Biofertilizers Market Size, Share & COVID-19 Impact Analysis, By Type (Nitrogen Fixing, Phosphate Solubilizers, Others), By Microorganism (Rhizobium, Azotobacter, Azospirillum, Pseudomonas, Bacillus, VAM, Others), By Application (Seed Treatment, Soil Treatment, Others), By Crop Type (Cereals, Pulses & Oilseeds, Fruits & Vegetables, Others), and Regional Forecast, 2022-2029

The global biofertilizers market size was valued at USD 1.80 billion in 2021 and is projected to grow from USD 2.02 billion in 2022 to USD 4.47 billion by 2029, exhibiting a CAGR of 12.04% during the forecast period. The global COVID-19 pandemic has been unprecedented and staggering, with biofertilizers experiencing lower-than-anticipated demand across all regions compared to pre-pandemic levels. Based on our analysis, the global market exhibited a decline of 7.66% in 2020 as compared to 2019.

Surged demand for organic products leads to increased product adoption and demand for biological fertilizers. Higher recognition and acceptance of the product among farmers across developed as well as developing economies is positively influencing the market. The rising soil and water pollution due to excessive usage of chemical fertilizers is further fueling the adoption of organic and sustainable fertilizers. Moreover, the active participation of agricultural input producers in ramping up their production of agricultural biologicals, including biofertilizers is predicted to boost the market growth.

COVID-19 IMPACT

COVID-19 Outbreak Led to Raw Material Supply Chain Disruptions

The COVID-19 outbreak resulted in a slowdown of the global market due to various socio-economic changes that have emerged during this pandemic. Similar to the conventional fertilizers industry, manufacturers of biofertilizers and organic fertilizers across various economies face challenges due to the uneven raw materials supply. Price gouging by some logistics companies due to the hindered availability of transporters has emerged as a significant problem. The uncertainties associated with the situation resulted in a demand fall for bio-based fertilizers.

Additionally, some prominent companies operating in the market reported less revenue in 2020. For instance, the revenue of National Fertilizers Limited was USD 1.6 billion in 2020, which decreased by 13.97% (value in USD) versus last year, as the company's production and marketing have been affected due to labor and logistical constraints. They are expected to observe a steady recovery as demand for biofertilizers is not predictable to rise drastically even after the lockdown is lifted in developed and developing economies.

However, with major key players and the governments across several countries actively working toward restoring the supply chain, an improvement in the production, supply, and demand scenario of biological fertilizers is expected. The suppliers and distributors of agricultural biologicals need to consider technical advancement as a new opportunity. The coronavirus pandemic has forced companies to think about market penetration using novel characteristics of formulations and cost-saving.

LATEST TRENDS

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Proliferating Demand for Sustainable Crop Production Inputs to Support Market Growth

The market is projected to witness continuous growth in the forthcoming years due to the rising demand for fertilizers compatible with sustainable and organic farming and agriculture practices. These fertilizers are an economical and eco-friendly option for crop production; hence, their adoption is rising across the globe. Moreover, other aspects, such as improvement in soil fertility, increase in nutrient uptake by plants, and low risk to human health associated with bio-based fertilizers, are some of the key factors driving the global biofertilizers market growth.

DRIVING FACTORS

Increasing Emphasis on Organic Agriculture to Drive the Market Growth

Organic farming is one of the fastest-growing agricultural methods globally; according to the Research Institute of Organic Agriculture (FiBL), 72.3 million hectares of agricultural land were under organic agriculture management globally in 2019. The use of synthetic fertilizers led to contamination of soil and destroyed microorganisms. Organic farming is rapidly being adopted to reduce the increasing pollution of soil. Organic agriculture maximizes the effective use of local resources to improve soil fertility while avoiding agrochemicals, genetically modified organisms, and many synthetic compounds used as food additives. The ever-rising demand for organic food further motivates farmers to adopt compatible bio-based fertilizers to produce organic food.

Rising Governmental Support to Boost the Growth of the Market

The rising concern over declining soil quality due to overuse of chemical fertilizers and their potential ill-effects on human health has encouraged the governments across various economies to promote bio-fertilizers. Governments across several agri-dominant countries are opting for various plans, schemes, and other initiatives to encourage the adoption of bio-based fertilizers among farmers. Also, many governments have enacted comprehensive economic recovery plans that included new liquidity, tax flexibility, and agricultural and food industry subsidies, which are predicted to positively impact product growth. At the same time, many governments developed specific agricultural and food-related programs. For instance, in August 2021, Japan's Ministry of Agriculture, Forestry, and Fisheries (MAFF) released the Green Food System Strategy, which calls for the widespread use of bio-pesticides and biological fertilizers as part of technological advancements to reduce the use of agricultural chemicals and chemical fertilizers.

