem.cn, experts
inside the Shandong Provincial Department of Agriculture also considered
including diquat in the Catalog of High-Risk Pesticides when they were
compiling the Catalog in late August.
Had diquat not escaped inclusion, the consequences
could have been severe, according to Chen:
“If
diquat had really been listed in the Catalog, the Ministry of Agriculture would have immediately tightened its
supervision of diquat according to China’s laws on high-toxicity pesticides,”
said Chen “There would also be a high risk of diquat AS being banned
altogether, as in the case of paraquat. Since all of diquat’s registered
formulations are currently AS formulations, this would be mean the end of
diquat in China.”
“There is still a risk that the toxicity level of
diquat may be revised upwards in future,” Chen added.
Need more information
about China’s herbicides market?
If
you are looking for more detailed intelligence on China’s diquat market, take a
look at some of CCM’s latest research below:
Trade Data - you can
find detailed data on every Chinese diquat supplier and trader, and what
specifications and prices they are offering, in our Import /Export Analysis reports
Newsletter - for
breaking news, data and expert commentary on China’s herbicides market,
download the latest issue of Herbicides China News
Market Data - get
regular updates on the price, production, consumption, manufacturing costs and
leading producers of diquat in China with our Market Data service
Claim your free trial of CCM Agrochemicals
CCM
Agrochemicals gives you access to the most comprehensive intelligence on China’s
pesticides market available anywhere at an extremely competitive price.
Subscribe
to CCM Agrochemicals to get access to:
-
Monthly price data for 99 pesticide
products
-
Access
to all 7 of our agrochemicals market Newsletters
-
15 years of historical data
-
Free consultations with our research team
To try out CCM
Agrochemicals free for seven days, sign up here: www.cnchemicals.com/Page/membership/applyMembership.aspx
About CCM:
CCM
is the leading market intelligence provider for China’s agriculture, chemicals,
food & ingredients and life science markets. Founded in 2001, CCM offers a
range of data and content solutions, from price and trade data to industry
newsletters and customized market research reports. Our clients include
Monsanto, DuPont, Shell, Bayer, and Syngenta. CCM is a brand of Kcomber Inc.
For
more information about CCM, please visit www.cnchemicals.com or get in touch with us
directly by emailing econtact@cnchemicals.com or calling +86-20-37616606.