Crop Protection Market Development in Asia

By Derek Oliphant

India | Vietnam | Thailand | Indonesia | Philippines

This article will outline the development of the crop protection market in India, Vietnam, Thailand, Indonesia, and the Philippines, examining the current situation as well as the key future trends expected to influence market development over the next five years.

Market values are Agbiolnvestor’s estimates of the value of crop protection products used on the ground in the agricultural year, expressed in US$ terms at the ex-manufacturer level.

INDIA

In 2023, the crop protection market in India declined by 8.5% in U.S. dollar terms to $3,219 million. As with many countries in the region, India’s crop protection market in 2023 was held back by declining agrochemical prices, inventory build-up, continued currency weakness, and variable weather conditions.

In 2024, it was again a difficult year for the crop protection market in the country, with the value of the sector falling by 5.4% to $3,044 million. The main impacts were again weather-related, particularly an erratic monsoon, and relatively low pest pressure. Inventory levels remained elevated through much of the year, which hampered supplier sales into the channel.

For 2025, weather conditions have generally been much improved, and recovery can be expected. The market continues to benefit from increasing technification, including higher product usage intensity; increased adoption of seed treatment technology; trading up to more advanced product technologies; and requirement to boost crop yields in order to feed the rising population.

The monsoon is forecast to be above-average in terms of rainfall through September, which is regarded as a positive for crop production in the country. The monsoon season typically delivers approximately 70% of India’s annual rainfall, and as such is the key source of irrigation for crop cultivation in the country.

Improved intellectual property legislation which incentivizes the introduction of proprietary technologies should also bring value to the market, with any product patented post-1995 gaining additional protection in the form of companies having to gain manufacturing approval from the registration holder. This has led to a positive environment for the introduction of new products and has helped to alleviate some issues of resistance to older chemistries.

A number of new product introductions have taken place in the country in recent years, including BASF’s insecticide fenmezoditiaz and fungicide mefentrifluconazole; Hokko Chemical’s herbicide ipfencarbazone, through Dhanuka Agritech; Nissan Chemical’s metazosulfuron, through Insecticides India; and ISK’s tolpyralate, through Godrej Agrovet. These latter introductions reflect the increasingly close collaboration between Japanese and Indian companies providing India with access to proprietary technologies while allowing the Japanese companies to expand commercial outreach of their in-house developed active ingredients to markets outside Japan.

While low-cost commodity products have long been a mainstay of Indian crop protection, product choice will become more limited in the coming years. In 2020, the government issued a draft order, Banning of Insecticides Order 2020, which prohibits the import, manufacture, sale, transport, distribution and use of 27 pesticides, with further products subsequently being added to this list. An addendum was later applied allowing the manufacture of these 27 pesticides for export purposes. These moves could accelerate adoption of newer, higher priced technologies in the crop protection sector, to the benefit of the overall value.

As a result of the above factors, the value of the Indian crop protection market is anticipated to expand at an average annual rate of 5.1% p.a. between 2024 and 2029 to reach $3,900 million. This level of growth places the country comfortably ahead of the industry average, cementing India’s position as a strong developing market, with considerable scope with the market still some way from maximizing its potential, based on the coverage of crop type and crop areas which can be cultivated in the country.

THAILAND

Thailand’s economy has made strong progress in social and economic development, moving from a low-income country to an upper-income country in a relatively short period of time. The divide between rich and poor has been continually declining, and this trend is expected to continue. The agricultural sector contributes approximately 10% to the county’s GDP, with rice exports alone representing more than 1% of Thailand’s GDP. Agriculture has been a primary factor in Thailand’s development. Thailand’s long-standing farming tradition and favorable climate have bolstered the country’s position as a key exporter of several agricultural products, including widely consumed commodities such as rice, sugar and rubber.

