The agricultural micronutrients market is estimated to reach USD 5.83 Billion by 2017, and it is projected to reach USD 8.81 Billion by 2022, at a CAGR of 8.60% from 2017. In terms of volume, the market is projected to reach 1,681.1 KT by 2022. This market is growing in accordance with the increasing soil deficiency and increasing demand for biofuels.
How is the increase in contract farming in various countries presenting growth opportunities for manufacturers in the agricultural micronutrients market?
Major food processing players have adopted the strategy of backward integration to gain raw materials of assured quality, quantity, and price benefits. In contract farming, companies provide the requisite agricultural inputs. Companies carry extension programs to educate farmers. They also perform land preparation in which soil testing is conducted. Farmers are provided with micronutrients to enhance the quality and productivity of output. Integrated nutrition is an important part of contract farming across the world. The major market participants in contract farming are PepsiCo, Punjab Agro Industries Corporation in India, Indu-Farm (EPZ) Limited in Kenya, Coffee Board of Zambia, and Coffee Growers Association in Zambia. The increase in contract farming is expected to further drive the usage of agricultural micronutrients.
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Increase in soil deficiency
Since the last two decades, micronutrient deficiencies in the soil have been increasingly evident, especially the deficiency of zinc and boron. Zinc micronutrient deficiencies are witnessed across the globe; however, they are more common in growing economies such as India, Brazil, and China. Excess application of inorganic fertilizers is one of the major reasons causing soil deficiencies. Originally, soils are deficient in one or more micronutrients; however, increased intake of nutrients by high-yielding crops has caused a heavy shortage of micronutrient elements (iron, manganese, zinc, copper, boron, nickel, and molybdenum). According to the International Fertilizer Association (IFA), currently, almost 50% of the world’s cereal crops are deficient in zinc, which is leading to poor crop yields. Zinc deficiency is the fifth leading risk factor for diseases in developing countries. A decreased uptake of micronutrients due to interaction with other soil components and an increased demand for high-yield crops are the two major reasons for micronutrient deficiency. Intensive usage of fertilizers, chemicals, and farm irrigation is responsible for reducing the level of micronutrients in the soil. Reduction of the supply of micronutrient to crops reduces productivity and damages the quality of crops. To maintain the nutrient level in crops and soil, micronutrient plays an important role, which in turn drives the market growth for agricultural micronutrients.
The agricultural micronutrients market is concentrated, with leading companies driving market growth. The report provides qualitative analysis of the prominent market players and their preferred development strategies. Key players such as BASF (Germany), Dow Chemical (US), AkzoNobel (Netherlands), Agrium (Canada), Yara International (Norway), The Mosaic Company (US), Land O’Lakes (US), Helena Chemical Company (US), and Nufarm (Australia) have been profiled in the report. These leading players have adopted various strategies such as expansions, mergers & acquisitions, new product launches, and joint ventures/agreements to explore new and untapped markets, expanding in local areas of emerging markets, and developing a new customer base for long-term client relationships. This has not only enabled the key players to expand their geographical reach but has also reinforced their market position by gaining a larger share in terms of revenue and product portfolios.
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Small-scale players have also adopted these strategies to expand their businesses globally by investing in the establishment of manufacturing facilities and technical service centers in various regions. This inorganic growth strategy enables them to improve their technical expertise through intensive R&D infrastructure offered by bigger players.