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BioAgri - 2023

There has been a steady and growing realization that biologicals are here to stay because of all the benefits of using a biological – the increase in biodiversity and soil health and reduction in greenhouse gases and carbon footprint.

The good news is we are hearing more about measuring return on investment (ROI), where it is not just the price per jug/ price per acre or hectare, but rather what yield and quality increase that input cost gets you.

On another note, given the pressure on chemical pesticides and the innovation and increased performance of biologicals, larger companies continue to invest in biologicals through collaborations and M&A activity. Valuations continue to be quite robust on the private side, while the public markets have been terribly unfavourable for the whole ag biotech sector, with record low valuations. Sustainable agriculture and the biologicals sector are very dynamic and will continue to change rapidly. What worked in the past is not necessarily how to operate going forward.

Indian agriculture is particularly fascinating. Made up of small farmers and a diversified supply chain, it stands as a prime stage for showcasing the power of biologicals and the hopes of a more sustainable future for the whole world.

Agriculture is a vital organ in India’s economy. Fifty- eight percent of the nation’s total workforce is engaged either directly in agriculture or allied sector activities. Specifically, this accounts for 18.8% of the country’s Gross Value Added (GVA) and is estimated at INR 19.48 lakh crore (US$ 276.37 billion) in FY20.

India spans a total geographical region of 328.7 million hectares, of which 139.4 million hectares is the reported net sown area. Another 200.2 million hectares is the gross cropped area with a cropping intensity of 143.6%. The net area sown accounts for 42.4% of the total geographical area, with a net irrigated area of 68.6 million hectares.

BioAg Inputs in Indian Agriculture

With so much food and farm-related activity, India is naturally a hotbed for agri-inputs of all kinds to enhance crop productivity. With an increase in innovation and interest in the organic and natural market sectors, there is more room for companies in this sector to thrive.

With the Government of India emphasizing “The Natural Farming” approach, it has inevitably boosted the usage of various BioAg inputs generating great interest amongst the national farming community.

The corporations are realizing that for sustainable agriculture and to mitigate the rising climatic deviations, excess usage of chemical fertilizers affecting soil conditions has only forced them to expand towards the biological sector.

As a whole, agriculture is moving towards biological agriculture due to climate resilience and the ill effects of chemical-based farming practices.

The economic benefits to the farmers, health benefits to the consumers and safety to the environment ensure BioAg inputs as the most sought-after products. Their sustained use further rebuilds soil health, fertility, and makes it carbon-rich, thus, becoming an inevitable tool in modern agriculture. India became a pioneer in world agriculture to innovate, standardize and promote world-class agri-inputs through its well-defined regulatory framework, infrastructure and technology know-how.

India has massive potential as a sourcing hub for bio- logicals

So, where are these products finding a home in India? Consider that the organic food segment in India is expected to grow at a CAGR of 10% during 2015-25, and is estimated to reach INR 75,000 crores (US$ 10.73 billion) by 2025 from INR 2,700 crores (US$ 386.32 million) in 2015.

According to the Union Ministry of Agriculture and Farmers’ Welfare, 2.78 million hectares of farmland were under organic cultivation as of March 2020. This is 2% of the net sown area in the country. The top state that accounts for the largest area under organic cultivation, Madhya Pradesh, has only around 4.9% of its net sown area under organic farming.

Going forward, adopting food safety and quality assurance mechanisms will help boost BioAg inputs’ usage in agriculture along with digitization and traceability applications.

With the focus on plant, root, soil health, and seed treatment, biopesticides, biofertilizers, and bio stimulants are essential for sustainable agriculture and organic farming.

BioAg solutions is a “sunrise industry” and bound to grow given the following:
  • Consumer preference for organic and chemical-free food
  • Need to prevent soil and water depletion caused by climate change and chemical usage
  • Value chain development for domestic and export markets
  • Contract farming offers a value capture mechanism Export possibilities

India’s Key Strategies to Enhance Biological Market Share and Presence

There are many ways companies, stakeholders and farmers involved in Indian agriculture can further promote the market share and presence of biological products of all varieties. By growing the acceptance and usage of biologicals in this country, the rest of the world will soon take notice and follow.

A good step for companies is to begin by identifying the target market for their products. Not all markets (and market segments) in India are equal, and not all are ready for biologicals. The key is to choose where to focus - understand your resources and ability to deploy them.

Fortunately, there are increasing niche markets for organic, chemical-free, value chain, greenhouse, and export-oriented crop production. Besides these hot markets, companies should also be on the lookout for markets where pests have developed resistance to chemical pesticides or other technologies where current control is not satisfactory.

Another great place for BioAg inputs to grow is where chemical residues on produce are a limiting factor. Schedules that combine chemical input followed by biological products nearer to harvest or a tank mix of lower doses of chemicals and biologicals can work.

The India Biostimulants Market

Even though we included Biostmulant trends in The India biostimulants market is projected to grow at a CAGR of 14.06% during the forecast period to reach US$145.947 million by 2027, from US$58.112 million in 2020. Increased demand for organic food is expected to drive the market for biostimulants in India.

According to the Research Institute of Organic Agriculture (FiBL) and International Federation of Organic Agriculture Movements (IFOAM) Organics International Report 2021, India ranks first in Asia and fifth globally with 23 lakh hectares under organic farming. Moreover, as per a FiBL report from 2021, India expanded the fastest by adding about 3.6 lakh hectares of organic land. It also expects India’s organic industry to grow faster, owing to the increased demand for organic products during the COVID-19 outbreak.

Biostimulants play a significant role in crop nutrition and crop protection in organic farming and gardening. This momentum is projected to grow in strength and force in the coming years because consumers are increasingly gravitating toward healthy and organic foods. In addition, India has around 15,000 certified organic farms, according to the International Fund for Agriculture and Development (IFAD).

Major developments by the government and key players in the market will further accelerate the growth of biostimulants in India.

The Indian government announced in April 2021 that biostimulants would be governed by the same standards that regulate fertilizer and other crop nutrients used to boost soil health. This will aid in the regulation of the 1,500 crore biostimulant sector, which promises farmers increased yields, quality, and other benefits through the usage of various chemicals and microbes.

Such schedules should be worked out with farmers and influencers.

In addition to this, we need separate action plans for geographies with high and low chemical use and to develop separate strategies for hybrids and OPVs.

With that in mind, here are some additional consider- actions for the proliferation of BioAg inputs in India:
  • Research and product innovation: Every product has to be unique and different from others. It should add value to the farmer and address a problem that farmers face – market-driven product development is the key –continuous enhancement of offerings, including new formulations.
  • Balanced product portfolio: Develop products for niche markets and wider applications separately.
  • Maintain high product quality standards: Consistent and high quality with distinct efficacy. Be sure that there is no contamination with chemicals.
  • Ability to create new markets: - Gaining market share by creating demand – on groundwork/demos, continuous engagement workshops, training - focus on market segments where adoption could be faster and solve the problems of the farmer.
  • Ability to demonstrate value proposition of the products: A community approach in villages to promote bioproducts is optimal.

Of course, all of the above must be accompanied by key strategic partnerships with companies who have an established business in the biological space.

As a whole, India is rife with exciting opportunities for the entire BioAg community. Besides the markets and the need, it also has a vast talent pool full of scientists, technologists, and business professionals with the tools to take the reins of the future of biologics domestically and beyond.

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