BEIJING, July 27 /PRNewswire-Asia/ -- Frbiz.com, one of China's leading B2B search platforms, reports that pesticide profits are weak.
The first half of the year in the pesticide business continues a decline that started during the financial crisis, and profits have generally continued to shrink.
First-half net profits at a pesticide company that disclosed it's financial information to Frbiz was estimated at between 8.8 and 22 million RMB. Compared with the same period of 2009, when it 44.12 million RMB, it has dropped 50% to 80%. Many other chemical enterprises' profits have also dropped.
In the first half of the year, frequent natural disasters in China were part of the major reasons leading to a decline in pesticide enterprise profits. There has been drought in southwest China, northern China has had a cold winter, there has been an extreme rainy season in eastern China, and the Yangtze River and South China have experienced floods and a series of extreme weather anomalies, resulting in market demand shrinking dramatically -- seriously affecting pesticide product sales.
In addition, bulk pesticide raw material prices rose year on year, while the sales price affected by the market demand pressures has been kept low, further exacerbating issues with pesticide enterprise profits. Glyph-sate herbicide, for example, has seen a marked change in global supply and demand, with selling prices remaining low for the first half year of the year. Imidacloprid insecticide and many other products' prices have also been falling so that some companies have experienced shrinking gross margins. Herbicide, insecticide and fungicide gross margins are currently down year on year, respectively 2.68%, 5.72% and 10.58%.
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