The Latest Acquisitions Prove the Biologics Market’s Resistance  

On October 6, 2020, Syngenta Group announced the acquisition of Valagro, a leading biologicals company, by its business unit, Syngenta Crop Protection. This investment positions Syngenta Crop Protection as one of the key global companies poised to shape the rapidly growing biologicals market. This market is expected to nearly double in size over the next five years. Valagro will continue to operate as an independent brand in the market within the Syngenta Crop Protection business.

Valagro is a market-leading producer of innovative biologicals, with a 10% compound annual growth rate (CAGR) between 2009 and 2019 and an approximate revenue of USD 175 million in 2019 The company has excelled by harnessing the power of nature to provide innovative and effective solutions for plant nutrition and care. With 40 years of experience, Valagro offers its customers a comprehensive crop portfolio in biologicals, with a market-leading position in biostimulants and specialty nutrients. Headquartered in Atessa, Italy, Valagro serves customers around the world, with a strong presence in Europe and North America, as well as a growing footprint in Asia, including China, and Latin AmericaValagro has over 700 employees, 13 subsidiaries, and eight production sites around the world, with a portfolio backed by best-in-class biological R&D, production, and commercialization capabilities 

 The increase in the number of mergers and acquisitions is seen as a strategy adopted by leading companies in the industry to reduce risks and uncertainties in the agrochemicals market. This is because a discovery in the biotechnology field can render a complete product line in the sector unfeasible. By acquiring companies with expertise in biotechnology, the leading companies expand their technological base, diversify their production process, and increase their competitiveness and market share.  

On a global scale, Brazil was the leading biostimulants market in 2019, followed by Germany and France. The global biostimulant market is projected to grow at a CAGR of 9% over the next five years, reaching nearly USD 2.2 billion by 2024. This represents the largest growth occurring in Latin America, at a CAGR of 13.5%. 

Among the factors behind the rapid growth of the biostimulants market are the increasing environmental stresses due to adverse weather effects associated with global warming (e.g., droughts, floods, and strong winds). 

Biostimulants, in improving the uptake of nutrients and root development, help to boost a plant’s ability to withstand these abiotic and biotic stressesThe result is higher crop yields, which contributes to the achievement of the global goal of improved food security, especially for developing nations. Another factor behind the growth of the biostimulants market is the changing regulatory framework, which will help promote and develop the use of biological inputs for farmers. The biostimulant industry currently is not well regulated, with a lack of clear definitions for products. Europe is set to lead the way in changing this lack of clarity by introducing new guidelines by 2022.   

The growth prospects are enormous, with both existing products and those that are expected to be launched in the coming years; currentlythe market size is still small.    

In an effort to realize the potential of this market, large agrochemicals companies are increasingly focusing on opening biological control lines, with one frequent strategy being the acquisition of specialized manufacturers.   

In addition to Syngenta’s recent acquisition of Valagro, American Vanguard Corporation announced that its subsidiary, AMVAC Chemical Corporation, had acquired the Agrinos group of companies. Agrinos is a privately owned technology leader in biological crop inputs. Like Valagro, Agrinos offers many plantnutrient products, with significant sales in the United States and Brazil markets.

The data and insights from this article are sourced from Klines’ Biostimulants and Biofertilizers: Global Overview of the Market and Use and Global Biopesticides: An Overview of Natural and Microbial Pesticides studies.

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