Generic Manufacturers’ Sales Up, Market Share Down

hGeneric manufacturers’ sales within the U.S. crop protection chemical industry for all markets grew 6.7% during the 2012 year, according to Kline’s annual Generic Manufacturers Report. The report profiles and tracks the sales and market movements of 27 companies which make up 97% of the $2.47 billion U.S. generic crop protection market.

While generic manufacturers’ sales increased in 2012, their market share fell from 31.7% to 30.9% of the total market. Generic manufacturers maintained their value proposition during the year, but not without challenges. Demand for glyphosate rose substantially as planted acres increased and growers began using higher use rates for hard to control weeds. Generic companies sourcing glyphosate from China quickly ran out of supply as Chinese factories faced supplying a global market with an increase in demand along with more strict environmental regulations. This shortage of generic glyphosate encouraged a shift to branded products.

Major research-based manufacturers experienced an excellent year as they continue to combine crop protection products and seed trait package offerings to incentivize the distribution channel. The research-based companies continue to be very aggressive on pricing and rebates to gain share back from the generic companies. These companies have strategic plans in place to aggressively defend their off-patent product positions.

However, the leading generic suppliers  are bringing new products to the marketplace while the specialty generic companies, under $100 million in annual sales, continue to provide products containing straight active ingredients at a lower price. Grower awareness of corn rootworm resistance increased during the year, and the benefits of soil-based insecticides gained renewed recognition, benefiting generic companies with a market position.

Kline’s Generic Manufacturers Report covers the 2012 marketing year for generic manufacturers in the U.S. crop protection industry. The study provides reliable company and chemical product group sales information along with a strategic assessment of the entire market and the impact of trends shaping the industry.

— Written by Joe Prochaska

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