This report is about China's insecticide market in Q1 2017. It attaches importance to the following parts: - Policies related to the pesticide and insecticide industry that happened in Q1 2017, which have significant impact on the pesticide and insecticide industry; - Ex-work prices of about 30 kinds of insecticides in China and price analysis will be made for some most important insecticides during Q1 2017; - An overview of insecticide production in Q1 2017 and the key players, idle players and potential players will be showed in the report; - Newly registrations of insecticides in Q1 2017, from which you can peek into the domestic pesticide development tendency; - Exports about some key insecticides in Q1 2017; - Highlight that had important influences on the pesticide and insecticide industry in Q1 2017.  

In 2016, there were 21 main listed pesticide enterprises in China. Among them, 10 enterprises locate in Jiangsu Province, 4 in Zhejiang Province, 2 in Sichuan Province, 1 in Anhui Province, 1 in Hubei Province, 1 in Hunan Province, 1 in Guangdong Province and 1 in Chongqing City. What's more, there were two newly listed enterprises in 2016, namely Jiangsu Flag Chemical Industry Co., Ltd. and Suli Co., Ltd. The performance of the 21 listed pesticide enterprises can reflect China's pesticide industry. In 2016, the total revenue of the 21 main listed pesticide enterprises in China hit USD7.77 billion, up by 1.80% year on year. Among them, 11 recorded year-on-year drops in their revenue. And the top three enterprises by revenue were Huapont Life Sciences Co., Ltd., Zhejiang Wynca Chemical Industrial Group Co., Ltd. and Jiangsu Huifeng Agrochemical Co., Ltd. in 2016 in China. In 2016, the total net profit of the 21 main listed pesticide enterprises in China reached USD400.95 million, sharply down by 22.97% year on year. Among them, 13 recorded year-on-year drops in their net profit and two of the 13 enterprises suffered losses, including Hubei Sanonda Co., Ltd. and Shenzhen Noposion Agrochemicals Co., Ltd. The top three enterprises by net profit were Huapont Life Sciences Co., Ltd., Jiangsu Yangnong Chemical Co., Ltd. and Lianhe Chemical Technology Co., Ltd. in 2016 in China. In 2016, the total net cash flow from operating activities of the 21 main listed pesticide enterprises in China were USD512.33 million, sharply down by 29.26% year on year. Among them, the top three enterprises by net cash flow from operating activities were Zhejiang Wynca Chemical Industrial Group Co., Ltd., Huapont Life Sciences Co., Ltd. and Lianhe Chemical Technology Co., Ltd. in 2016 in China. In 2016, the total asset of the 21 main listed pesticide enterprises in China amounted to USD14.91 billion, with an increase of 9.49% year on year. Among them, eight recorded year-on-year drops in their total assets. And the top three enterprises by total asset were Huapont Life Sciences Co., Ltd., Nanjing Red Sun Co., Ltd. and Zhejiang Wynca Chemical Industrial Group Co., Ltd. in 2016 in China. In 2016, the total revenue of the 21 main listed pesticide enterprises' pesticide business (including pesticide intermediates) reached USD5.38 billion, with a decrease of 2.91 % year on year. The top three enterprises by revenue from pesticide business were Huapont Life Sciences Co., Ltd., Nanjing Red Sun Co., Ltd. and Jiangsu Huifeng Agrochemical Co., Ltd. And it is worth noting that among the 21 enterprises, ten recorded year-on-year drops in their revenue from pesticide business and eight recorded