Organic fertilizers are derived from organic sources such as plant and animal waste and the raw materials can range from cow manure to organic compost. Kelp, guano, bone and blood meals, molasses, and fish emulsions are some of the organic materials used to develop organic fertilizers. Organic fertilizers promote healthy soil and are considered as a more environmentally friendly solution. Organic fertilizers enable loosen of soil, retain more moisture & nutrients and also promote healthy growth of micro-organism which ultimately encourages the healthy growth of plants. Organic fertilizers reduce the need for pesticides that contain chemicals that are useful as well as harmful to the soil.
The global organic fertilizer market is projected to reach around US$ 12.5 billion by the end of 2027, in terms of revenue, growing at CAGR of 7.2% during the forecast period (2019-2027).
Growth in the sale of organic food especially in the U.S. and Europe due to rising awareness regarding the health benefits of consuming organic food is expected to propel the market growth of organic fertilizer. According to the Organic Denmark, organic sales in Denmark have experienced the highest growth from 2017 to 2018. The organic food sale increased with 14 %. 11.5 percent of the Danes' grocery shopping is organic and this is the largest share compared to any other country in the world.
Rising concern over the environment as synthetic fertilizers have a negative impact on the environment such as impacting soil fertility and environmental degradation is driving the demand for organic fertilizers. Organic fertilizers improve soil fertility, conserves water by avoiding the flow of harmful pesticides into water bodies that leads to the growth of algae (eutrophication). This factor is propelling the market growth of organic fertilizers.
On basis of the region, Europe region dominated the global organic fertilizer market in 2018, accounting for 37.9% share in terms of volume, followed by Asia Pacific and North America respectively.
Figure 1. Global Organic Fertilizer Market, Revenue Share (%), By Region, 2018
The high price of organic fertilizers is another major factor expected to hinder the market growth of organic fertilizers. Few organic fertilizers also take a longer time to green up the lawn and also show some deficiency in plants during the initial months after the first application of fertilizers. Moreover, the level of nutrients in organic fertilizer is often unknown.
Organic fertilizers are very slow to break down into nutrients and some fertilizers smells very baldy and too offensive to use on indoor gardens which are restricting the adoption of organic fertilizers. Moreover, if organic fertilizers applied incorrectly it may also lead to surface and groundwater contamination, therefore organic fertilizers are needed to use incorrect manner. The aforementioned factors are hampering the market growth.
Rising adoption of organic farming among farmers subjected to the rising need for a sustainable environment is projected to provide numerous growth opportunities to the market of organic fertilizers. According to the Organic without Boundaries, in 2017, organic land area increased on all continents and a total of 69.8 million hectares of land were organically farmed. Therefore, the rising adoption of organic farming around the globe is expected to propel the market growth of organic fertilizers
Increasing government supporting through targeted subsidies, and growing investment in the research and development programs for developing novel organic fertilizers is projected to provide numerous growth opportunities. Moreover, the government is also providing capital investment to the producers in order to set up animal/plant waste-based organic fertilizers plant. This is projected to accelerate the market growth of organic fertilizers.
Figure 2. Global Organic Fertilizer Market– Opportunity Analysis
The rising trend of introducing new and advanced organic fertilizers by manufacturers is projected to augment market growth over the forecast period. For instance, in November 2019, The Totagars’ Cooperative Sale Society (TSS) Ltd at Sirsi in Uttara Kannada district has launched a new organic fertilizer product in the market. This fertilizer is suitable for arecanut, pepper and banana plantations. Hence, increasing penetration of such advanced organic fertilizers will propel the market growth.
Increasing investment by manufacturers to enhance the production capacity of organic fertilizers is projected to fuel the market growth of organic fertilizers. For instance, in September 2019, Chinese company Hameinivin Investment announced plans to invest $10 million in a large-scale organic fertilizer plant in Tboung Khmum province. Hence, rising investment by manufacturers is projected to propel the market growth of organic fertilizers.
Figure 3. Global Organic Fertilizer Market, Revenue Share (%), By Application, in 2018
On the basis of application, in 2018, the cereals and crops segment has accounted the largest market share of 74% in terms of value, followed by the fruits & vegetables and lawns & turfs.
Circular Economy: Regulation to boost the use of organic and waste-based fertilizers
The re-use of raw materials that are now disposed of as waste is one of the key principles of the Circular Economy Package adopted in December 2015. Today the Commission is proposing a Regulation, which will significantly ease the access of organic and waste-based fertilizers to the EU single market, bringing them on a level playing field with traditional, non-organic fertilizers. This will create new market opportunities for innovative companies while at the same time reducing waste, energy consumption, and environmental damage. The Regulation sets out common rules on converting bio-waste into raw materials that can be used to manufacture fertilizing products
Figure 4. Global Organic Fertilizer Market – Value Chain Analysis
Key players operating in global organic fertilizer market are Italpollina spa, ILSA S.p.A, Biostar Renewables, Plantin, Sustane Natural Fertilizer Inc., True Organic Products Inc., California Organic Fertilizers Inc., The Fertrell Company, Purely Organics LLC, Pupuk Kaltim, and Qingdao Sonef Chemical Co., Ltd
Few Recent Developments
Organic fertilizers are derived from human waste, animal waste, and vegetable waste. These fertilizers mostly available in liquids, powders, and solids. Moreover, organic fertilizers reduce the need for pesticides that contain chemicals that are useful as well as harmful to the soil.
The global organic fertilizer market has witnessed significant growth in recent past years, owing to favorable growth of organic agricultural practices all over the world coupled with regional government initiatives to promote organic farming is bolstering growth of global organic fertilizers market. According to Research Institute of Organic Agriculture (FiBL) report, in 2015, over 50.9 million hectares of land is occupied by organic agricultural activities. The regions with the largest areas of organic agricultural land are Oceania (22.8 million hectares, which is almost 45% of the world’s organic agricultural land) and Europe (12.7 million hectares, 25 %). The countries with the most organic agricultural land are Australia (22.7 million hectares), Argentina (3.1 million hectares), and the U.S (2 million hectares).
Based on the source, the global organic fertilizer market is bifurcated into plant origin and animal origin. Among these segments, an animal origin segment dominated the global organic fertilizer market in 2018, owing to the advantages using animal-based organic fertilizers such as presence of high amount of macro-nutrients and less degradation time over others organic fertilizers. This factor is estimated to fuel the growth of the global organic fertilizer market during the forecast period.
Moreover, based on application, the global organic fertilizer market is segmented into cereals and crops, fruits and vegetables, lawns and turfs. Among these segments, the cereals and crops segment is expected to propel the market growth of organic fertilizer in the coming years, owing to the growing production of cereals across the globe due to its nutrient value. For instance, according to Food and Agricultural Organization (FAO), in 2019, world cereal production was valued at 2,715 million tonnes, which is 2.3% higher than previous year. This demand, in turn, is estimated to drive the growth of the global organic fertilizer market during the forecast period.
Europe region dominated the global organic fertilizer market in 2018, due to increasing demand from organic farming in this region. For instance, according to European Commission, in 2016, the total area under organic farming was almost 12 million hectare and it accounted for 6.7% for total utilized agricultural area (UAA). As a result, this scenario is estimated to foster growth of the global organic fertilizer market during the forecast timeframe.
Key features of the study:
“*” marked represents similar segmentation in other categories in the respective section