The Business of Biopesticides. Global Biopesticide* Market - Approx. 1 %. ($ 300
MM approx.) 160. 60. 40. 40. Microbial Pheromone Biochem Predatory.
Biopesticides, a global perspective Andy Cherry, Natural Resources Institute, University of Greenwich, UK
Ghana, 27 – 30 June 2005.
Agenda Definitions The world market Global trends and industry drivers The situation in Africa Research and development Current needs and future outlook
Biopesticides (= biologically based control agents)
Biopesticides (sensu stricto): Micro-organisms: fungi, bacteria, viruses, protozoa May also include: Entomopathogenic nematodes Parasites and predators Plant derived products Semio-chemicals – pheromones And maybe even: Secondary metabolites Genes, gene products …….
World agrochemical market 2005 East Asia 22%
Latin America 16%
West Europe 22% North America 30%
Rest of World 5%
$35 billion
East Europe 5%
Biopesticide market share Agrochemicals - $35 billion
BCA $300-600 million
World biopesticide market 2004 NAFTA 44%
Europe 20%
Asia 13% Oceania 11%
Latin America 9%
Africa 3%
The Business of Biopesticides Global Biopesticide* Market - Approx. 1 % 40
($ 300 MM approx.)
40
160 60
Microbial
Pheromone
Biochem
Predatory
* Excludes GMO plants Source: Agrow 2001
Credit: Prem Warrior, VBC
The Business of Biopesticides is ….. Unique – not a typical Agchem business Expensive - requires infrastructure Needs “uncommon” competencies & skills Requires continuous innovation in Technology, Marketing and Logistics Focus on “specialized” customer needs Often niche opportunities Credit: Prem Warrior, VBC
Key Biopesticide Industry Drivers Food safety and quality Regulatory requirements including MRLs
Organic Farming IPM / ICM Resistance management
Key Technology Drivers “Success stories” Newer genetic resources Biotechnology Tools Bioinformatics Production and Formulations Application Technology
Biopesticide Development Application Technology
Operational logistics
Microbiology
Manufacturing and Packaging Technology
Biopesticide Development
Fermentation Technology
Regulatory and Quality Control
Customer needs Focused Marketing
Formulation Technology
Credit: Prem Warrior, VBC
Ideal Biopesticide (commercial)? Efficacy Fast acting Consistency
Specificity vs. Spectrum of Activity Cost of Manufacturing – “Cheap” Shelf life – Minimum ONE year? Ease of Use Safety – Environmental, Non-target Benefits to grower Credit: Prem Warrior, VBC
Biopesticides in Africa: Two major markets: Export market
Domestic market
– Private sector
– Public (and private sector)
– High value crops
– Includes low value and subsistence crops
– Driven by market requirements Compliance with legislation Retailer codes of practice
– No effective legislation – No codes of practice
Export market BCA Cryptophlebia leucotreta granulovirus for control of false codling moth larvae in citrus in S. Africa Cydia pomonella pheromone for codling moth control in apple orchards S. Africa Plutella xylostella granulovirus against diamondback moth larvae in Kenya Entomopathogenic nematodes against thrips in Kenya
BCA developed in public research sector Beauveria & Metarhizium against: – Banana weevil - Cosmopolites sordidus – Locusts and grasshoppers – Larger grain borer - Prostephanus truncatus – Greater grain weevil - Sitophilus zeamais – Termites - Macrotermes & Odontotermes – Coffee berry borer- Hypothanemus hampei – Stem borers - Chilo, Sesamia – Cowpea weevil - Callosobruchus maculatus
Viruses Nucleopolyhedroviruses – Cotton bollworm - Helicoverpa armigera – Armyworm - Spodopter exempta
Granuloviruses – Potato tuber moth - Phthorimaea operculella – Diamondback moth- Plutella xylostella
Cypoviruses – Pink borer - Sesamia calamistis – Cowpea pod borer - Maruca testulalis – Rice stem borer - Maliarpha separatella
No shortage of biopesticide initiatives in Africa, and examples of the experimental use of microbial pathogens for insect control……
….but, in Africa, there appears to be a gap between R&D and implementation
Market size Low value Global biocontrol sales Africa has 3% share Less bt sales (80%), leaving Gross margin (40%) on sales
$600 m $18 m $3.6 m $1.4 m
Fragmented Diversity of crops and cropping systems Many countries
BCA production capacity BCA production is very low High risk venture with low returns on investment Industry characterised by SMEs that tend to be resource poor But in Africa capacity has arisen where there is demand S. Africa Kenya
Knowledge / awareness gap Lack of user / consumer awareness
Weak pressure on authorities, retailers and growers Lack of demand
Policy environment Food safety Legislation Retailer codes of practice IPM
Registration / regulation Exotic isolates Convention on biodiversity IPR
Food safety Legislation and retailer codes of practice are rare or poorly enforced IPM adopted by many govts. as national pest control strategy. – E.g. Tanzania, Spodoptera exempta
BCA registration Registration regulations – Chemical pesticide regulations unsuitable – Ecotox. and tox. data requirements expensive – GLP labs unavailable – Need for harmonisation Reduce bureaucratic burden for BCA producers e.g. CILSS
Lack of in depth knowledge of BCA – Training
Non-indigenous/exotoc BCA Import BCA to overcome lack of production capacity Non-indigenous/exotic organisms require quarantine facilities Meaning of “exotic”? What is the significance of genetic variation between isolates? E.g. Plutella xylostella granulovirus in Kenya
No functional or harmonised equivalent to phytosanitary legislation FAO guide to import and release of BCA
Exploitation of biodiversity Convention on biological diversity (CBD) – Fair and equitable benefit sharing Few countries have the institutional capacity to address biodiversity exploitation Govt need mechanisms to deal with rights under the CBD Some see it as a mechanism to generate income Profits unlikely to generate significant revenue
IPR Little IP protection of isolates Protection on processes, formulations Not a significant source of revenue Registration offers some limited protection – But South African companies producing copycat products
Role of research? Research should meet market requirements Address opportunities for new products Conducted in universities, govt. research institutes, industry (private companies and growers associations), and through partnerships. In Africa IARCs also play important role
Export sector Focussed research responding to market needs Profit driven Small companies source “know-how” from partnerships, consultants
Domestic sector Research in public (and private) sector Demand driven within donor priorities Poverty alleviation Improvement of livelihoods Environmental protection
Less market focus
Opportunities Export markets High value and niche markets IPM / ICM Resistance management Organic agriculture Public health Environmental protection
Conclusions for Africa Socially desirable but constrained by a number of factors Export sector products well driven and effective Domestic sector R&D and products appear to suffer from several constraints
Recommendations Capacity building and assistance – Consumer awareness – Enabling policy environment Harmonised regulations
– Closer public-private cooperation & support for SMEs – Alternative “not-for-profit” models for public sector BCA Eg Cuba / India
Recommendations – Environmental impact studies of non-native isolates – Intra-specific variation and the significance of “exotic” isolates – BCA risk assessment studies – Market research – Funding for generic registration data – Avoid supply driven research
Looking forward – a global perspective Continued regulatory pressures will drive the need for safer, cost-effective measures Newer chemistries & GMOs will continue to emerge Increased acceptance for biopesticides due to increased understanding of customer value equation Integration of cost-effective alternatives essential Need a paradigm shift in mindset (vs. Chemicals)
Biopesticides are here to stay and they work when used properly Credit: Prem Warrior, VBC