year-on-year drops in their gross profit margin of pesticide business. In 2016, the total R&D investment of the 21 main listed pesticide enterprises in China hit USD235.30 million, down by 1.41% year on year. Among them, 11 recorded year-on-year drops in their R&D investment. And the top three enterprises by R&D investment were Huapont Life Sciences Co., Ltd., Zhejiang Wynca Chemical Industrial Group Co., Ltd. and Lianhe Chemical Technology Co., Ltd. in 2016 in China. In 2016, Nanjing Red Sun Co., Ltd. (Nanjing Red Sun, stock code: 000525) had a disappointing performance. It gained a revenue of USD532.75 million in 2016, decreasing significantly by 27.19% year on year. In 2016, Jiangsu Changqing Agrochemical Co., Ltd. (Jiangsu Changqing, stock code: 002391) achieved a revenue and a net profit of USD276.02 million and USD24.31 million, decreasing by 5.60% and 35.75% year on year respectively. In 2016, the revenue and net profit of Jiangsu Huifeng Agrochemical Co., Ltd. (Jiangsu Huifeng, stock code: 002496) reached USD879.56 million and USD26.26 million, up by 64.32% and down by 5.40% respectively year on year. In 2016, Jiangsu Lanfeng Bio-chemical Co., Ltd. (Jiangsu Lanfeng, stock code: 002513) achieved a revenue of USD219.38 million with a year-on-year increase of 35.21 % and it turned to a net profit of USD16.1 4 million from a loss in 2015. In 2016, Limin Chemical Co., Ltd. (Limin Chemical, stock code: 002734) had a successful performance and achieved a revenue of USD174.76 million with a year-on-year increase of 30.40% and a net profit of USD17.02 million with a year-on-year growth of 57.13%. In 2016, the revenue and net profit of ABA Chemicals Corporation (ABA Chemicals, stock code: 300261) reached USD99.63 million and USD2.44 million, down by 1.07% and 75.18% year on year respectively. In 2016, the revenue and net profit of Jiangsu Flag Chemical Industry Co., Ltd. (Jiangsu Flag, stock code: 300575) reached USD135.31 million and USD11.62 million, up by 4.39% and down by 23.68% respectively, compared with those in 2015. In 2016, Lier Chemical Co., Ltd. (Lier Chemical, stock code: 002258) achieved a revenue and a net profit of USD298.54 million and USD31.38 million, up by 24.84% and 41.12% year on year respectively. In 2016, Sichuan Guoguang Agrochemical Co., Ltd. (Sichuan Guoguang, stock code: 002749) gained a revenue and a net profit of USD92.51 million and USD20.97 million, with year-on-year decreases of 4.78% and 2.41% respectively. In 2016, Huapont Life Sciences Co., Ltd. (Huapont Life Sciences, stock code: 002004) gained a revenue of USD1,068.17 million, up by 7.74% year on year and a net profit of USD85.37 million, down by 16.50% year on year. In 2016, Lianhe Chemical Technology Co., Ltd. (Lianhe Chemical, stock code: 002250) had a bad performance with the revenue of USD466.76 million and the net profit of USD39.74 million, falling sharply by 27.48% and 61.22% year on year respectively. In 2016, Hubei Sanonda Co., Ltd. (Sanonda, stock code: 000553) suffered significant year-on-year falls in its revenue and net profit due to the depressed pesticide market. Specifically, its revenue reached USD297.32 million with a year-on-year decrease of 19.84% and its net profit was -USD11.22 million with a sharp year-on-year decline of 149.25%. In 2016, Shenzhen Noposion Agrochemicals Co., Ltd. (Shenzhen Noposion, stock code: 002215) has a bad performance with a revenue of USD295.62 million, decreased by 16.69% year on year and suffered a significant loss