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Ch. Prashanth Reddy

HYDERABAD, July 9

EVEN as the Mahyco-Monsanto combine is spreading the cultivation of Bt cotton, which is resistant to bollworm, `Tracer', a new generation insecticide used to control the bollworm pest, which causes extensive damage to the cotton crop, has emerged as the largest selling pesticide in the country during the current fiscal.

According to market sources, De-nocil Crop Protection Ltd, a joint venture between Nocil and DowElanco, a global leader in crop protection chemicals, has sold Rs 70-crore worth of Tracer during the first quarter of the current fiscal. The total sales of tracer are estimated to touch Rs 100 crore this year.

Hence, the advent of Bt cotton in the country is in no way a threat to the agrochemical industry at this point of time, according to Mr G. S. Raju, Director of Nagarjuna Agrichem Ltd. In this regard, Mr Raju pointed out that in Australia there had been no significant reduction in pesticides consumption following the large-scale introduction of Bt cotton. The transgenic variety, however, affected agrochemical industry in the US as Monsanto had supplied "Round-up Ready Seed".

Round-up is a non-selective herbicide called glyphosate, supplied by Monsanto along with cotton and soyabean seed, which enabled farmers to eliminate weeds more effectively.

At present, it is not Bt cotton but the continued dry spell in the country, which is giving anxious moments to the agrochemical industry. The industry did well last fiscal and had entered this year with lot of optimism. However, the "mood is down" at present due to lack of adequate rainfall in several parts of the country. The cotton acreage is also stated to be 20 to 30 per cent less when compared to last year.

Mr Raju told Business Line that there was consolidation in the agrochemical industry at the global level. Following this, Syngenta, Bayer and BASF of Europe and Dow, Dupont and Monsanto of the US had emerged as major players which together accounted for 75 per cent of the world's agrochemical business which is estimated to be $32 billion.

In India, he said, about five companies including Nagarjuna, UPL, Excel, Gharada and Rallis had the potential for growth in generic markets. But the main problem for Indian companies was that second-tier companies, which had no research and development facilities, were immediately copying the generic technologies developed by the top five companies. As the legal process was time-consuming, using legal means to "protect our technology is not workable".

Following good performance last year, Nagarjuna Agrichem share price had increased four-fold from Rs 4 in 2001 to Rs 21 today. The company had posted a turnover of Rs 85.92 crore and a net profit of Rs 8.05 crore as against a turnover of Rs 61.24 crore and a profit of Rs 1.66 crore in the previous year. The company's basic earnings per share last fiscal stood at Rs. 4.96.

Mr Raju said the combined turnover of Nagarjuna Agrichem and its associate companies, Vijayalakshmi Pesticides and Bhagiratha Chemicals, stood at Rs 250 crore last fiscal. He wanted to double this turnover during the next four years.

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Bt cotton `not threatening' agro-chemicals industry

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