Agricultural Growth In India
Agrochemical industries in India present immense growth opportunities. India is the 4th largest producer of agrochemicals globally and ranks 4th in terms of production of crop protection chemicals. The market in India is expected to reach US$ 7.5 billion (INR 532 billion) by FY19 and register exports of about 50% of the value of Indian crop protection industry (Source – India Brand Equity Foundation IBEF, February, 2018). Revenue growth of Indian Agrochemical companies was expected to increase by 12% to 14% between 2017-2019 (Source – Religare Institutional Research Report, January, 2017). In 2017, the market size for Indian seeds was approx. 3.6 billion dollars (INR 256 billion). Indian fertiliser market was INR 4675 billion in 2017. This data clearly indicates the growth in industry as well as in production in agriculture in India. This is certainly going to change the purchasing behaviour of rural India.
Advertising and promotional spends allocated by agri input companies towards rural promotion is approx. 2.5% to 3% of its revenue. Potential revenue of the rural advertising and promotion sector is estimated to be approx. INR 23.6 billion in 2020 (seeds and agrochemical industry).
Amongst the reasons cited for the current size of the rural market are high growth in technology and infrastructural development of the country, improvement in agri technologies and growth in yield of every crop and better market infrastructural development and godown and storage development.
One more reason is the development of big companies for procurement like Adani in apple procurement in Kashmir and Himachal and many private corporates in procurement of basmati rice in Punjab and Haryana.
Blog taken from Book " Rural Market Unleashed " available on Amazon.in