Strengths

• 35% of the population is involved in agriculture

• Recently began 20-year economic plan to improve economic stability

• Large suitable land area for rice cultivation

• Second largest sugarcane exporter after Brazil

• Low cost of sugarcane production

• Competitive sugar exports through the ASEAN Economic Community Free Trade Agreement

Weaknesses

• Agriculture less than 10% of GDP

• Lack of mechanization in agriculture

• Poverty still an issue

• Frequently requires government intervention when rice prices are low

 Opportunities

• Development of the agricultural sector through a new economic model (BCG)

• Increased consumption of biofuels (typically sourced from sugarcane and cassava)

• Growing population with higher disposable income

• Increasing demand from the feed sector

• Opportunity to export processed goods rather than raw crops

• Higher levels of rice exports

• Higher demand for organic Thai produce

• Local proximity to Indonesia and China where sugar demand is increasing

• Potential for yield improvements

Threats

• Rapidly aging population, in excess of its regional comparators

• Higher rates of rice consumption per capita in rural households compared to urban

• With increased GDP, the population is slowly moving away from rice consumption

• Water availability for irrigated rice

  

PHILIPPINES

In 1946, the Philippines regained its independence after World War II. However, since then, the country has endured periods of political and economic upheaval, fueled by the many factions in the country. Despite this, in the 2000s, the Philippine economy performed well until a downturn in 2017. The economy, the third largest in the ASEAN region, has benefited from improved tax administration and expenditure management, reducing the Philippines’ debt burden and tight fiscal situation. Poverty afflicts around 20% of the population but is much higher in some areas of the southern Philippines.

Tax reform legislation aimed at addressing poverty and providing improved infrastructure and capital investment, which is seen as a major block on further economic improvement, has been a key political focus in recent years.

In 1967, the Philippines was a founding member of the ASEAN free trade pact along with Indonesia, Malaysia, the Philippines, Singapore and Thailand.

Agriculture accounts for less than 10% of the Philippines’s GDP, but employs over a quarter of the country’s labor force, while arable products account for only 3% of total exports. The country is prone to natural disasters such as typhoons, earthquakes, and floods. Rice is key to the Philippine diet and agricultural policy has focused on rice self-sufficiency and support for production. However, increasing industrialization and construction have led to a reduction in available arable land.

The country has significant natural resources including copper, timber, nickel, petroleum, silver, gold, cobalt, and salt. Agriculture is practiced mostly on coastal plains and in central valleys. The main imports are grains, fruits, and oilseeds. The major grain crops produced are rice and maize, although export is extremely limited. The most significant sources of vegetable oils are coconut (3.8 million hectares) and oil palm oil (130,000 tonnes).

After grains, agricultural production is dominated by plantation crops, notably coconut, banana, sugarcane, rubber, mango and pineapple. A variety of tropical fruit crops are cultivated in the country, with bananas/plantains, mango, pineapple, cashew nuts and citrus are the largest individual crops by area. The largest vegetable/pulse crops cultivated are cassava, sweet potatoes, dry beans and pulses, aubergines, pumpkins and onions. The country has a negative balance in trade in arable products, relying on imports of grain, fruits, and oilseeds. Agrochemical usage on a per hectare basis is similar with that in other developing markets, but higher than in other developing Asian countries Cambodia and Myanmar.

The Philippines experience a tropical climate that is for the most part hot and humid year-round, a dry season runs between November and May and a wet season between June and October. The eastern Visayas see the highest rainfall and typhoons throughout the year due to their proximity to the Pacific Ocean, while the northern island of Luzon typically enjoys a warmer and drier climate.

The tropical climate is conducive to the production of plantation crops, with coconut, banana, tobacco, rubber, sugarcane, oil palm, cocoa and mango all important commodities produced. The main staple crops are maize, rice, sweet potato and cassava. Over the last ten years the greatest increase in cultivation of the major crops has been seen in cocoa, rubber, tobacco and pineapple, while sweet potato and maize areas have declined on average, and rice has only seen a minimal improvement. The country is however one of the most exposed in the world to tropical cyclones, affecting plantation crops in particular. The impact on the country from climate change is a significant cause for concern.

