What Chinese Agrochemical Firms Can Learn From Corteva’s Potential Breakup
20 September 2025 Editor’s note: This article is adapted from the September 2025 China Price Index, a regular column by David Li, Marketing Director at SPM Biosciences, exclusively for AgriBusiness Global.
The reported plans by Corteva to split its seed and crop protection businesses into separate entities have sparked intense interest across the global agrochemical sector. For Chinese pesticide companies, the potential separation represents far more than just a restructuring of a U.S.-based multinational — it may be a case study in corporate strategy, capital discipline, and long-term vision.
According to The Wall Street Journal, Corteva is considering the move to unlock shareholder value, manage litigation risk, and attract more targeted investment across its diversified business lines. With a market value nearing $50 billion, the company’s decision could become one of the most influential restructurings in the global ag inputs industry.
“Corteva’s strategic split reflects a deeper shift in how agrochemical companies manage growth, risk, and innovation,” says David Li, Marketing Director at SPM Biosciences, and author of the China Price Index column for AgriBusiness Global. “It’s about aligning capital with the right type of business model — and that’s something Chinese companies must pay close attention to.”
Capital Allocation and Investor Appetite
At its core, Corteva’s move is about capital flexibility. The crop protection and seed segments, while both central to modern agriculture, attract fundamentally different types of investors.
“Risk-tolerant capital is drawn to the long R&D cycles and breakthrough potential in biotech seed innovation,” Li explains. “Meanwhile, crop protection — especially generics — appeals more to investors seeking predictable cash flows and stable margins.”
In China, where most pesticide companies are vertically undifferentiated and margin-constrained, this approach offers a blueprint for how to think about internal resource allocation more rationally.
“Chinese firms are often trapped in one-size-fits-all models,” says Li. “What Corteva is doing is recognizing that different parts of the business require different strategies — and capital structures — to succeed.”
Beyond Products: The Governance Advantage
Perhaps more importantly, Corteva’s potential split is a signal about governance and strategic clarity.
Li notes that Chinese pesticide companies often focus too heavily on short-term product investments, such as chasing near-off-patent actives or expanding technical production capacity. What they lack, he says, is a cohesive long-term vision.
“Strategy is not about choosing the next molecule to register,” Li emphasizes. “It’s about defining your competitive arena, clarifying how you will win, and building the systems to deliver on that vision.”
This kind of thinking, Li argues, is what separates high-performing multinationals from commodity-driven operations. Chinese firms that fail to articulate a ‘winning vision’ — and back it up with organizational capability — will struggle as global competition intensifies.
Lessons for Chinese Agrochemical Companies
While the business environments in the U.S. and China differ significantly, Li believes Chinese agrochemical firms can take three key lessons from Corteva’s strategic thinking:
- Separate High-Risk from Cash-Generating Units. “There’s wisdom in separating exploratory investments from cash-generating businesses,” Li says. “It allows each to be managed according to its own risk-reward profile.”
- Align Governance with Strategy. As global supply chains rebalance and off-patent products face narrowing margins, organizational agility becomes critical. “Corteva’s restructuring could lead to more responsive governance—and that’s what Chinese firms need more than ever,” Li notes.
- Invest in Vision, Not Just Volume. The tendency to equate growth with output is outdated. “Chinese firms should invest in product assets that are part of a larger strategic framework—not just molecules with a near-term margin opportunity,” he adds.
A Turning Point by 2025?
With 2025 shaping up to be a pivotal year — many MNCs, including Bayer and Corteva, are pursuing corporate realignments or divestitures — Chinese companies are at a crossroads.
“Chinese enterprises must find a way forward,” Li warns. “But that path won’t come from imitation — it will come from internal transformation.”
In that spirit, he encourages Chinese agrochemical leaders to ask themselves hard questions:
- What is our winning vision?
- In which areas will we compete?
- How will we win?
- What capabilities must we build?
- What systems must support those capabilities?
As the global agrochemical market evolves, Chinese firms have an opportunity to reimagine themselves — not just as manufacturers, but as strategic players in a reshaped industry.
“Corteva is showing the world how bold governance moves can unlock hidden value,” Li concludes. “If Chinese companies want to thrive, they must move beyond incremental improvements and embrace the bigger questions of strategy.”
- Read the full article: China Price Index: A Different Path for Chinese Companies Amid Brazil’s Crop Protection Crisis
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