The torrid North American agrichemicals market, which has already dented profits at the likes of Monsanto and Syngenta, added Germany's BASF and Bayer to its victims, with both reporting falls in crop protection profits.

BASF blamed large inventories for a fall in North American agrichemicals sales in the April-to-June quarter, defying higher sales in the rest of the crop protection division.

"Demand for our fungicides weakened because distributors were holding largely inventories. Prices declined," the world's biggest chemical group said.

The comments were echoed by Bayer, which cited "targeted inventory clearances" as one reason behind a fall to E355 in North American agrichemicals sales - a slump of 30% on a constant currency basis.

'Intensified generic competition'

Bayer also flagged the "difficult market and competitive situation" in the US, besides the "pressure" exerted by makers of generic agrichemicals, rivalry which Monsanto and Syngenta have blamed for sharp falls in sales of broad-based glyphosate weedkillers.

Furthermore, "intensified generic competition and low insect infestation pressure led to a marked decline in sales in our insecticides business", Bayer added.

With Bayer's overall sales from sprays and seeds falling by 5.5%, at constant currency levels, to E1.88bn in the quarter, the group said its CropScience division was no long on track to grow full-year takings by 2-3%.

"Provided market conditions return to normal in the second half of the year, we anticipate that sales in 2010 overall will be slightly lower than the prior-year level," the group said.

Earnings before interest, tax, depreciation and amortisation (ebitda), which tumbled more than 20% in the quarter, would "decline significantly", rather than matching last year's result, as previously hoped.

Market reaction

With Bayer's overall performance also lagging market expectations, its shares closed 0.1% lower at E44.135 in Frankfurt.

BASF stock lost more, ending 2.1% lower at E44.38, even though its group results were perceived by analysts as ahead of expectations, thanks to strong rebounds in the group's core chemical and plastic activities.