of USD41.60 million with a sharp year-on-year decrease of 212.22%. In 2016, Hefei Fengle Seed Co., Ltd. (Hefei Fengle, stock code: 000713) recorded a revenue of USD1 83.38 million, up by 2.63% year on year and a net profit of USD3.22 million, down by 34.11% year on year. In 2016, Nantong Jiangshan Agrochemical & Chemical Co., Ltd. (Nantong Jiangshan, stock code: 600389) had a satisfactory performance. Its revenue increased to USD715.58 million, up by 66.44% year on year and its net profit reached USD7.89 million, up by 364.71% year on year. In 2016, Jiangsu Yangnong Chemical Co., Ltd. (Jiangsu Yangnong, stock code: 600486) achieved a revenue of about USD441.10 million in 2016 with a year-on-year decrease of 11.80% and a net profit of USD66.15 million with a year-on-year decrease of 9.48%. In 2016, the revenue of Suli Co., Ltd. (Suli, stock code: 603585) increased to USD203.40 million, up by 12.80% year on year and its net profit increased to USD27.90 million, down by 47.12% year on year. In 2016, Zhejiang Qianjiang Biochemical Co., Ltd. (Qianjiang Biochemical, stock code: 600796) achieved a revenue of USD66.88 million with a year-on-year decrease of 12.1 5% and a net profit of USD4.94 million with a year-on-year growth of 16.00%. In 2016, Zhejiang Shenghua Biok Biology Co., Ltd. (Shenghua Biok, stock code: 600226) suffered a year-on-year decrease of 6.65% in its revenue, reaching USD151.43 million; while its net profit still enjoyed a significant year-on-year growth of 57.96%, reaching USD35.48 million. In 2016, the revenue of Zhejiang Wynca Chemical Industrial Group Co., Ltd. (Zhejiang Wynca, stock code: 600596) dropped to USD1,024.46 million with a decrease of 13.17% year on year and it gained a net profit of USD11 .68 million. In 2016, Hunan Haili Chemical Industry Co., Ltd. (Hunan Haili, stock code: 600731) gained a revenue of USD170.30 million with a year-on-year increase of 0.32% and its net profit decreased by 3.54% year on year to USD2.13 million.

In Q1 2017, Zhejiang Wynca realized glyphosate sales of USD81.11 million (RMB559.30 million). In Q1 2017, Nantong Jiangshan realized glyphosate sales of USD59.78 million (RMB412.21 million), 46% of the total. Sichuan Hebang's sales of glyphosate and PMIDA reached USD12.70 million (RMB87.61 million) and USD48.25 million (RMB332.73 million) in Q1 2017, 9.44% and 35.85% of the company's total sales. In 2016, Sichuan Hebang's sales of glyphosate and PMIDA took up 8.03% and 36.99% of the total sales respectively. On 27 April, Sichuan Fuhua organized a "2017 business open day" and invited the public, nearly 30+ people, to visit its technology innovation and envrionmental protection achievements. The 2017 Top 100 Chinese Pesticide Companies by 2016 Sales has been released. Compared to the previous year's ranking, some changes were recorded due to the depressed pesticide market, stricter environmental requirements, the policy against development of paraquat, and company M&As. The total sales of top 100 pesticide enterprises increased by nearly 6% YoY, despite last year was a "cold winter" for pesticide industry. In 2016, pesticide industry maintained a downturn with the total net profit declining. The total sales of top 50 enterprises of pesticide formulations fell by 5.3% YoY. The best selling herbicides in China in 2016 included 11 products from 11 companies. Thereinto, Dow AgroSciences (China) LLC's Daojie, and YongNong BioSciences Co., Ltd.'s Baisudun were in the list. The best selling insecticides in China