Brazilian market expands concentration of large agrochemical companies

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Brazilian market expands concentration of large agrochemical companies

2018-05-23

The Brazilian agrochemical market has been increasing its concentration on large international companies, to a point that it would transform into something worse than an “oligopoly”. This is the assessment of the executive-director of the Brazilian Association of Generic Pesticides, agronomist Tulio Teixeira de Oliveira.

“When the market is dominated by few competitors, we denominate the market phenomenon as an oligopoly. And this oligopoly stays stronger, restricting further the space for competitors. So, that is just what is happening in the Brazilian agrochemical market, one of the largest in the world,” he said.

From 2015 to 2017, this industry sector kept around US$9 billion each year in Brazil, which indicates that Brazil alone represents 15% of the global market for these products. “In these three years, the top nine companies had 70% of sales for Brazilian agriculture, which is already big and has possibilities to grow significantly,” said Oliveira.

According to the director, next year, the concentration will be even bigger because the companies that own the largest slice of the market will be reduced from nine to only five. “There was the fusion between Dow and DuPont, and now Bayer purchased Monsanto. Syngenta and Adama, even though they are separate, represent only one: ChemChina. A little while ago, FMC had captured ChemChina, and more recently, acquired the fair share defined by the government in the Dow-DuPont procedure. Therefore, the companies that have 70% of the Brazilian market of phytosanitary products are Bayer, Syngenta/Adama, Corteva (Dow/DuPont), BASF and FMC,” he added.

According to him, the term “owners” is not a language error or exaggeration, but because the “domination is overwhelming, the spaces for other companies should be called cracks”.

“Capitalism presents itself as a system of freedom, opposed to socialism, defined as autocratic. However, in practice, it is the freedom of those who can do more, those who have bank investments to lend benefits to customers, those who can transact agricultural products with distributors of one region, those who organize more international travels with technical inter-exchange for their main customers, and those who have a legion of salespersons and field technicians available for farmers, all within the legality. I’m only drawing the reality of our time: an unequal society and without perspective of change towards a more humane organization,” concluded Oliveira.

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