Navigating the Agrochemicals Industry in South Africa

The importance of the agrochemical manufacturing industry for South Africa

South Africa’s agrochemicals industry plays an important role and contributes directly to the agricultural sector, which accounts for approximately 2.5% of GDP. Beyond direct contributions, the industry supports agricultural productivity, employment and rural development, and ensures food security.

According to the WOW report on the manufacture of agrochemicals, the industry is growing steadily, but it faces numerous challenges. It is compelled to find innovative and sustainable production methods to boost land productivity and offset the effects of overuse of these chemicals, which can harm the environment and human health.

The agrochemicals sector encompasses a wide range of products, including fertilisers, pesticides, herbicides and plant growth regulators. Countries around the world are looking for solutions to balance the use of pesticides, agrochemicals and fertilisers to combat soil degradation, which can change soil composition and disrupt the balance of microorganisms in the soil.

According to the latest estimates by the Global Environment Facility, about 95% of the earth’s land could become degraded by 2050, while UN estimates show that 40% of all land is already degraded.

According to Science Direct, unbalanced application of agrochemicals leads to environmental degradation and poses numerous challenges to agricultural ecosystems and soil health. The key challenge is to balance improved agricultural production with the safe usage of agrochemicals.

Trends in the Agrochemicals Industry

There is a shift towards precision agriculture and the use of biotechnology and digital solutions which can improve efficiency, reduce environmental impact and improve resource use.

The call for sustainable agricultural practices driven by climate change is compelling countries to adopt eco-friendly and bio-based agrochemicals to align with global sustainability goals and consumer demand for products with less harmful chemicals.

Regulation in the agrochemical industry

The industry is highly regulated with very strong associations such as Crop Life South Africa and Agri-Intel which represent the industry and support the plant protection manufacturing industry to mitigate risks and promote sustainability.

The Genetically Modified Organisms Act (No. 15 of 1997) provides regulatory oversight to ensure rigorous safety assessment of biotech crops. CropLife South Africa acts as a liaison between the Department of Agriculture and the plant science industry to ensure compliance with and enforcement of this Act.

Despite stringent regulation that may hinder industry growth, the country is still plagued by an increasing number of illegal pesticides being sold. Food for Mzansi reported in 2023 that illegal pesticides are increasingly being sold, often looking like legitimate products but with poor quality content.

According to the WOW report on the manufacture of agrochemicals and pesticides, South Africa’s usage is higher than the global average of 2.26kg/ha (2020:2.18kg/ha), and substantially higher than the African average of 0.70kg/ha (2020: 0.70kg/ha). Between 1990 and 2021, South Africa’s usage of pesticides increased by 170% from 1.27kh/ha to 3.43kg/ha compared to an 85% growth in global usage and a 94% increase in Africa.

Challenges Facing the Agrochemicals Industry

Balancing innovation and product safety requires a sustainable approach to innovation in product development, while adhering to regulation.

Price volatility of raw materials, currency fluctuations and global market trends affect profitability and competitiveness in the industry and remain a challenge.

Smallholder farmers struggle to access affordable and suitable agrochemicals, limiting their productivity and income potential. This contributes to the knowledge gap on the best use of biopesticides as an environment friendly alternative. Known methods to achieve higher yields that are not necessarily sustainable tend to prevail.

Strategies for sustainable growth of agrochemicals

• Public-private partnerships can encourage investment in research and development, foster innovation in agrochemical formulations, reduce reliance on harmful chemical inputs for pest control and improve agricultural production.

• Technical support to farmers, particularly new entrants to the industry on safe and effective use of agrochemicals can promote sustainability practices and enhance productivity.

• Improved collaboration between government, industry stakeholders and research institutions through enabling technology transfer can contribute to sustainable agricultural development.

• African trade and cooperative agreements offer South Africa an opportunity to become a leader in crop protection manufacturing, helping Africa to become globally competitive.

If there is no balancing of economic growth requirements with environmental stewardship and societal wellbeing, enabling regulation that combats the use of illegal chemicals for the country, envisaged growth cannot be achieved.