in 2016 included 13 products from 13 companies. DuPont China Holding Co.,Ltd.'s Kangkuan, Beijing Yoloo Pesticide Co., Ltd.'s Yanhua Saofei, Hebei Veyong Bio-Chemical Co., Ltd.'s Lanrui and Syngenta (China) Investment Co., Ltd.'s Fuge were all listed. The best selling fungicides in China in 2016 included 17 products from 17 companies.Specifically, BASF (China) Corporation's Baitai, Bayer CropScience (China) Co., Ltd.'s Nadiwen, Beijing Yoloo Pesticide Co., Ltd.'s Yanhua Chuanqi, and Jiangsu Pesticide Research Institute Co., Ltd.'s Jinghu were in the list. The best selling plant growth regulators in China in 2016 included 10 products from 11 companies. Shanghai Lvze Biotechnology Co., Ltd.'s Yuntianli, Sichuan Guoguang Agrochemical Co., Ltd.'s Lixiao, and Nanjing CF Agrochemical Co., Ltd.'s Wendefu were in the list. The best selling pesticides in China in 2016 included 9 products from 9 companies. Jiangsu Luye Agrochemicals Co., Ltd.'s Shenghua, Jiangmen Plant Protection Co., Ltd.'s Jiashoumi, and Langfang Pesticide Medium-sized Refinery Factory, IPP, CAAS's Atailing were in the list. The 2016 most explosive products (brands) in Chinese crop protection market included 9 products from 9 companies. Shenzhen Noposion Agrochemicals Co., Ltd.'s Jiaku, Anhui Zhongbang Biological Engineering Co., Ltd.'s Huangjin Wanliang, and Beijing Mindleader Agroscience Co.,Ltd.'s Mingxunfeng were listed. The 2016 outstanding pesticide intermediate suppliers in Chinese pesticide industry included 14 companies. Shandong Huimeng Biotechnology Co., Ltd., the best supplier and mainstream pyridine supplier of Bayer CropScience, Hebei Chengxin Co., Ltd., mainstream supplier of organic sulfide and pyridine derivatives, Wujiang Dongwu Agrochemical Co., Ltd, one of the world's largest nicotinic pesticide intermediate suppliers, Chongqing Unis Chemical Co., Ltd. mainstream producer of n-phenylglycinenitrile and iminodiacetonitrile and Syngenta's TMOF/DHP supplier, Hebei Donghua Jiheng Fine Chemical Co., Ltd., China's largest glycine producer and Vertellus Specialty Chemicals (Nantong) Co., Ltd., mainstream supplier of pyridine were all in the list. On 4 May, the ISAAA released its annual report showcasing the 110-fold increase in adoption rate of biotech crops globally in just 21 years of commercialization – growing from 1.70 million ha in 1996 to 185.10 million ha in 2016. ISAAA's report, Global Status of Commercialized Biotech/GM Crops: 2016, continues to demonstrate the long-standing benefits of biotech crops for farmers in developing and industrialized countries, as well as consumer benefits of recently approved and commercialized varieties. The research team of the Institute of Biotechnology, CAAS, led by researcher Guo Sandui and Zhang Rui, has succeeded in cultivating a new type of high glyphosate-resistant cotton with low residue, with nearly 10 years' great effort, which made the enhancement of the mechanization of weed control and cost-reducing cotton production possible. After waiting for years, glyphosate·glufosinate-ammonium mixture was registered in China for the first time. In May, Shenzhen Noposion temporarily registered the glyphosate·glufosinate-ammonium 36% AS. In March 2017, China's export volume of glyphosate TC increased by 6.26% MoM but down 21.26% YoY respectively. In the first half of May 2017, the ex-works prices of glyphosate 95% TC was USD3,300.50/t (RMB21,200/t), up 17.78% YoY and down 13.03% MoM. The price of glyphosate formulations also showed a downtrend.

