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Seeds -- a US$ 30 billion global industry

12 top markets constitute 66% of  India (US$ 1 billion) & China (US$ 2.5 bn.)
theGlobal seed industry
are in the top 10 markets

 India has over one sixth of the global


population

 high importance to food self-


sufficiency
India US$ 1 bn market
 India needs to increase productivity
significantly

0 1,000 2,000 3,000 4,000 5,000 6,000  12% of global arable land

Canada UK Italy India  4% share of global crops


Argentina Germany Brazil France
CIS Japan China USA

Figures in US$ mn
India seeds market

 With a size of US$ 1 bn, India is the


1,200
eighth largest commercial seed Land area
1,000
market in the world Arable area
800
 Arable land is around 136 mn ha

Mn ha
600
which is higher than China
400
 High growth expected on the back of
200
transition from traditional varieties to
high value varieties and hybrids 0
India Brazil USA China
 Public sector – varietal crops like
paddy, wheat, pulses – 80% of seed
volume; 40% of total value
Increase in India’s share in world crops
 ~ 150 companies in Private sector –
can come from improved productivity as
majority operates as traders
growers shift to hybrids.
Seed market structure

Saved seeds account for nearly 85% of the market Private sector dominates with a 60% market share

Commercial
Seeds 15%

Saved Seeds
85%

Note: Research hybrids are 30% of commercial


seed market by value
 Rising food demand and limited
agricultural land
Domestic seeds market is expected to double
over the next five years implying a CAGR of  Shift to commercial seeds which have
Driven
13%. Hybrid seeds will grow much faster
by better technology
given expected conversions from traditional
varieties.  Growth in fresh produce market and in
processed food sector
Industry Structure – The Situation Today

Seed Industry

Public Sector Private Sector

NSC SFCI SSCs - IPS – MNC


13 200 – 10

 Public sector – in self-pollinated crops of which wheat & rice account for 60%
 Private sector mainly in hybrids that are low in volume but high in return
 Opportunity lies in converting users of farm-saved seeds and public hybrids
 In terms of volume, paddy and wheat offer largest opportunity
Key Indian Seed Players
Company Holding Turnover Focus
Structure (INR mio.)
Mahyco Monsanto (26%) 1200 all crops
Emergent (after HLL & Mahendra) 1200 all crops
Monsanto Monsanto 1000 sunflower, corn, cotton
Proagro Bayer Crop Science 800 all crops
Namdhari family 800 vegetables
Nuziveedu family 800 cotton, millet, corn
Ganga Kaveri family 600 sunflower
Advanta India Advanta(Fox Paine)& Agrotech Foods (50% each) 500 sunflower, rapeseed, corn, millets, paddy
Syngenta Syngenta 500 sunflower, corn, cotton, millets
Pioneer Dupont 450 sunflower, corn, millets
JK JK Group 400 cotton, millet, corn
Ankur family 400 vegetables, cotton
Seminis Fox Paine 300 vegetables
Indo-American family 300 vegetables, flowers
EID Parry family; Monsanto (51%) 100 sunflower, cotton, paddy
Nath family 100 cotton, millet, corn

Total 10000
Market Share of Key Indian Players
EID Parry
Indo-American 1% Nath Mahyco
3% 1% Mahyco
Seminis Emergent
14%
3% Monsanto
Ankur
Proagro
4%
JK Namdhari
Emergent
4% Nuziveedu
Pioneer 14%
Ganga Kaveri
5%
Advanta India
Syngenta
Syngenta
5% Pioneer
JK

Advanta India Ankur


Monsanto
5% 11% Seminis
Indo-American
Ganga Kaveri EID Parry
6%
Proagro Nath
Nuziveedu 8%
8% Namdhari
8%
Attractive research hybrid seed segments

Marketshare by value of Key Key Hybrid Crops: Sales


Hybrid Crops
70,000 140
Production (MT)
60,000 Value (US $ Mn.)
120

50,000 100

40,000 80
(

30,000 60

20,000 40

10,000 20

0 0
C otton Maize Sorghum Bajra Sunflower

Cotton is the most important segment because of a high percentage of


cultivated area under research hybrids.
Background – The Role of Regulation
 Seed Act, 1966 – min. quality standards, certification &
procedures for evaluating varieties
 Public sector dominated the industry until 1971
 1971 – National Commission on Agriculture recommended
breaking of public sector stranglehold – Indian private sector
enter the sector
 1988 – New Seed Policy – entry of MNCs; import of seeds and
germplasm allowed for research
 Seed Policy is still very restrictive and detrimental to farmers
 2002 – Comprehensive Seed Policy – to overhaul existing Seed
Act – should usher new growth in the liberalised era
Public & Private Sector Activity

 Public sector – in self-pollinated crops of which wheat & rice


account for 60%
 Private sector mainly in hybrids that are low in volume but high
in return
 Opportunity lies in converting users of farm-saved seeds and
public hybrids
 In terms of volume, paddy and wheat offer largest opportunity
Indian Agriculture – Challenges Ahead

 Agriculture growth must keep pace with growing demand; food


grain demand growing at 3.4-5.5%p.a.
 Efficiency to improve in use or resources –decline in land & water
resource base for average farm holding
 Fertiliser must be used wisely and there should be adequate
storage infrastructure
 Agriculture tech management must become efficient to take
advantage of expanding production & marketing opportunities
 Tariff and non tariff barriers imposed by developed countries
 Thrust to high yielding & efficient inputs like seeds
Types of Seed Produced in India
 Cereals, Oilseeds, Cotton, Vegetable
 Cereals dominate the seed market hybrids in Corn, Sorghum,
Pearl millet, SSG
 Major opportunities in Wheat and Rice
 Sunflower dominate in oilseeds with opportunities in Brassica
(‘00’ and transgenic)
 2:1 ratio of private to public hybrids in Cotton;
 Tomato (28%), Cabbage(23%), Brinjal (14%) – major share of
hybrids
 3.12 mn ha under vegetables; Current mkt. value for hybrids INR
200Cr, varietal INR 50Cr

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