Agrochemicals are designed to protect crops from insects, diseases, and weeds. It has been a major contributor in making any country self-reliant in food production. The use of agrochemicals primarily aims to ensure abundant food supply for humans, but it may have a negative impact on soil biological activity and diversity through direct or indirect actions.

According to Mordor Intelligence, the India Agrochemicals Market size is estimated at USD 8.22 billion in 2024, and is expected to reach USD 13.08 billion by 2029, growing at a CAGR of 4% during the forecast period (2024-2029). The rising population in India, accompanied by rising affluence, is creating a shift in consumption patterns. There is a need to not just increase production to meet demand but also to ensure that the nutritional needs of an increasingly affluent population are met. Shrinking arable land and loss of crops due to pest attacks lead to wastage, posing a critical challenge to ensuring food and nutritional security.

The demand for agrochemicals is growing due to demand for food supply in order to meet the needs of a growing world population from 8 billion to 9.8 billion in 2050 and 11.2 billion in 2100. The global market is predominantly driven by the increasing demand for crop protection products in the agricultural field across the globe. Growing food demand, increasing adoption of precision farming methods, shrinking arable land due to increasing population, and rapid urbanization & industrialization across the globe are some also among the key factors driving the market.

Approximately 25% of the world crop output is lost every year due to diseases and attacks by pests & weeds. Hence, agrochemicals play a vital role in enhancing crop yield and production. In India, about 15-25% of potential crop production is lost due to pests, weeds, and diseases. The need for improving crop productivity with a focus on the effective use of pest control measures and the adoption of weed management practices has been recognized as an important factor in increasing agricultural output. These factors are aiding the use of agrochemicals in agriculture to increase output

Indian agrochemical industry has experienced significant growth over the past few years, fueled by rising demand for food and increasing adoption of modern farming techniques. India ranks fourth in the world in terms of agrochemical production. India agrochemicals market size is expected to grow from US $7.90 billion in 2023 to US $12.58 billion by 2028, at a CAGR of 9.75%.

According to WTO, India has emerged as the 2nd largest exporter of agrochemicals in the world after China. Agrochemicals export from India reached a new peak of US $5.5 billion for FY 2022-23, up from US $2.6 billion in FY 2017-18. One of the key drivers of growth in the Indian agrochemical industry is the increasing awareness among farmers regarding the benefits of using agrochemicals for crop protection and yield enhancement. In addition, the government's push towards sustainable agriculture has led to a rising demand for eco-friendly and bio-based agrochemicals.

The industry is also witnessing an increasing focus on R&D. Several companies are investing in new and innovative formulations that are more effective, ecient and environmentally friendly. There is also an increasing focus on precision agriculture and the use of smart agrochemicals for optimizing crop management.

The Indian agrochemical industry faces several regulatory challenges. The lack of a level playing field in the global market makes it challenging for Indian companies to compete. The industry is facing tough competition from low-cost imports from other countries. Moreover, India's agriculture sector remains largely traditional, with limited technology adoption, which results in low yield, poor quality, and high dependence on agrochemicals. There are environmental concerns as the farming community in India is primarily dependent on the use of chemical fertilizers and pesticides.

Along with challenges, Indian agrochemicals industry is witnessing huge growth opportunities due to increasing demand, proactive government policies and emerging export market etc. The government has taken several measures to promote the growth of the agrochemical industry in the country. Initiatives such as the Pradhan Mantri Fasal Bima Yojana and the Soil Health Card Scheme have been launched to support agriculture and increase the demand for agrochemical products.

The agrochemical industry has the potential to tap the emerging export market, primarily in Africa, Southeast Asia, and South America. Advancements in technology, such as precision farming and biotechnology, present new opportunities for the Indian agrochemical industry to improve productivity, enhance quality, and reduce the dependence on agrochemicals.

Overall, the Indian agrochemical industry faces several challenges, but there are significant opportunities for growth, provided the industry players focus on sustainable practices, technology adoption, and environmental-friendly practices.

Outlook:

Overall, India’s agrochemicals industry is on a positive growth trajectory, supported by government initiatives, increased production capacities, and innovation. The country has the potential to become a major player in the global agrochemical market, driven by its focus on domestic manufacturing and the development of high-quality, cost-effective products. Near term demand looks positive as trends is summer sowing are looking highly upbeat. According to a latest update from the Reserve Bank of India (RBI), as of May 10, 2024 75.9 lakh hectares of the summer crop area have been sown, registering an increase of 8.9% over a year ago, with higher acreage under rice, pulses, coarse cereals and oilseeds.

Financial Performance of Top Companies in sector: