The revival identified in former Soviet Union purchases of fertilizer
has spread to other crop inputs too, to judge by results from Syngenta, which flags
an "excellent performance" in the region in both agrichemicals and seeds.
Syngenta, the world's top farm sprays group, flagged the
role of Ukrainian operations in fuelling a 16% surge to $572m in the group's sales
in its Europe, Middle East and Africa (EMEA) region in the October-to-December.
"Ukraine made a major contribution," Swiss-based Syngenta
said, noting an "early start" to the pick-up in sales ahead of the key spring period
for sowings and agrichemicals applications.
The performance came at the end of a year in which the former
Soviet Union region achieved an "excellent performance" and proved the "main
growth driver" for 2016 EMEA sales which, at $3.79bn, rose by 5% in constant
currency rates, although falling 2% in dollar terms.
Syngenta flagged "an expansion of strong market positions in
both crop protection and seeds" in the former Soviet Union last year.
The comments follow evidence too of reviving fertilizer
sales in the region, with Russian farm ministry data showing an 11.1% rise in
purchases last year, in active ingredient terms, while industry data put overall volume growth at 16%.
PhosAgro, one of Russia's biggest fertilizer groups, last
week reported "impressive" growth of 30%, to nearly 2.1m tonnes, in its domestic
sales last year, terming the Russian market "one of the fastest-growing
Rival Acron on Monday reported a 20% rise to more than
900,000 tonnes in Russian fertilizer last year, saying that the "agroindustrial
complex significantly increased purchases of mineral fertilisers".
The group flagged the role of "state support" in boosting purchases,
with official data showing a 32% surge to 331bn roubles in credits given to
producers last year for "seasonal field works" such as planting and harvesting.
A US report published last week, flagged the role also of "strong"
domestic grain prices in boosting farmers' incomes.
Syngenta said that products supported particularly by takings
in the former Soviet Union buying included sunflower seeds, of which sales "grew
strongly" last year, and of Callisto, a herbicide for use against weeds in corn
Indeed, the growing demand Callisto reflected the increasing
popularity of corn among the region's farmers, with Russian area, on a harvested
basis, hitting a record 2.80m hectares last year, according to US Department of
Combined Russian and Ukraine corn area, at 7.05m hectares,
has more than tripled so far this century.
The performance helped limit to 5% the drop to $12.79bn in group
sales last year, a decline reflecting dollar strength besides the non-repeat of
a $200m boost in 2015 from a royalty deal on genetically modified corn with KWS/Limagrain.
'Confident of closure'
The results come as Syngenta is amid a $43bn takeover by
China's ChemChina, although the closure of the deal is being held up by
antitrust reviews, which in the European Union will last until at least April.
"ChemChina and Syngenta remain fully committed to the deal
and are confident of its closure," Wednesday's results statement said.
While Syngenta shares rose 1.1% to close at SFr430.00 on Wednesday, equivalent to
$432.70, they remain well below ChemChina's offer price of $465 per share plus
a special dividend of SFr5, implying some investor doubts over the transaction.