1. Glyphosate price rising steadily

During the 12th National Pesticide Seminar and Exhibition held in Shanghai on October 19-21, the exchange meeting discussed the trends of pesticide industry and export of pesticides in China. The overall pesticide industry, after the declining tendency from 2009 to 2011, boomed with a recovery in the beginning of this year. It is expected that, in 2013, the situation will remain optimistic.

Glyphosate October-November monthly price was RMB35,000-36,000/t (tax included). The average price in the fourth quarter is expected to increase by RMB 5,000-6,000/ton (tax included), compared with that in the third quarter.

From the fourth quarter of this year to the first quarter of next year, we hold an optimistic attitude that the price of glyphosate will keep high, while its upward trend and upward range will depend on the introduction and implementation of environmental policy.

2. Glyphosate industry after depth adjustment

After 3 years' depth adjustment, the supply and demand situation of glyphosate industry has changed: there emerges the upward trend of the industry.

Cause of a substantial increase in the planting area of transgenic crops, price of glyphosate soared from RMB23,000/ton in 2006 to RMB120,000/ton in 2008. Driven by such a high profit, domestic capacity of glyphosate production surged from 200,000 tons to nearly 1 million tons, which led to the serious excess of capacity in 2009 before the price falling sharply to RMB19,000/ton.

After this, glyphosate industry entered a three years' adjustment period when the industry shuffled and the supply and demand structure has undergone significant change. Since 2012, price of glyphosate started soaring with more than 50% increase from RMB24,000/ton in the beginning of the year to the current RMB37,000/ton. The prosperity of the industry has appeared.

3. Concentration of glyphosate industry has enhanced gradually

With tighter environment protection regulations, the concentrating glyphosate industry benefits large-scale enterprises with technological advantages.

The latest statistics show that, up to July 10, 2012, among the 130 domestic enterprises with glyphosate registrations. there are 17 (60% of total capacity) with capacity of no less than 10,000t/a each, 7 (40% of total capacity) of which with capacity of no less than 30,000t/a each.

Along with the increasing effort into domestic environment protection, smaller enterprises with smaller glyphosate production are bound to be eliminated or merged by leading enterprises with large scale and technological advantages. The degree of concentration of the industry will continue to be enhanced and help to improve the competitiveness of the leading enterprises.

4. Global transgenic crop area increases

The International Agricultural Biotechnology Application Service Organization, headquartered in the United States, said in a report: the global planting area of genetically modified crops has increased by 8% to 160 million hectares in 2011, compared with that in 2010.

The report said that there are 29 countries planting genetically modified crops last year, including 19 developing countries and 10 developed countries. Developing countries' transgenic crop acreage has increased by 8.2 million hectares, while developed countries 3.8 million hectares, respectively up by about 11% and 5%.

After the four years' downturn, the actual demands of global glyphosate pesticide this year has raised to more than 700,000 t, maintaining a growth rate of approximately 10%. Glyphosate inventory, meanwhile, has continuous price-raising potential.