The agricultural and environmental benefits associated with microbial solutions are the major factors contributing to the growth of this market, globally. In comparison to their chemical counterparts, microbial solutions are very target-specific. They are safe for use and pose no hazard to the environment, unlike chemical pesticides, since they do not leave behind any chemical residues on the plant. The agricultural microbials market is projected to reach USD 6.01 billion by 2022, at a CAGR of 14.21% from 2017.
Advances in microbial technology for pest control, favorable and faster processes for the registration of agricultural microbials in North America, stringent regulations regarding the use of chemical pesticides, and the ban of several traditional pesticides in Europe are expected to play a significant role in the market growth of agricultural microbials.
However, the absence of systematic rules and protocols for the approval of agricultural microbials and overlap of regulations for these products with crop protection pesticides result in delayed product approvals in key markets such as South America and Europe. The proposals for improved regulatory governance of agricultural microbials, especially crop protection, if amended, could remove the entry barriers faced by the small and medium-sized enterprises, and thus, spur market growth.
Europe is projected to be the fastest-growing region in the agricultural microbials market from 2017 to 2022. Europe had the second-largest area under organic cultivation and accounted for around 25% of the world’s organic land as of 2015. Owing to the increasing number of bans on chemical products in European countries and the organic farming culture prevailing in this region, the region will see a high acceptance of agricultural microbials.
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Market Dynamics
Driver: Rising adoption of integrated pest management (IPM) practices across the globe
Over the last five decades, IPM has become the recognized strategy for crop protection, globally. IPM involves effective control of pests through several compatible, integrated, cost-effective, and eco-friendly methods. It is considered a principal component of sustainable agriculture practices. The biological method of pest control is an important component of IPM. Biopesticides reduce the usage of conventional pesticides, while at the same time promote higher crop yield with effective pest control. It is an essential component in the production of various greenhouse crops. The market shares earlier held by synthetic crop protection chemical is gradually being replaced by biopesticides, which contribute to the growth of this market.
The continuous and extensive use of modern crop protection products to eradicate or reduce pest infestation and the loss caused by them has led to the development of resistance to the effect of crop protection products among pests. This resistance can be classified as metabolic resistance, target-site resistance, penetration resistance, and behavioral resistance. Biopesticides, mostly microbial pesticides, are used as an effective tool in IPM programs for management of pest resistance to conventional chemical pesticides.
Microbial pesticides also reduce environmental and worker exposure to synthetic pesticides. Nematode pest management, through the usage of microbial agents, is being recognized as a promising area in the current scenario of IPM practices. The renewed emphasis on IPM as a component of agricultural policy in regions such as Europe has also led to changes in the way biopesticides are regulated.
Restraint: Shorter shelf life, field persistence, and storage conditions of microbial pesticides
Agricultural microbial products mostly contain living material; hence, they have a shorter shelf life as compared to conventional chemical products. For example, Bt. has a shelf life spanning from 6 months to 2 years whereas conventional pesticides have a shelf life ranging from 2 to 4 years. On the production and distribution end, the shelf life is dependent on some factors such as manufacturing technology, carrier, packing material, mode of transport, and distance.
The survival of microorganisms during storage is a major problem in agricultural microbial products. The seasonal and unpredictable nature of pesticide demand requires effective storage, which includes special skills and facilities, which are not possessed by shopkeepers, producers, and farmers. Also, microbials are easily affected by various biotic and abiotic factors in farm fields, as they are naturally occurring organisms or substances. This directly affects their efficacy in the field, which can become low or inactive. This serves as a restraint for the market.
Opportunity: Significant development in the seed treatment segment
The seed treatment market is projected to grow at an exponential rate due to factors such as the increasing demand for sustainable agricultural practices, integrated pest management, favorable government regulations, increasing demand for high-value crops, and rise in the number of investments from key players in this market. The market for seed treatment was valued at USD 6.8 billion in 2017; it is projected to grow at a CAGR of 10.8% from 2017 to 2022. Seed protection is the major function targeted by larger companies in the seed treatment market. The application of micronutrients and biofertilizers through seed treatment is being adopted increasingly across the globe.
Challenge: Regulatory barriers
Laws regulating the registration and commercialization of agricultural microbials are a major hindrance for their development. Inappropriate regulation impedes the adoption of agricultural microbials and denies the farmer access to these microbial products. The regulations governing microbial crop protection are stricter than those governing agricultural microbials for soil enhancement. Biopesticides are generally regulated by the framework designed for synthetic or chemical pesticides. Moreover, the regulations for the registration of agricultural microbials are not uniform across different regions making it challenging for medium- and small-sized enterprises to expand their market share. Import and export of biopesticides are also major deterrents; chemical pesticides are relatively easy to trade.
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Europe has the most complicated regulatory framework for the registration of agricultural microbials, which is not in tandem with the growing demand for organic and residue-free food in the country. South America, though a growing region for crop protection microbials, has a challenging regulatory framework from the registration point of view. Such regulatory barriers pose challenges for market growth.
