New Agrochemical Introductions and their Market Impact in Recent Years 10th China International Forum on Development of Pesticide Industry Shanghai March 8 th 2016 Phillips McDougall Ltd. An Informa Company Vineyard Business Centre Saughland Pathhead Midlothian EH37 5XP Tel : 01875 320611 info@phillipsmcdougall.com March 2016 1
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Agrochemical Market Development $m 70000 60000 50000 Agrochemical Market 40000 30000 20000 10000 0 25.5 % 26.1 % 21.3 % Patented Products March 2016 2
1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 New Active Ingredient Introductions No.of Products 25 20 15 10 5 0 March 2016 3
Agrochemical Active Ingredients in Development a.i.s in development 80 70 60 50 40 30 20 10 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 March 2016 4
Agrochemical Patent Activity 350 300 Number of world patents 250 200 150 100 50 0 2008 2009 2010 2011 2012 2013 Patents are based on new active ingredients or chemistry families and excludes new formulations, combinations or mixture products based on existing chemistry March 2016 5
Active Ingredients Introduced 2007-2014 No. Introduced Sales 2014 $m Market Share % Average Sales per product $m No. with sales >$100m Herbicides 17 1136 4.3 66.8 4 Fungicides 22 1130 6.9 51.4 4 Insecticides 16 2775 14.9 173.4 4 Others 1 10 0.6 10.0 0 Total 56 5051 8.0 90.2 12 March 2016 6
Recently Introduced Insecticides with Sales >$100m Active Ingredient Introduction Class / Mode of Action Flubendiamide 2007 Ryanodine Receptor blocker Spinetoram 2007 Biological - Fermentation Product Chlorantraniliprole 2008 Ryanodine Receptor blocker Main Crops Soybean Cotton F&V Maize F&V Soybean F&V Rice Cotton Maize Main Markets Brazil Argentina India China USA Japan Mexico Brazil India China Spirotetramat 2008 Ketoenol F&V USA Europe China March 2016 7
Recently Introduced and R&D Insecticides with Significant Commercial Potential Active Ingredient Introduction Class / Usage Sulfoxaflor 2012 Sucking pest control Cyantraniliprole 2012 Ryanodine Receptor blocker Flupyradifurone 2014 Systemic sucking pest control, with seed treatment activity Afidopyropen R&D Systemic sucking pest control, with seed treatment activity Tetraniliprole R&D Ryanodine Receptor blocker March 2016 8
Recently Introduced Fungicides with Sales >$100m Active Ingredient Introduction Class / Main Crops Main Markets Mode of Action Mandipropamid 2007 Oomycete F&V USA Europe Brazil Bixafen 2010 SDHI Cereals Europe Fluxapyroxad 2012 SDHI Cereals Soybean Maize Penflufen 2012 SDHI Canola F&V Cereals Europe USA Brazil Canada USA Europe March 2016 9
Recently Introduced and R&D Fungicides with Significant Commercial Potential Active Ingredient Introduction Class / Usage Fluopyram 2012 SDHI Benzovindiflupyr 2013 SDHI Oxathiapiprolin R&D Oomycete Pydiflumetofen R&D SDHI March 2016 10
Recently Introduced Herbicides with Sales >$100m Active Ingredient Introduction Class / Main Crops Main Markets Mode of Action Tembotrione 2007 HPPD Maize Brazil USA Europe Pyroxsulam 2007 ALS Cereals Canada USA Europe China Thiencarbazone methyl 180 ALS Maize Cereals USA Europe Saflufenacil 140 PPO Maize Soybean Cereals USA Canada March 2016 11
Recently Introduced and R&D Herbicides with Significant Commercial Potential Active Ingredient Introduction Class / Usage Pyroxasulfone 2011 Isoxazoline (use on resistant weeds) Fenoxasulfone 2014 Isoxazoline (use on resistant weeds) Halauxifen 2015 Pyridine (low application rate) Rinskor R&D Pyridine (new mode of action for rice) March 2016 12
