Crop Protection Sales Trending Upwards For Top 100 Ag Retailers

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For the third straight year, the crop protection products category was the fastest growing segment for the top 100 largest agricultural retailers in the U.S.

An old sports adage says that “two in a row is luck, three in a row is a trend.” Based upon this line of thinking, the crop protection products category has definitely shifted into trend territory.

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Since 2013, the nation’s CropLife 100 ag retailers have witnessed a re-birth in their crop protection product sales. Prior to that time, revenues for the category annually waxed and waned, but rarely kept pace with the rest of the tracked crop inputs/services that make up the CropLife 100 survey. This meant market share for the segment — which lead all categories during the early 2000s — steadily dropped from the mid-40% range to less than 30% as of 2012. At this time, many market watchers predicted that these percentages would fall even further as more and more crop protection chemistries were primarily replaced with a single product, glyphosate.

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Yet, a funny thing happened along the way — Mother Nature fought back. Starting in the early 2000s and continuing for virtually every year thereafter, the number of weed species that developed resistance to glyphosate and other popular herbicides gradually grew. By the start of the 2013 growing season, agronomists estimated that the number of farm areas infested with herbicide-resistant weeds had grown to more than 70 million.

Ag retailers also saw this problem becoming more acute for their grower-customers. In the 2014 CropLife® magazine survey, 41% of respondents indicated that herbicide-resistant weeds were a “major problem in many of the fields we service.” For the 2015 CropLife 100 survey, this percentage has grown to 51%.

Naturally, this increasingly difficult situation caused many grower-customers to re-evaluate their herbicide programs, adding new products to the mix in an attempt to regain weed control. “Growers understand the implications increasing populations of resistant weeds can have on their operations and are becoming more proactive by applying a full range of tools to fight resistance,” says Jeff Carpenter, corn and soybean herbicide portfolio manager for DuPont Crop Protection.

Another Strong Year

So with the weeds problem in full force, the crop protection products category as a whole has apparently benefitted. In 2013, sales for the category grew 8%. In 2014, crop protection product sales increased 9%.

And this year officially makes it a growth trend. For 2015, the crop protection products category led all others when it came to growth, topping $10.1 billion. Significantly, this marked the first time that the category has surpassed double-digit billions in revenue. This represented a healthy 8.6% increase from the $9.3 billion in sales the category recorded during the 2014 growing season. Better still, market share for crop protection products in the ag retail sales mix increased once again, growing from 31% in 2014 to 33% today.

Considering the kind of year 2015 ended up being in many parts of the country, this performance by the crop protection products category was particularly impressive. For much of the spring, excessive rains in many portions of the Midwest washed out the chances for ag retailers to apply products for their grower-customers.

Still, according to many market insiders, this meant that many of the diseases and crop pests that normally show up during the end of July or early August began appearing much sooner in the season. “Many leaf diseases in corn such as gray leafspot and Northern corn leaf blight are diseases that we typically don’t see popping up in fields in places such as Indiana and Illinois until closer to the end of July,” said Andrew Farrell, commercial agronomist for Mycogen Seeds at a Dow AgroSciences event. “But they showed up this year in early July.”

So overall, the sales of the three major segments of the crop protection products category — herbicides, fungicides and insecticides — all recorded nice gains for the nation’s top ag retailers. According to the 2015 survey results, herbicides had increased sales for 63% of respondents, down from 75% in 2014.

In contrast to this, the other two segments showed revenue gains among more ag retailers than in 2014. For fungicides, 54% of 2015’s CropLife 100 ag retailers had sales increases, up from 47% the year before. Likewise, insecticide sales were up for 49% of this year’s CropLife 100 dealerships and cooperatives. In 2014, only 45% of respondents could make this boast.

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