HERBICIDE USE INCREASING ON RANGELAND, PASTURES TO COMBAT INVASIVE SPECIES

LITTLE FALLS, NJ, June 17, 2004 – While major crops such as corn and soybeans receive regular herbicide treatment on nearly 100% of planted acres, weed control has not been widely practiced on America’s rangelands and pasturelands. But the steady encroachment of invasive weed and brush species has finally necessitated action, and it has created an important growth market for suppliers of chemical herbicide products, according to a report soon to be published by Kline & Company.

Kline’s new study, THE U.S. INDUSTRIAL VEGETATION MANAGEMENT MARKET FOR PESTICIDES AND FERTILIZERS 2004, estimates that the market for chemical herbicides used on rangeland and grazing pastures expanded by more than 30% from 2001 to 2003. While the study identifies a number of factors contributing to this tremendous increase, most are directly related to a greater awareness of the invasive weed and brush problem that has been worsening for several years.

“Both federal and private landowners have seen this problem coming for some time but never really addressed it because herbicide use on rangeland and pastures didn’t seem cost-effective,” says Dennis Fugate, manager of Kline’s Agribusiness Practice. “Now some areas in the West have a serious problem. Overgrazing and extended drought have created conditions that favor some invasive species, and it could take a lot of time, effort, and expense to reclaim these areas for grazing.”

Cornell University’s Department of Ecology and Evolutionary Biology has estimated that invasive plants like leafy spurge and salt cedar cost the U.S. economy an estimated $33 billion a year. And according to the USDA Agricultural Research Service, infestations of invasive and noxious plant species on U.S. rangeland and pastures are expected to increase at the rate of 20 million acres per year, reaching about 140 million acres by 2010.

To combat this incursion, federal and state organizations are introducing programs that feature chemical control as a key element. Executive Order 13112, “Invasive Species,” was introduced in 1999 and mandates programs to prevent further introduction of invasives. The U.S. Forest Service also introduced a major initiative in March 2004 to prevent the further spread of new invasive weeds and to contain existing populations.

With federal programs like these, as well as some state and local funding for private landowners, demand continues to rise for selective herbicides that could be applied to grazing and hay production areas. And herbicide producers are now hearing the call.

In recent years, products like BASF’s Plateau, Dow AgroSciences’ Grazon P+D, and DuPont’s Cimmaron have been introduced. And new value-added combinations that provide control of a broader spectrum of weeds and brush species are gaining market share.

Many herbicide producers avoided spending R&D dollars in the rangeland and pasture segment in the past because of its highly fragmented nature and its lower value in relation to major field crops, says Fugate. But increasing demand in this sector has presented these companies with a new sales outlet to help offset recent declines in sales of conventional selective herbicides for crops like corn, cotton, and soybeans.

Capitalizing on opportunities in the rangeland and pasture market isn’t without its challenges, Fugate warns. The market is still fragmented, with a wide diversity of terrain, climate, and targeted species across the continental United States.

“The needs of a hay producer in the Northwest exporting weed-free hay to Asia are going to be very different than the needs of a big cattle rancher in Kansas or Texas,” says Fugate. “Companies that are going to be selling herbicides to these kinds of outfits will need to develop versatile, cost-effective products and dedicate specialized staff to market them.”

THE U.S. INDUSTRIAL VEGETATION MANAGEMENT MARKET FOR PESTICIDES AND FERTILIZERS 2004, Kline’s fifteenth edition of this report, will provide a comprehensive examination of pesticide and fertilizer use for the 2003 calendar year in the forestry, electric utilities, roadways, railroads, rangeland and pastures, aquatic areas, and mosquito abatement segments.

For more information on this study, go to www.klinegroup.com/Y518d.htm or contact at 410-418-8934.

Established in 1959, Kline & Company is an international business consulting and market research firm serving clients worldwide in the agribusiness, biotechnology, and life sciences sectors.