Friday October 12, 2012
Research firm Kline & Company has released its Professional Turf and Ornamental Markets for Pesticides and Fertilizers: U.S. Market Analysis and Opportunities
PARSIPPANY, N.J. — With estimated 2011 sales of $1.4 billion at the manufacturers’ level, the U.S. turf and ornamental pesticides and fertilizers market began to experience some firmness, according to the recently released Professional Turf and Ornamental Markets for Pesticides and Fertilizers: U.S. Market Analysis and Opportunitie s report published by global consulting and research firm Kline & Company .
Fertilizers remain the largest product category, accounting for over 43% of total sales in 2011, with herbicides ranking second at a little over 26%, followed by fungicides with almost 16% of the total.
Golf courses, with sales estimated at near $440 million in 2011, represent the largest end-use segment among those covered by the study. Lawn care operators rank second largest with a near 28% share of sales, dropping five percentage points over the last few years. Dennis Fugate, Industry Manager of Kline's Specialty Pesticides consulting practice, observes, “Lawn care professionals and landscapers have suffered, and some have left the business due to difficult economic conditions. The market obviously depends on housing and people’s confidence in the employment picture, and these indicators have not bounced back as quickly as most experts predicted in 2008 and 2009. However, the decline in the overall market value has also been exacerbated due to continuing pressure from generic suppliers of all chemical categories.”
Supplying the turf and ornamental market, the big basics manufacturers continue to hold a strong share, claiming 50% of the market. However, this share is down an estimated 15% over the last five years as mainly second tier basics or aggressive generic companies have gained share. According to Fugate, “The big basics are continuing to adapt their newly commercialized actives for the turf and ornamental market while protecting their mature brands as strongly as possible. Despite this, the top five basics manufacturers have lost significant market share as savvy new or second-tier players using generic versions of long-time proven actives have quickly created profitable, and relatively high profile businesses.”
Due to highly competitive generic actives pricing and strong marketing efforts, the market is being devalued as cost-conscious end users in lawn care, golf, and ornamentals take advantage of the perceived cost savings. Moreover, this approach has led to extremely rapid product proliferation in all categories, but especially in golf course fungicides where the number of different products used by surveyed golf course respondents has doubled since 2006. While product offerings in other categories, such as herbicides and insecticides, have tripled, the number of product applications has remained relatively steady.
Syngenta consolidated its already strong leadership in sales with the recent acquisition of DuPont’s turf and ornamentals insecticide business. Bayer, BASF, and Dow round out the top four players, with relative newcomer John Deere (formerly Lesco) emerging strongly with the sector’s fifth largest market share.