The seed treatment market is projected to reach a value of USD 11.31 billion by 2022, at a CAGR of 10.82% from 2017 to 2022. The global market has been driven by the successful implementation of practices for sustainable agriculture, supportive regulations to encourage the research and production processes, and the rise in environmental concerns associated with excessive pesticide use across the globe. This has promoted the growth of the market, particularly in China, India, Australia, and Argentina.
Increasing investments in R&D capabilities of the key players for the development of treated seeds, along with the increased expenditure in identifying seed treatment through cost-effective active ingredients, are expected to change the business landscape over the next five years. There is a high scope of development in the application of seed treatment in controlled-release technologies. The precise targeting of pesticides applied to the seeds, coupled with the reduced amount of pesticide requirement in comparison to the foliar sprays are the major factors encouraging the adoption of this technology among a majority of the farmers.
Seed treatment as a low-cost crop protection solution
Seed treatment is one of the most popular chemical crop protection methods available today. It provides better crop establishment, that is, healthy germination and protection against seed-borne and soil-borne diseases at a relatively low cost than spraying, thereby ensuring the salability of the harvest. A relatively small amount of active ingredients is required to protect the seedling against a wide variety of fungal diseases and pests.
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With rising concerns regarding crop protection, productivity, and yield, expenses on crop protection have significantly increased. Crop protection is the second-highest expense after fertilizers in farming. These expenses can be reduced through seed treatment as the volumes required are less as compared to foliar or furrow application. Due to the limited seed surface area, not only are the active ingredients required in limited quantities, but also are effective enough to control early seed diseases to a large extent. As compared to surface application of crop protection products, the loss is significantly reduced by 99% with the help of seed treatment.
Also, genetically modified (GM) seeds with target protection against specific pests are found to be more expensive than seed treatment. Hence, seed treatment is a more cost-effective solution than using GM seeds for crop protection in highly regulated GM countries.
Companies offering seed treatment products are required to comply with different regulatory guidelines, globally. Crop protection products, including the ones used for seed treatment, require several approvals by different regional bodies before they can be commercialized and made available for public usage. Although there are very specific legislatives to regulate the marketing of commercial seeds and crop protection products, seed treatment products are not governed by any distinct laws. In most countries, seed treatment products follow the same registration process as other conventional agrochemicals. Biological active ingredients, especially biopesticides, are considered under crop protection, and similar regulatory procedures are adopted to enter the market for commercialization.
For example, The Fertilizers Act and Regulations stands as the federal legislation governing the sale and importation of fertilizer and supplement products in Canada. In this case, supplements include any substance or mixture of substances that are used to improve the physical condition of the soil or to aid plant growth and crop yield. However, no specific regulatory guidelines or testing procedures are laid down for biofertilizers utilized in seed treatments, which make it all the more challenging for companies to launch new products. Additionally, the R&D investment risks involved in the development of effective microbial strains can result in limited product launches in the next five years. Longer registration periods and product approvals for chemical ingredients in European countries can also impact the product innovation process in the sector. In countries such as Brazil and the US, the product registration costs, approval time periods, and data requirements are acceptable enough for market players to launch their new products.
Based on crop type, the cereals & grains segment accounted for the largest share in 2016. This is attributed to the significant rise in agri-inputs usage on crops such as corn, wheat, rice, and barley in the US, China, Japan, and European countries. However, due to the increasing industrial value of soybeans and canola, the demand for seed treatment for these crops is also expected to increase. High-value crops such as vegetables are a niche market for seed treatment; however, this market has been witnessing a steady growth owing to the growing number of products for vegetables in the market.
On the basis of type, the biological seed treatment segment is projected to grow at the highest CAGR from 2017 to 2022. At a global level, the market for biologicals is expected to witness significant growth, which in turn offers more opportunities for the manufacturers during the forecast period. The biological seed treatment segment is projected to witness the highest growth rate owing to the increasing awareness about the harmful effects of chemical pesticides, stringent government regulations regarding their use, and the ban on chemical usage (such as neonicotinoids) on the field posed in several regions, particularly the European Union. Developments are being studied upon to incorporate controlled-release technology by clubbing polymer coatings with treated seeds.
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On the basis of application technique, the seed dressing segment is projected to grow at the highest CAGR in the seed treatment market from 2017 to 2022. This method is suitable for the uniform application of pesticides and is increasingly adopted by farmers, owing to the associated benefits. Seed pelleting accounts for a minor share in the market as it is a sophisticated method; it is mainly applied for treating vegetable seeds.
Asia Pacific is projected to be the fastest-growing market for seed treatment between 2017 and 2022. Asia Pacific is a key market for seed treatment as the region’s economy is heavily dependent on agricultural outputs and the trade of agricultural commodities. Trade barriers are hence expected to cause trade scarcity, which is a serious issue for Asian trade blocs. To improve agricultural trade, there is an increased necessity to maintain the yield, and hence there has been an increasing focus on seed treatment to maximize the yield of crops such as cereals and oilseeds. Key players focus on research & development to innovate products conforming to regulations, which form the basis for the demand of seed treatment in markets such as South America and Asia Pacific.