Market Opportunities of Botanical Pesticides Being Expanded



Botanical pesticides have golden chances for development

With the shift of the world's pesticide production bases to countries like China and India, the pesticide industry in China has been offered a rare chance for development and the export value of pesticides has increased constantly. While making huge contributions to the export in China, some problems have arisen in the export of chemical pesticides.

    1. Vicious price competition has caused a reduction in export profit

Vicious price competition and overseas antidumping to some products have always been two major problems besetting pesticide export enterprises in China. The constant expansion of the pesticide capacity and the reduction of the export price have, in particular, seriously affected profits in export enterprises. The fundamental cause is that products made in China have no initiative in the market because they have made no registration in foreign countries and therefore have to rely on commission sales by foreign companies or dealers.

    2. Green barriers have become more prominent

Since the WTO accession, there have been more frequent international trade contacts. Factors related to environmental protection have become a means for many countries to restrict the coming of products made in other countries into their own markets. More stringent requirements on pesticides in the international market will surely increase the R&D expenses and the production cost in export products and affect the export of some products in China.

   3. Conversion rate readjustment has reduced profits in export enterprises

The conversion rate of RMB to US$ was increased by 2% in 2005. It means that profits of products priced in US$ in export enterprises are reduced by 2%. Besides, the pressure of further RMB appreciation will exist for a considerable period of time in future.

    4. Requirements on environmental protection have become more stringent in China

In light of the increasing pressure caused by the pesticide production on environment, the Chinese Government has tightened its control on the discharge of pollutants in the pesticide production. The State Environmental Protection Administration has formulated the “Limits for the Discharge of Pollutants in the Pesticide Sector”, laying down clear-cut provisions for the discharge of 10 categories of pollutants in pesticide producers.    Pesticide producers intending to make further developments should therefore produce a greater variety of products. There is a rare chance for the development of biological pesticides today. The development and utilization of botanical pesticides as an important part of biological pesticides has, in particular, aroused great interest in various countries.    Compared with chemical pesticides, botanical pesticides have the following advantages: (a) Botanical pesticides have low toxicity to man, livestock and useful crops and can have easy degradation with little or no residue. There is therefore no problem in environmental protection. (b) Great quantities of waste hills, slopes and untilled land can be used. Few expenses are needed and farmers' income is high. (c) Most botanical pesticides have complicated ingredients and can produce effect on several physiological systems of hazardous organisms. The resistance to pesticides developed in hazardous organisms can therefore be avoided. (d) The registration cost is only around one fortieth of the registration cost for chemical pesticides. The burden on pesticide producers is therefore not great. (e) Botanical pesticides produced in China have some peculiarity and there are no comparable prices. The profit margin is therefore greater than chemical pesticides. (f) Besides the direct use, active ingredients in botanical pesticides can also be used as precursor compounds in the synthesis of new pesticides and therefore build a foundation for the development of innovative pesticides in China.    At a time when chemical pesticides in China are faced with a lot of problems, the development and production of botanical pesticides have greater practical implications.

Research achievements promote the development of botanical pesticides

As early as the 1930s China started extensive research of plants with insect-killing effect such as tobacco, derris, pyrethrum, thickfruit millettia and tripterygium wilfordii.    With the progress in chromatography, nuclear magnetic resonance and mass spectrography, the research of plant natural chemistry has developed remarkably and a sound foundation has been laid for the determination and development of effective ingredients in botanical pesticides. Active substances with novel structure ad unique function have kept being discovered in plants in recent years. The development and application of botanical pesticides has therefore gained a still brighter prospect.

Various factors beset the development of botanical pesticides

China has 43 000 varieties of plants in total and valuable resources can be provided for the development of botanical pesticides. Nearly 1 000 varieties of plants have been proved to have active substances with insect and germ killing effect. More than 100 botanical pesticides are already being sold in the China's market.     Let's take Yunnan province with the best conditions for the development of botanical pesticides as an example to analyze some problems in the development of botanical pesticides in China. Owing to favorable geographical and climatic conditions, Yunnan province has more than 30 000 varieties of plants and of the total around 15 000 varieties are higher plants. The variety of plants in the province accounts for more than a half of the national total. The production of botanical insecticides based on nim and pyrethrum has become a focus in recent years. The nim planting area in Yunnan province already reached 14 000 ha by the end of 2003 and the province has become the largest nim planting base in China. In spite of the remarkable advantage in the development of botanical pesticides in Yunnan province, the present operation status in enterprises causes great concern and it is hard to make a further development.     There is a financing problem in the botanical pesticide sector of the province and many enterprises are faced with challenges for their existence. Besides, the high development cost has led to the high price and difficult sales of botanical pesticides. According to the experts, if the per-ha cost for chemical pesticides is RMB150, the per-ha cost for botanical pesticides is RMB225-300. Some chemical pesticides with low price but high residue and acute toxicity are therefore still the choice products for farmers.    In addition, efforts made by the government to crack down agricultural products with unduly high pesticide residue are inadequate and the sale and use of pesticides with high residue and acute toxicity is not resolutely prohibited.    Another factor is that farmers lack understanding of botanical pesticides. Many botanical pesticides have small toxicity and slow release. For example, nim-based pesticides produce insect preventing and killing effect mainly through adjusting incretion systems and affecting nervous systems of insects. Farmers, however, do not understand that. To get the best effect, nim-based pesticides should be applied in the preventive stage or the early stage of insect hazards. If they were applied after the outbreak of insect hazards, their effect would be not as good as chemical pesticides. Besides, operating instructions should be strictly followed in