Agrochemical firms

Only 10 firms account for 75% of agrochemicals sales, while the 15 largest drug companies have a market share of only 33% (Stinson, 1995). About 85% of fine chemicals are manufactured by companies of the triad the United States (28%), Western Europe (39%), and Japan (17%). Italy, with 4.0 million litres reactor capacity and 71 manufacturers, topped the European fine chemicals industry (Layman, 1993). Recently India, China, and Eastern-Central European countries have gained a significant proportion of the market, as a result of the lower direct labour costs and the more relaxed environmental and safety standards. It is fair to state that the high quality of chemists in these countries has also contributed to this development. In 1993, the cost of producing fine chemicals in India was 12% below that in Europe (Layman, 1993). 

Therefore, most chemical companies that are not yet active in biotechnology should act today, as the first movers have already started to reduce competitors options. Areas where firms need to move quickly and aggressively are textile chemicals, fine chemicals, and additives. In contrast with agrochemicals, with its slow consumer acceptance, non-movers are not likely to get a second chance. 

However, small startup firms have cornered the markets here, while established companies are strugghng to maintain their innovative edge, and the same applies to the chemical industry. Innovations in e-commerce and in biotechnology have started to change the game completely in some chemical businesses, such as agrochemicals, but most of these originate with startups, and not with the big estab-hshed chemical companies. 

The agricultural chemical industry is an oligopoly - 80% of worldwide agrochemical sales are accounted for by 12 firms (see Nadai, 1995). This fact suggests that imperfect competition (where manufacturers do not treat price and/or the behaviour of competitors as exogenous) will be an important factor in determining the accumulation characteristics of these products. This section analyses the effect of market structure on manufacturers choice of product accumulation characteristics. The analysis will, unfortunately, be more technical than that of the previous section, a fact made... 

Agrochemical companies are expected to provide customers with new products that are safer and more eco-friendly. They must have a clear vision and firm business strategies for strong and stable corporate management in order to meet these expectations. 

---