RESTRAINING FACTORS

High Production Cost of Biological Fertilizers to Restrict Market Growth

The production cost of biological and organic fertilizers is comparatively higher than conventional fertilizers as specific machinery and equipment are required for their production. This factor is projected to hinder the market growth during the foreseeable years. Moreover, biofertilizers include live microbial cells with a short shelf life (about six months at 20-25°C.), and their storage and shipping necessitate extra care and precaution, rising the product's cost. Thus, low shelf-life and low versatility are further predicted to restrain the market growth during the forecast period.

SEGMENTATION

By Type Analysis

Nitrogen Fixing to be Sought-after Owing to the Ability to Generate Higher Yield

Farmers have widely used nitrogen-fixing phosphate solubilizing biological fertilizers to produce high-demand crops such as wheat, rice, oilseeds, and others. Biological fertilizers containing nitrogen can correct the nitrogen level in the soil; hence, they aid in the growth of the crop. Nitrogen bio-fertilizers are broadly classified into free-living, symbiotic, and associative symbiotic.

Phosphate solubilizers are also witnessing significant growth. The demand for phosphate solubilizers is predicted to grow at a decent pace attributed to their potential to improve crop quality and yield. Phosphate is a key nutrient that plants need to function correctly, and it plays a vital role in all aspects of plant growth and development. The use of phosphate solubilizers effectively increases fertilizer uptake by mobilizing insoluble phosphorus into the soil to which they are applied. With biofertilizers' development, phosphate solubilizers have also become widely used among farmers.

By Microorganism Analysis

Rhizobium to be the Dominant Microorganism Owing to their High Efficacy in Crop Production

Rhizobium is the leading variant of microorganism used in agriculture due to its enormous importance in providing the major nitrogen source in the soil. Apart from being an excellent nitrogen-fixing agent, the rhizobium exerts plant growth-promoting traits and supports the insolubilization of inorganic phosphate. Further, its application is also rising mainly due to its ability to ensure success in achieving crop productivity and cutting the need for synthetic fertilizers that are expensive and harmful to the environment.

The utilization of azotobacter is projected to rise across agri-dominant economies as they are efficient in inducing beneficiary reaction on crop growth rate and improving seed germination. Azotobacter helps synthesize growth regulators such as auxins, cytokinins, and gibberellic acid (GA). In addition, it stimulates rhizospheric bacteria, protects plants from phytopathogens, improves nutrient uptake, and ultimately increases biological nitrogen fixation. The abundance of azotobacter in the soil is related to many factors, mainly soil pH and fertility; hence, their demand increases rapidly.

Pseudomonas is also widely applied in agriculture crop management as it imparts protection to plants against numerous fungal and nematode infestations. It also induces plant-growth-promoting hormones, which assist crop production.

By Application Analysis

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Seed Treatment to be the Most Adopted Application Method Due to its Various Agronomic Benefits

Seed treatment application held the highest share in the market with its wide utilization in administering biofertilizers. Crop and plant seeds are subjected to biofertilizer treatment to avoid viral or bacterial attacks, significantly reducing crop yield. Further, the biological fertilizers applied to the seeds promote atmospheric nitrogen fixation and make them readily available for the crop. Seed treatment also helps solubilize phosphorus in the soil and improve its availability. Along with this, numerous vendors have come up with innovative solutions to administer these biological fertilizers more efficiently, such as extended spreading widths and intelligent speed monitoring systems, which enhance spreading accuracy, slow-releasing fertilizer spreaders, and others.

Soil treatment is another major application of biofertilizers, which is expected to witness the fastest growth. It involves spraying the bio-based fertilizers on the agricultural land, thereby directly on the soil. The spraying of biological fertilizers on soil helps the symbiotic bacteria to interact with root nodules of the plants for nitrogen fixation and moisture retention in soil. This factor promotes healthy plant growth and prevents soil quality degradation and erosion.

By Crop Type Analysis

Cereals Segment to be Leading Owing to High Demand for Organic Cereals

At present, the application of organic fertilizers in the production of cereal grains is high compared to other crop types. The segment is anticipated to retain its dominant position throughout the forecast period. The high demand for organic cereals in both developed as well as developing economies due to the potential health benefits offered is boosting the market growth of organic cereals. In numerous experiments and field trials, the application of biological fertilizers on cereal crops has significantly increased their yields by nearly 60%-85%. Further, the demand for organic cereal and organic cereal-based products is surging among consumers across the globe, which augments the product use for cultivating cereal crops.

Biofertilizers in pulses & oilseeds are increasing, and rhizobium is widely used for nitrogen uptake and produces yields in pulses. The inoculation of biological fertilizers and sulfur had a major effect on oilseeds' yield and yield attributes. The increasing consumption and use of vegetable oils, owing to their wide application in cooking and other edible products, is boosting the oilseeds market, further aiding the product demand for oilseed production.