For a country that has a reasonably well-developed chemicals industry, there is little manufacture of agrochemicals, although there is significant agrochemical formulation capability, with almost 20% of imports being of technical material. The major source of product is China, Indonesia, the EU, India, Malaysia, South Korea, Japan, U.S. and Thailand, although there are many local distribution companies.

INDONESIA

Indonesia is major producer of a wide range of agricultural tropical products, and although agriculture’s share of the country’s gross domestic product has declined markedly during the last five decades, it still provides income for the majority of Indonesian households. Indonesia has a relatively large and steadily growing population, contributing to rising demand for agricultural produce. Much of the growth in population has been in urban centers, with the Indonesian urban population now accounting for almost 60% of the country’s total population.

Indonesia’s mountainous terrain and position straddling the equator enables cultivation of a large variety of crops, with the most important arable crops in terms of area being rice, maize, cassava, and soybean.

The country also grows a wide array of fruits and vegetables, with the most important being mangoes, onions, chillis, peppers, bananas, and citrus, and the country also has an important plantation sector led by oil palm, with rubber, coconut, cocoa, coffee and tea also important.

An increasingly large and developing population means that demand for food is rising in Indonesia, and this is expected to benefit the agrochemical industry, with more area being required to meet the needs of the population and emerging middle classes. This could potentially drive growth for increased usage of crop protection products to produce high quality fruit and vegetables.

A recent trend of increasing wheat imports has been evident, as people switch from rice to bread as a staple, a situation often associated with developing economies.

Although this has the potential to have a depressive impact on demand for rice, and subsequently the rice agrochemical market, the increasingly large population is expected to maintain demand for rice.

Self-sufficiency driven policies from central government are expected to help drive growth; with planted areas expected to increase for crops such as rice, maize and soybeans. Fungicide use has been rising in the country, and with the current maize fungicide market being extremely limited there remains strong potential for growth in this sector.

Another factor which is expected to benefit the market for crop protection products in the country is the increasing cost of labor. This is leading to many growers to switch away from manual tasks such as hand weeding towards increasing usage of crop protection products. This situation can be expected to continue in the short term, with product use intensity still some way behind many other nations in the region.

The oil palm industry is coming under increasing pressure over concerns regarding deforestation and destruction of wildlife habitat. Any widespread reduction in oil palm consumption arising from these concerns could have a detrimental effect on the industry and put pressure on prices. However, palm oil prices have been rising in 2025, but below peak levels. This may benefit the crop protection market as growers are incentivized to expand planted areas and spend more on inputs to protect their crops and take advantage of these rising prices.

The rice crop protection market can also be expected to continue to rise in the near term, driven by increasing demand. The country is generally self-sufficient in rice and can normally meet requirements with domestic production, although imports are still utilized in order to keep internal stocks replenished.

With the need to feed a rapidly expanding population, there remains the prospect that domestic production could soon be insufficient to meet demand unless yields increase substantially. In addition, small-holder farms dominate the rice production sector in Indonesia, with the average farm size being only 0.8 hectares. As a result, in recent years the Indonesian Chamber of Commerce in cooperation with local companies has initiated partnership programs with smallholder rice farms to increase production through the use of new technologies and financing aids. This can be expected to boost the value of the rice crop protection market moving forward.

As a result of the above factors, the value of the Indonesian crop protection market is expected to grow at an average rate of 5.0% per annum between 2024 and 2029 in dollar terms, ahead of the forecast for the overall market in this timeframe.

VIETNAM

As with several other Southeast Asian markets, Vietnam has been developing rapidly over recent decades, with a significant increase in GDP partly being driven by the increasing importance of industries other than agriculture, and an associated increase of the urban population as people relocate to cities for employment. Despite this, agriculture remains an important part of the Vietnamese economy, accounting for more than 12% of the country’s GDP. Of the country’s 98.9 million people, approximately 60% live in rural areas, down from over 75% at the turn of the century.

