Agricultural Chemical Manufacturers
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 749 Agricultural chemical manufacturers in the US produce fertilizers, pesticides, and repellents, herbicides and fungicides, soil amendments, plant growth regulators, and seed treatments. Customers include chemical distributors, farms and ranches, seed producers, nurseries and greenhouses, farm support services, pest control firms, veterinary practices, landscaping firms, golf courses, home improvement and garden stores, and consumer retail.
Seasonal Demand Dependent on Weather
Demand for agricultural chemicals is tied to weather conditions and the seasonality of farming.
Chemical Regulation and Liability
Agricultural chemical manufacturing is highly regulated to protect workers, the environment, and product users.
Industry size & Structure
The typical agricultural chemical manufacturer operates from a single location, employs 51 workers, and generates $56.5 million annually.
- The agricultural chemical manufacturing industry comprises about 749 companies that employ 38,200 workers and generate $42.3 billion annually.
- The industry is concentrated, with the 8 largest fertilizer companies representing 60% of segment revenue and the 8 largest pesticide companies generating 71%.
- Large companies include Syngenta AG, FMC, Adama, Drexel, Nufarm, Valent, and Corteva Agriscience (former agricultural chemicals division of DowDuPont), as well as agriculture divisions of diversified chemical manufacturing companies such as Monsanto (Bayer) and BASF. Large firms may have domestic and foreign operations.
Industry Forecast
Agricultural Chemical Manufacturers Industry Growth
Recent Developments
Jan 18, 2025 - Generic Competition
- Facing tighter budgets, US farmers are trading down to generic chemicals to treat their crops, in a blow to the big agricultural chemical manufacturers, Reuters reports. Falling crop prices and rising input costs are causing US farmers to cut back on their spring planting budgets, sending shocks throughout the US agriculture sector, including companies that make pesticides and fungicides. “It’s like if you grew up eating Fruity Pebbles and now you go to Dollar General and get Fruity Bites,” Illinois grain grower Jeff O’Connor told Reuters. The pullback in spending is impacting ag chemicals companies including Bayer, Syngenta, Corteva, which are also facing increasing generic competition. The expiration of over two dozen active ingredient patents in recent years is driving a boom in off-patent use, with which now accounts for about 80% of the agrichemical market share, Rabobank agricultural analysts told Reuters.
- Producer prices for agricultural chemical manufacturers rose 1.4% in November compared to a year ago after sinking 23.3% in the previous November-versus-November annual comparison, according to the latest US Bureau of Labor Statistics data. Following a steep runup that began in the fourth quarter of 2020 and peaked in April 2022 after which prices dropped precipitously, prices have exhibited a flatter trend. Meanwhile, industry employment grew 4.4% year over year in October and average industry wages at chemical manufacturers rose 1.9% YoY in November to $31.19 per hour, BLS data show. Sales for all other chemicals companies declined 2.2% year over year in Q3 and were down 12% versus Q2. Sales typically peak in the second quarter, coinciding with the spring planting season.
- In October, the EPA announced the cancellation of all products containing the pesticide dimethyl tetrachloroterephthalate (DCPA or Dacthal) under the Federal Insecticide, Fungicide and Rodenticide Act. In August, the agency had issued an emergency order suspending all registrations of the pesticide due to serious health risks – the first time in almost 40 years EPA took this type of emergency action. The pesticide is registered to control weeds in both agricultural and nonagricultural settings, but DCPA is primarily used on crops such as broccoli, Brussels sprouts, cabbage, and onions. The final cancellation prohibits anyone from distributing, selling or carrying out other similar activities for the remaining pesticide products containing DCPA as well as prohibiting using existing stocks of those products. In August, American Vanguard Corp., the only manufacturer of Dacthal, said it was working to remove it from distribution.
- Updated projections for 2024 farm income don’t look quite as gloomy as they did earlier this year, AgWeb’s Farm Journal reports, citing new data from the Economic Research Service (ERS). New numbers from the ERS show net cash farm income for 2024 will fall $12 billion, which is about 7% down from 2023, and net farm income will fall $6.5 billion or 4.4%. That’s compared to ERS projections released in February that suggested net farm income would fall 26%. The primary cause for 2024’s decline in farm income is commodity prices. Cash receipts or sales are expected to fall by $27.7 billion. When combined with the inventory adjustment for crops, the value of crop production is forecast to fall $25.6 billion from 2023 with the largest decline coming from corn and soybeans. Fertilizer expenses for crop farmers are expected to fall by almost 10%.
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