According to the latest exclusive market insight report (FarmTrak) released by industry consulting giant Kynetec Brasil, the crop protection market in Brazil for the 2024-25 soybean growing season is experiencing a complex divergence in value and usage. The report shows that total market sales for the year contracted to US$9.45 billion, a 4.3% decline from US$9.87 billion in the previous quarter. However, surprisingly, this decline in sales contrasts sharply with the surge in field use. Potentially Treated Area (PAT), a core metric measuring pesticide coverage and frequency of use, surged 12% against the trend, breaking the 1.4 billion hectare mark for the first time, setting a new record. This seemingly contradictory data reveals that the Brazilian agricultural input market is undergoing a profound structural adjustment.

Analysis indicates that the decline in market sales is not due to a single factor, but rather the combined effects of a series of macroeconomic and market dynamics. The 7.7% depreciation of the Brazilian real against the US dollar directly eroded dollar-denominated market values. Meanwhile, the average price and cost of agrochemical products themselves fell by approximately 8%, further compressing total sales.

On the other hand, the unprecedentedly active field application was fueled by favorable weather. This quarter, particularly in the critical Cerrado agricultural region, favorable weather conditions significantly boosted crop production potential, prompting farmers to increase pesticide application frequency to ensure and boost yields. This productivity-driven application growth partially offset the negative impact of price and exchange rates.

Among product categories, the market landscape showed clear differentiation:

1. Fungicides' dominance continues to solidify: Foliar fungicides, a top priority for farmers, expanded their market share from 38% to 40%, becoming the only major category to achieve positive sales growth, reaching US$3.819 billion, a 3% year-on-year increase. In this sector, high-performance formulations representing advanced technologies accounted for nearly two-thirds of transaction value, while traditional strobilurin blends and protective fungicides contributed 14% and 13%, respectively.

2. The insecticide market faced downward pressure: Despite maintaining its position as the second-largest category, foliar insecticide sales declined 9% to $2.23 billion. Products targeting bed bugs dominated the market, accounting for 54% of the market share (approximately $1.2 billion) and covering nearly all cropping areas (96%), with an average of 3.4 applications per season. Products used to control lepidopteran pests (such as caterpillars) accounted for 30% of the market share.

3. Herbicides saw both market share and value decline: While herbicides, the third largest sector, maintained their market position, their economic performance was less than satisfactory. Their market share declined from 25% to 23%, and their sales fell to $2.18 billion. Among these, products used for pre-sowing soil cleaning and drying, represented by glyphosate, accounted for 43% of sales in this subcategory.

The report also revealed several high-growth market segments. Seed treatments maintained a stable market share of 6% (US$558 million). Notably, nematode control agents are becoming a significant growth driver, with sales reaching US$250 million. More importantly, their application penetration continues to climb, with the proportion of planted hectares covered jumping from 31% in the previous quarter to 36%, demonstrating farmers' growing awareness of soil health.

Furthermore, on the other side of the field, the adoption of biotechnology is experiencing explosive growth. Within the 46.3 million hectares of soybean planted area covered in the report (a 5.2% year-on-year increase), the proportion of varieties planted with second-generation lepidopteran pest control technology (Bt technology) surged from 11% to 24%. This exponential growth, driven by the launch of over 150 new varieties using this technology, signals that Brazilian soybean cultivation is accelerating into a new era of genetic technology.