The global agricultural inoculants market is projected to register a CAGR of 9.5% during the review period. The growth of the market can be attributed to the growing demand for organic products and promotion of organic farming by government authorities and organic trade associations. Market players are expected to witness profitable growth opportunities in the global market due to the increasing adoption of organic farming practices in emerging economies.
The key players operating in the global agricultural inoculants market include Corteva, Inc. (US), BASF SE (Germany), Bayer AG (Germany), Novozymes A/S (Denmark), Brettyoung (Canada), Rizobacter Argentina S.A. (Argentina), Italpollina S.p.A. (Italy), Advanced Biological Marketing Inc. (US), Soil Technologies Corporation (US), Verdesian Life Sciences, LLC (US). The market comprises tier-1, tier-2, and local players. The tier-1 and tier-2 players have a global reach along with diverse product portfolios. Companies such as Corteva, Inc., BASF SE, Bayer AG, Novozymes A/S, and Rizobacter Argentina S.A. dominate the global market due to brand reputation, product differentiation, financial stability, and diversified regional presence.
The players are focused on investing in research and development and adopting strategic growth initiatives such as acquisitions, product launches, partnership, collaborations, and expansions to strengthen their market position and capture a large customer base.
Threat of New Entrants
The agricultural inoculant business is highly competitive with the presence of many key global and regional based players specialized in agricultural science. Initial investment associated with agricultural inoculants business is high due to high raw material cost; however, the revenues are also high considering to high demand for foods and growing trend of organic food and horticulture crops. Additionally, high production cost in agricultural inoculants business due to greater labor inputs and technological advancements also restricts many new players to enter into the agricultural inoculants business. Additionally, stringent norms related to certification for agricultural inoculant production across the globe also restricts many emerging players to enter into the agricultural inoculants business. Hence, the threat of new entrants in the global agricultural inoculant market is expected to be low during the forecast period.
Bargaining Power of Suppliers
Suppliers of agricultural inoculants are the distributors and wholesalers, importers and independent suppliers supplying via online retails. Suppliers tend to have low bargaining powers due to the presence of well-established competitors. Owing to the presence of numerous suppliers, the switching cost of the end consumers becomes low. This tends to lower the supplier’s power. Suppliers need to maintain a strong relationship with the key buyers in terms of product quality and after-sales service and many among others. Additionally, suppliers need to differentiate their products in terms of formulation, sourcing, and product functionality and match it as per its client’s requirements. The inefficiency of the suppliers in meeting the buyers’ requirements results in an immediate switch to different suppliers. This lowers the bargaining power of suppliers. Hence, the bargaining power of suppliers in the global agricultural inoculant market is expected to be low during the forecast period.
Bargaining Power of Buyers
Bargaining power of buyers is the pressure that the consumers exert on businesses to procure higher quality products, better customer service at lower prices. Rising demand for agricultural inoculants for increasing productivity coupled with increasing shrinking arable land is exerting pressure among the manufacturers, distributors to provide quality products at an affordable rate. Additionally, increasing trends for organic products and horticultural crops is driving the demand for agricultural inoculants. All these factors are helping in increasing the power of buyers. Moreover, manufacturers of agricultural inoculants are increasing at a considerable rate seeing a lucrative opportunity. With the increasing number of manufacturers, the switching cost of the buyers becomes less. This increases the bargaining power of buyers. Hence, the bargaining power of buyers in the global agricultural inoculants market is expected to be moderate during the forecast period.
Threat of Substitutes
With growing environmental concerns and increasing health awareness, consumers prefer natural alternatives over synthetic chemicals. The natural alternatives cover a wide range of options and are preferred by commercial organic growers. The close substitute for agricultural inoculants is the bio-fertilizer. Additionally, many established players in the agricultural inoculants are constantly indulging in R&D activities and finding new techniques to develop new products that are chemical-free. However, all these efforts have a substantial cost associated with it and hence makes the threat of substitutes moderate. Hence, the threat of substitutes in the global agricultural inoculant market is expected to be moderate.
Intensity of Rivalry
The agricultural inoculant industry is marked by high intensity of rivalry. The global market players in the agricultural inoculants industry indulge in a fierce rivalry where the market players are aggressively targeting its competitors in terms of quality and price, thus making the industry more competitive and reducing profit potential for the existing firms. Hence, the intensity of rivalry in the global agricultural inoculant market is expected to be high during the forecast period.
