Financial Daily from THE HINDU group of publications
Tuesday, Jan 18, 2005
Agri-Biz & Commodities
Agrochem cos may post better results this fiscal on export focus
Mumbai , Jan. 17
AGROCHEM companies are expected to turn in a moderately satisfying performance for the 2004-05 season so far although there was a delay in the arrival of monsoon rains.
Overall domestic sales are much better over the earlier year, higher by 12-15 per cent, industry representatives said. More importantly, crop protection companies have been exploring overseas markets to drive sales. ``A moderate year, not too good but definitely better than some of the recent bad years,'' said an official of Hikal Ltd, which is largely into exports.
In the beginning of the kharif-sowing season, there were worries about agricultural prospects as monsoon rains were delayed by a month. This had resulted in large-scale re-sowing across several states. But subsequent heavy downpour had improved the scenario for the crop protection industry.
``Despite the delay in arrival of rains the overall season was good,'' said Mr Pradeep Dave, President, Pesticide Manufacturers & Formulators Association of India (PMFAI). The rabi season has been much better than kharif for offtake of agrochemicals, he said. Demand for pesticides was strong for cotton, paddy, chillies and wheat.
Sudarshan Chemical Industries Ltd, which is in agrochemical intermediates, is also expected to turn in improved performance in this season.
However, individual companies within the crop protection industry have been able to drive exports especially for insecticide and herbicide products. According to Mr Raju Shroff, President, Crop Care India Ltd, India's strength in insecticide products gives it an advantage in the international market.
``Today a serious player in agrochemicals industry has to look at exports,'' said Mr Deepesh Shroff, who heads Excel Crop Care, the agrochemicals company of the Excel Group. Excel exports to 52-54 countries.
United Phosphorus has had a robust export of crop protection products to Europe and the US, Mr Shroff said.
India's strength is in generic pesticides, which is in demand across the world, Mr Dave said. Erratic monsoon rains impacting sowing and crop prospects in recent years have prompted companies to look at export markets to drive their revenue.
Indian agrochemical companies have been exploring newer markets across several countries. Europe is said to be a strong market for herbicide and several Indian companies are expanding their portfolio of herbicides. Export turnover of the industry is estimated to go up by 15-20 per cent, Mr Dave said.
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