Agricultural Inoculants Market

The global agricultural inoculants market has witnessed significant growth over the last few years and is projected to register at a CAGR of 9.5% during the forecast period. The growth for the agricultural inoculants market is anticipated to be driven by increasing consumer preference towards organic products over the last few years. Also, the government authorities and various regulatory bodies in several countries are promoting the adoption of organic farming, leading to an increase in the sales of agricultural inoculants. On the other hand, the stringent regulations for organic farming are expected to restrict the growth of the global agricultural inoculants market during the forecast period. Rising adoption of organic farming practices in the emerging economies is anticipated to offer a lucrative opportunity to the manufacturers of agricultural inoculants in the near future.

The organic segment of the food industry is growing at a phenomenal rate. Rising health consciousness and consumer inclination toward healthy and nutritional food products are driving the demand for organic food across the globe. Consumers are also concerned about the impact of chemicals on the environment and health, leading to a shift to organically cultivated and processed products. The demand for organic food & beverage, personal care, nutraceutical, and pharmaceutical products is growing, paving the way for the adoption of organic farming. Food processors are highly inclined toward the adoption of natural and organic ingredients to meet the increasing demand for organic products. Moreover, the impressive projected growth of the organic and natural personal care products market from 2018 to 2023 is expected to boost the demand for organic ingredients. As per MRFR analysis, the global organic and natural personal care products market is projected to register a CAGR of 8.20% during the forecast period of 2018 to 2023. Furthermore, consumers of food supplements tend to be health-conscious and support a healthy lifestyle; they generally prefer organic food supplements. As per the Organic Trade Association, organic food accounted for more than 5% of total food sales in the US in 2017, an increase of 6.4% from the previous year. Consumers are willing to pay a premium for healthy food products, propelling the adoption of organic farming to meet the rising demand. Also, the growing issues of soil damage due to the usage of chemicals is alarming the farmers to move towards organic methods of agriculture. Organic agriculture assists in sustaining the health of soils, and ecosystems along with the health of people. There is a shift in focus towards organic farming and reduction of chemical residues in the environment.

Thus, the inclination of farmers toward organic farming to meet the rising consumer demand for organic products is driving the growth of the global agricultural inoculants market.

The increasing demand for organic products across the globe has led small-scale farmers in emerging economies to adopt organic farming practices. Growth is particularly high in emerging economies such as Brazil, India, China, and Argentina owing to rising awareness among farmers about the hazards of chemical fertilizers. There are significant investments being made in organic production in these countries to shift away from conventional farming practices. In Asia-Pacific, there was a large market for organic consumer goods in Japan and South Korea. However, in recent years, there have been significant developments in China and India. The focus of the agricultural sector in these countries is shifting from exports to domestic consumption. Government support for the promotion of organic farming also plays a significant role. In Thailand, the government launched a large-scale project in 2017 for farmers to receive financial support for buying organic seeds, reducing their dependence on agrochemical products, and building physical barriers to prevent contamination from neighboring farmlands. This scheme was launched to reduce the area of standard rice cultivation by 1m rai (160,000 ha) by 2022. According to FiBL, in Europe, the largest in-conversion areas in 2017 were in Romania, Poland, Hungary, and Bulgaria. Also, both Russia and Ukraine passed laws for organic claims in 2018 which will create significant opportunities for the suppliers of agricultural inoculants in these countries. Thus, a shift to organic farming practices in emerging economies offers lucrative growth opportunities to market players.

The organic label applies to food or other agricultural products that have been produced using approved methods. The regulatory bodies in different regions such as the US Department of Agriculture (USDA), European Commission, and Agricultural and Processed Food Products Export Development Authority (APEDA) have standards for products with organic claims which are designed to provide a clear structure for the production of organic goods. However, their stringency restricts the implementation of the practice. For instance, the production of organic crops on conventional farmland requires the land to be free of chemicals for five years. Moreover, the certification process in accordance with standards is complex. Significant paperwork is required to track each original organic ingredient through production and to the finished product. These factors are expected to restrain the growth of the market during the review period.

Despite having various potential, the agricultural inoculants market is highly concentrated into the developed economies across the globe. One of the major reasons for the low sales volume of agricultural inoculants is the high inclination towards agrochemical products, owing to the efficiency of the product. Also, there are various factors negatively impacting the acceptance of agricultural inoculants are lack of knowledge about agricultural inoculants among the farmers, non-availability of agricultural inoculants, and lack of guidance from expert personnel. The awareness is exceptionally low in the underdeveloped economies across the globe. So, the limited awareness among the farmers is anticipated to pose a major challenge in the growth of the global agricultural inoculants market during the forecast period. However, through the continuous campaign by the government and various manufacturers to increase awareness among the farmers, there can be changes in the adoption rate of agricultural inoculants over the coming years. Frequent demonstrations of usage methods of agricultural inoculants will help to overcome the challenge.