The CCPIA disclosed that related government departments are actively studying a change in the export tax rebate on pesticide formulations. Industry insiders predict that this will give China's pesticide business a boost. Given the importance of pesticide exports, and Weifang Rainbow's rising advantage in export markets, more and more domestic pesticide companies may learn from Weifang Rainbow's operational mode that's boosting its exports. China's glufosinate-ammonium market is now in rapid development, with increasing manufacturers expanding their production capacities to capture larger sales. In this context, market competition is expected to further intensify in the coming period. The best selling herbicides in China in 201 6 included 11 products from 11 companies. Thereinto, Dow AgroSciences (China) LLC's Daojie, and YongNong BioSciences Co., Ltd.'s Baisudun were in the list. The best selling pesticides in China in 201 6 included 9 products from 9 companies. Jiangsu Luye Agrochemicals Co., Ltd.'s Shenghua, Jiangmen Plant Protection Co., Ltd.'s Jiashoumi, and Langfang Pesticide Medium-sized Refinery Factory, IPP, CAAS's Atailing were in the list. Reportedly, the main part of Sino-Agri Union's 2,000 t/a dicamba TC project has been finished, and the company will accelerate the construction next to put it into operation as soon as possible. In this way, it can enrich its technical product varieties and boost financial performance. Jiangsu Huifeng may put its 5,000 t/a glufosinate-ammonium TC project into operation on 1 Sept., 2017, which may further consolidate its position in the market, and boost its performance. The total sales of top 100 pesticide enterprises increased by nearly 6% YoY, despite last year was a "cold winter" for pesticide industry. In 2016, Shandong Luba witnessed YoY drops in both revenue and net profit, mainly because of the falling price of paraquat and pyridine. The 2017 Rotterdam Convention failed to agree on the inclusion of paraquat into its Annex III once again, meaning concerns over export restrictions on it were settled. Given this, paraquat is still expected to enjoy promising prospects in overseas markets. In 2016, China's export volume of atrazine witnessed a YoY rise, but export price suffered a YoY decline. In April 2017, China had 26 new herbicide TC registrations, which included 19 active ingredients. The new Regulations on Pesticide Administration in China is to come into effect on 1 June, 2017. In particular, the amendments to pesticide registration have drawn much attention from the industry. In May 2017, the MOC decided to approve the merger of Dow and DuPont, but asked them to divest some businesses as a precondition of the approval.

2017 China Top 100 Pesticide Enterprises was released on 10 May. According to the list, top 10 enterprises see 10.86% increase in total sales. The market prices of imidacloprid TC, acetamiprid TC and chlorpyrifos TC continued climbing in early May under environmental pressure. However, lambda-cyhalothrin TC saw its market price going down. According to the NBS, the total supply of insecticides increased by 12.6% YoY to 149,397 tonnes (converted into 100% AI) in Q1 , which accounted for 16.8% of total output of pesticides. The result was led by abundant supplies in Jiangsu, Hubei, Shandong and Hunan provinces—these main producing areas all saw YoY surges in output. Insecticide producers saw increasing net profits with the price significantly going up. However, the profiting space may shrink considering the financial costs, environmental costs and intensifying competitions. Sino-Agri Union will establish a wholly-owned subsidiary to further develop international business and to expand cooperation channel. This is a move to optimise strategic layout and enhance competitiveness so as to accelerate the internationalisation process. In early May 2017, Beijing Mindleader announced that it had launched its new product "Delang" (15% abamectin·spirotetramat SC). Beijing Mindleader, established in 2011 , is a dark horse in the industry with its sales reaching USD23.93 million (RMB165.00 million) after five years' development. In reality, such an outstanding performance is partly because of its flagship products. In 201 6, one of its fungicides named "Mingrunfeng" (30% tebuconazole·pyraclostrobin SC) had achieved sales of USD4.35 million (RMB30.00 million) after its launch in China. The new product in 2017 will also arouse wide attention nationwide and may even record larger sales. The exports of chlorpyrifos TC saw downward trend in early 2017. In May, the demand for chlorpyrifos TC in China will decline and more will be exported in the coming months. However, the total export volume is estimated to continue falling. The major export destinations are still Portugal, Thailand, Vietnam and other Eurasia countries. In May 2017, good news for the China's chlorpyrifos exports finally came after years of depression: the APVMA concluded that there is no evidence to indicate that chlorpyrifos could cause potential neurodevelopment effects; EPA Administrator Scott Pruitt denied the petition requesting to ban chlorpyrifos in the US. Yet, the Chinese chlorpyrifos market is now in short supply due to strict environmental regulations. It still remains to be seen how the chlorpyrifos export market will go in the coming period. According to the CCPIA, there are ten new quality insecticides to go off patent, in which lvanlin, lupyrazofos and spirotetramat will be off-patented in two months. Therefore, other insecticides technical manufacturers will be allowed to have registration. Judging from the registration of insecticides formulations, chlorantraniliprole, spirotetramat and sulfoxaflor are more popular. There were 88 insecticide products registered in China in April, and they came from 66 enterprises. The most popular were imidacloprid, thiamethoxam and dinotefuran while the most common form was SC. Rice pests are extremely occurred in Zhejiang Province. In May 2017, the Department of Agriculture of Zhejiang Province released the 2017 Recommended Pesticides of Zhejiang Province for Preventing and Treating Main Pests and Diseases, aiming to strengthen pests and diseases prevention and treatment. In April 2017, the Hunan Agricultural Committee released a series of subsidy policies to facilicate the implementation of the Regulations on Pesticide Administration and meanwhile strengthen regulations on the local pesticide market. On 12 May, 2017, the MOA released its opinions on ban or restriction on agricultural use of 5 insecticides, including endosulfan, methyl bromide, acephate, carbosulfan, and dimethoate.

