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China expected to miss industry consolidation target

The Chinese pesticide industry is unlikely to achieve its end-of-year goal of consolidating its agrochemical industry, analysts believe. China planned to cut the amount of pesticide companies by 30% during the period of its 12th five-year plan (2011-2015). The Chinese industry newswire, China Chemical Industry News, suggests that as this is the final year of the plan, hitting this target is “already practically impossible”. Over the past few years, China has encouraged companies to engage in mergers and acquisitions in a bid to reduce its number of pesticide operators, which was at over 1,800 in 2010. Industry insiders have suggested that the government should offer incentives to companies with outmoded production facilities to leave the market, the newswire adds. The five-year plan included the target of having five agrochemical companies achieving annual sales of over Yuan 5,000 million ($806 million at the current rate). With none of its agrochemical majors as yet reaching Yuan 4,000 million ($644 million) in 2014, this target also seems increasingly distant. 



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