Key Drivers of R&D and Opportunities for New Products Resistance Development Herbicides Glyphosate Post emergence grass weed control in cereals (ALS / ACCase) Fungicides Asian rust to Strobilurins Septoria to Strobilurins Oomycetes co-formulation with contact products Insecticides Helicoverpa Corn rootworm to B.t. Regulatory Neonicotinoids in the EU Endocrine disruptors Product substitution in the EU New Modes of Action Single site activity / resistance development Biologicals No residues / withholding periods March 2016 13
Patented v Generics March 2016 14
2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989 1988 1987 1986 1985 1984 1983 1982 1981 1980 1979 1978 1977 1976 1975 1974 1973 1972 1971 1970 1969 1968 1967 1966 1965 1964 1963 1962 1961 1960 1959 1958 1957 1956 1955 1954 1953 1952 1951 1950 Proprietary v Off Patent Market Share - 2014 Patented 21.3% Off - Patent 78.7% Proprietary 21.3% Proprietary Off Patent 20.9% Generic 57.8% Sales $m 7000 6000 5000 4000 3000 2000 1000 0 March 2016 15
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Proprietary v Off Patent Market Share % 60.0 50.0 Generic 40.0 30.0 Proprietary Off-Patent 20.0 Patented 10.0 March 2016 16
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Generic Companies Share of World Market Market Share % 35.0 30.0 Total Generics 25.0 20.0 Generics excluding Glyphosate 15.0 March 2016 17
Market Development March 2016 18
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 12.0 10.0 8.0 Crop Protection Market Real Growth 1990-2014 Improved Crop Prices Europe, 5% set-aside LAM Recovery / Asian Rust Excellent Ag year in the USA El Nino Freedom to Farm GATT Strong Commodity Prices Biofuels / High oil prices Recovery in Brazil GM Crop Expansion Weak Commodity Prices Adverse weather Energy Prices Brazilian economy 10.2 High Crop Prices Rising food demand Higher Glyphosate Prices 9.9 8.9 7.1 6.0 4.0 2.0 0.0 EU CAP Reform 2.2 4.3 3.7 2.1 0.1 4.7 2.8 0.2 4.5-2.0-4.0-6.0-8.0-0.5-3.0-1.6-0.5-5.7-1.0-6.8-5.0-1.6-2.5-6.5-1.5 Lower Commodity Prices Reduced oil prices Global economic weakness Lower glyphosate prices Distributor inventory GM Crops Weak Crop Commodity Prices Reduced Support LAM / Asian Economies Weak March 2016 19
Crop Protection Market Real Growth v Crop Prices Crop price Real growth rate 450 12 Mean crop price $ per tonne 400 350 300 250 200 10 8 6 4 2 0-2 -4-6 Crop protection market real growth (%) 150 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014-8 Note: Crop price is mean value of global corn, soybean and wheat price March 2016 20
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Crop Protection Market in 2014 Dollar Terms $m 62000 60000 58000 56000 54000 52000 50000 48000 46000 44000 42000 40000 38000 36000 34000 32000 30000 Forecast Real Growth 2014 to 2019 2.6% p.a. March 2016 21
Disclaimers The information contained in this presentation constitutes our best judgement at the time of publication, but is subject to change. Phillips McDougall do not accept any liability for any loss, damage or any other accident arising from the use of the information in this presentation. The information given in this presentation has been drawn from analyses and reviews presented in the Phillips McDougall products AgriService, Seed Service, GM Seed Product Database, AMIS Global and AgreWorld. Phillips McDougall maintain a wide range of databases covering the crop protection and seed industries, this presentation presents only headline information. Access to these databases can be gained through subscription or consultancy. Our market research databases track product sales from global market totals down to brand level sales by crop and country in both volume, value and area treated terms. For more information about these products please visit www.phillipsmcdougall.com www.agreworld.com March 2016 22