REGIONAL INSIGHTS

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In terms of geography, the market is categorized into North America, Asia Pacific, Europe, South America, and the Middle East & Africa.

The North America biofertilizers market stood at USD 564.29 million in 2021 and dominated this market. The market in North America is expanding considerably due to the growing number of organic farms in prominent economies such as the U.S., Canada, and Mexico. According to the United States Department of Agriculture (USDA) 2019 study, the U.S. organic certified farms were around 16,500 which grew by 17% between 2016 and 2019. The unprecedented COVID-19 pandemic and its huge impact on consumers' daily lives had significant consequences for the organic sector in 2020. As shoppers seek clean, healthy food at home, organic food products prove the food of choice. According to the Institute of Food Technologists (IFT), after increasing by more than 50% during the pandemic, sales of organic products in the U.S. jumped by more than 20% in the spring of 2020.

The Europe market is likely to exhibit significant growth, owing to the imposition of stringent regulations by the European Commission on the use of chemical fertilizers. The fertilizing products regulation agreement by the European Union opened the market for innovative organic fertilizers. The regulations provide strict rules on quality, safety, and labeling requirements for all fertilizers traded across the European Union. According to the European Union's new regulation for fertilizers, the limits for cadmium in phosphate fertilizers will be tightened from 60 mg/kg to 40 mg/kg after three years and to 20 mg/kg after 12 years, minimizing risks to health and the environment. The regulation increased the use of organic fertilizers and bio-based fertilizers, providing farmers and consumers with more diverse choices and promoting green innovation. 

In Asia Pacific, there is increasing R&D on biological fertilizers and various schemes launched by governments to promote organic farming, thereby boosting the market growth. According to the Press Information Bureau, Government of India, the Indian government has set a target of restoring 26 million hectares of degraded land, including saline soils, by 2030 to ensure food security for the population. The Government of India introduced schemes such as National Project on Organic Farming (NPOF) to produce, distribute, and promote biological fertilizers. China is promoting bio-fertilizers as an alternative to limit the overuse of chemicals in agriculture.

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South America is emerging as the fastest-growing market and is projected to offer strong growth opportunities to the market players during the projected period. The presence of Argentina and Brazil where the demand for organic products is increasing rapidly will foster the market growth in the region. According to the Research Institute of Organic Agriculture (FiBL), in 2019, Argentina was recognized as the second country with the highest potential share in global organic agricultural land (3.7 million hectares) after Australia.

KEY INDUSTRY PLAYERS

Enhancement of Product Portfolio by Acquisitions to Promote Market Growth

Market players operating in the market have realized the product’s growth potential. They are making continuous efforts to innovate, launch new products, and enhance their product portfolio in the market to establish their prominence. Market players are also focusing on collaboration, merger, and acquisition activities to aid their product portfolio and to address the requirements of a wider consumer base. For instance, in May 2021, Rizobacter Argentina S.A, a leader in agricultural microbiology, launched a new specialty fertilizer called Microstar BIO. This innovative product is a mix of biological and chemical fertilizers. It will help growers aim for profitable crops as well as lookout for soil.

LIST OF KEY COMPANIES PROFILED:

• Lallemand Inc. (Canada)


• Novozymes A/S (Denmark)


• National Fertilizers Limited (India)


• IPL Biologicals (INTERNATIONAL PANAACEA LIMITED) (India)


• Bioceres S.A. (Argentina)


• BioWorks Inc. (U.S.)


• SOM PHYTOPHARMA (INDIA) LIMITED (India)


• American Vanguard Corporation (U.S.)


• Gujarat State Fertilizers & Chemical Ltd. (India)


• Symborg (Spain)

KEY INDUSTRY DEVELOPMENTS:

• September 2021 - Novozymes launched five biological solutions, including inoculants to address key challenges for North American growers and establish a new sales team to serve customers directly in the U.S. The new products include inoculants that deal with nutritional efficiency issues, nodulation, and nitrogen fixation.


• June 2021 - Large-scale production of liquid biofertilizer, which improves soil health and increases agricultural yield, has begun at the State Government's Ettaiyapuram plant in India. The objective of developing this facility is to encourage farmers to utilize biological fertilizers as much as possible instead of chemical fertilizers.

REPORT COVERAGE 

An Infographic Representation of Biofertilizers Market

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The report provides qualitative and quantitative insights into the market. It also offers a detailed analysis of the global market share, size, and growth rate for all possible market segments, including type, microorganism, application, crop type, and region. Along with this, the global market report provides an elaborative analysis of the market dynamics and competitive landscape. Various key insights presented in the report are an overview of related markets, recent industry developments such as mergers & acquisitions, the regulatory scenario in critical countries, and key industry trends.

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