Vietnam’s agricultural sector is export-led, with the key commodities being rice, coffee, rubber, bananas, sugar and fruit & vegetables. Government-led initiatives have driven the importance of exports to the Vietnamese economy and have transformed the country from being a net rice importer to becoming one of the leading exporters of the crop. The primary agricultural areas in the country are the Mekong and Red River deltas in the South and North, respectively, however, the nation’s mountainous terrain allows for the cultivation of a wide variety of produce, with the Northern midlands and mountain areas, Northern Central area and Central coastal area and Central Highlands important for a variety of crops. Climatic conditions vary geographically, with the North experiencing defined rainy and dry seasons, and the south experiencing more tropical conditions.

Agriculture remains a significant part of Vietnam’s economy. Government initiatives to drive agricultural exports and to reduce the reliance on imported produce have benefitted growers, with additional benefits to the crop protection market. Rice dominates crop protection product sales, however, growth in other crops, such as maize and plantations, has boosted the overall value.

Rice remains the key crop in Vietnam, and rising export demand has resulted in growers increasing their intensity of production, both through the usage of more inputs and through minimal to no crop rotation. While the government heavily subsidizes rice production, the lack of crop rotation is expected to continue, and this could lead to high levels of insect and disease pressure, boosting the crop protection market for use on the crop.

Extreme weather events and climate change pose a rising and substantial threat to the development of Vietnam’s agricultural sector. Rising temperatures are likely to shorten plant growth cycles in the North, and severe water shortages could lead to significant reductions in yields. The country’s most productive agricultural area, the Mekong Delta, faces growing threats from sea-level rise and associated saltwater intrusion, which could limit production of some crops. In 2024, Typhoon Yagi made landfall in Vietnam on 7th September and was Asia’s most powerful storm so far this year. Estimates suggest that Vietnam’s economic growth in 2024 may slow by 0.15% compared to the previous forecast due to the impacts of the typhoon. The government had previously forecast a 6.8-7.0% expansion for the country this year, with agriculture and forestry and fishery among the hardest hit sectors. Floods have impacted 190,000 hectares of rice fields and 48,000 hectares of cash crops such as maize and cassava.

The Vietnamese government has increased its focus on market liberalization in recent years, with the country being a member of a number of free trade agreements with more than 56 countries, including TPP and the EU-Vietnam free trade agreement. This brings with it reduced tariffs and the removal of certain trade barriers, with exports from Vietnam benefiting accordingly. This continued focus on exports should benefit the crop protection market as growers aim to maximize yield and crop quality.

Vietnamese agriculture is relatively dynamic, with growers switching to more profitable crops with swings in prices and costs, and this could have an impact on product usage, particularly in crops such as sugarcane, pepper, coffee, rubber and cocoa, which tend to compete for area.

Product choice could become an issue moving forward, as the country’s Ministry of Agriculture and Rural Development (MARD) has recently implemented bans on several significant products, including glyphosate, paraquat and 2,4-D and the insecticides chlorpyrifos and fipronil. The country is also in the process of phasing out several active ingredients, including acetochlor, atrazine, benfuracarb, carbaryl, carbosulfan, chlorothalonil, mancozeb, maneb, propineb, streptomycin, thiodicarb, zineb and ziram. With these products coming off the market, there could be an opportunity for newer technologies. In addition, MARD has announced plans to reduce the number of chemical pesticide brands registered in Vietnam by 30%, intending to replace these products with biological alternatives.

As with many other countries globally, Vietnam is starting to place an increasing focus on sustainability across all sectors, including agriculture. The country initiated a large project in 2023 for the sustainable development of 1 million hectares specializing in high-quality and low-emission rice cultivation to support green growth in the Mekong Delta. More focus on sustainable agricultural practices opens up opportunities for higher value and lower volume products, biological products and technologies such as drones and formulation technologies to improve product use efficiency.

Continued economic development and increased intensity of product usage are expected to benefit the Vietnamese crop protection market in the coming years. Positive political incentives, increased demand for high quality produce and demand from export markets are expected to drive crop protection usage and technification, with associated benefits on the market in the country.

Based on the above factors, the Vietnamese crop protection market is expected to increase at an average annual rate of 2.3% per annum between 2023 and 2028 to reach $967 million, ahead of the expected industry average over this timeframe.  •