Two famoxadone mixtures get on the‘last bus' for temporary registration In April 2017, two famoxadone mixtures were successfully approved for temporary registrations, according to the Institute for the Control of Agrochemicals, Ministry of Agriculture. They are dimethomorph•famoxadone 40% SC from Jiangxi Zhonghe Chemical Co., Ltd. (Jiangxi Zhonghe) and famoxadone•pyraclostrobin 30% WG from Shaanxi Weierqi Crop Protection Co., Ltd. (Shaanxi Weierqi). Notably, according to the new Regulations on Pesticide Administration, which will come into force on 1 June, 2017, temporary registration of pesticide will be canceled. The two famoxadone mixtures luckily got on the "last bus" for temporary registration. On 10 April, Jiangxi Zhonghe was approved for the temporary registration of dimethomorph•famoxadone 40% SC (20% dimethomorph+20% famoxadone, registration No. LS20170204 ) which will be applied on potato for the prevention and treatment of late blight. This is actually the first mixture between dimethomorph and famoxadone in China. Also on 10 April, Shaanxi Weierqi was approved for the temporary registration of famoxadone•pyraclostrobin 30% WG (15% famoxadone+15% pyraclostrobin, registration No. LS20170208) which will be applied on grape for the prevention and treatment of downy mildew. This is also the first mixture between famoxadone and pyraclostrobin in China. In addition, as of late April, all 15 famoxadone formulations are mixtures. Prior to this, the active ingredients contained in the mixtures included cymoxanil, mancozeb, azoxystrobin and fluquinconazole, and registered products were mainly applied for the prevention and treatment of cucumber downy mildew, tomato early blight, tomato late blight, potato early blight, potato late blight, pepper blight, watermelon anthracnose, Chinese cabbage black spot, grape downy mildew, tangerine citrus scab, apple alternaria leaf spot, apple ring rot, banana brown spot and jujube rust. As an efficient fungicide that can be applied on multi-crops, famoxadone is now one of popular fungicides researched domestically and internationally. It is a safe fungicide without cross resistance and featured with high activity, wide spectrum and unique mechanism of action. Famoxadone is also highly efficient and helps resolve resistance problems of systemic fungicides by mixing with them. DuPont is the first enterprise that has registered famoxadone products in China, while domestic enterprises have not registered until the year of 2013 (repacking registration excluded). In recent years, famoxadone has been rapidly developed in China. At present, famoxadone is one of products promoted and popularised by the National Agro-technical Extension and Service Center and also procured by Chinese governments for the prevention and treatment of rice blast. It is estimated that more and more enterprises will begin to develop it or develop its mixture with other efficient fungicides. However, famoxadone TC producers in China are not enough and the total capacity is very limited, therefore, there is a big opportunity in the market of pesticide technical. In this context, quite a lot of enterprises are paying much attention on the famoxadone TC development so as to capture larger markets. In 201 6, Anhui Guangxin Agrochemical Co., Ltd. (Guangxin Agrochemical) invested USD55.24 million (RMB380.90 million) in 1,200 t/a famoxadone project. and disclosed that it would not only run for the technical market but also develop more effective formulations in the future, despite no famoxadone formulations has been registered by it.