Adama released its financial results for the fourth quarter and full year ended December 31, 2022. The company reported record sales and EBITDA for the year, with growth in volume and prices largely intended to offset increases in costs.
Adama's CEO, Ignacio Dominguez (in the photo above), celebrated the results and highlighted the importance of innovations and product launches in the Brazilian market, one of the main factors responsible for the company's growth.
"In 2022, Adama introduced many differentiated products to the market, optimizing its offering for farmers around the world while maintaining simplicity in business and intends to continue to do so in 2023," said Dominguez.
The Brazilian market played a crucial role in Adama's performance in 2022, with the company achieving significant growth in sales in the country, driven by prices, volume and the launch of new innovative products in formulation, such as the fungicide Armero and the herbicide Araddo. Despite the slowdown in sales in Brazil in the fourth quarter, due to anticipated business in the third quarter, the company's sales grew at constant exchange rates in most regions.
Adama continued to register and launch several new products in markets around the world, adding to its portfolio of differentiated products. In Brazil, the company launched Protege, a biological nematicide and fungicide based on microorganisms (with a triple combination of microbes) for sugarcane and soybeans, which also increases productivity. Additionally, it launched Emerge, a biostimulant based on enriched fermented seaweed extract, which promotes root and vegetative growth and the absorption of nutrients in the establishment phase, targeted at soybeans, cotton and corn.
Adama's financial highlights include fourth quarter sales of $1,312 billion, reflecting a 6% increase in prices and a 6% decrease in volumes. For the full year 2022, sales reached a record $5,570 billion, a 16% increase, driven by a 16% price increase and 4% volume growth. The increase in sales for the full year period reflected strong market demand for crop protection products, led by sales in Brazil and China.
In Latin America, Adama achieved very significant growth in sales in Brazil during the entire year, driven by the factors mentioned above. Additionally, in other Latin American countries, the company achieved higher sales for the full year period despite adverse weather conditions.
Agricultural prices reached record levels in May 2022, driven by tight inventories, adverse weather conditions and the Ukraine-Russia conflict that disrupted commodity supplies. Since then, prices have fallen but are expected to remain above pre-pandemic levels.
High crop prices have generated strong farmer income despite the higher cost environment (fertilizers, chemicals, labor, energy) faced by farmers. As a result, demand for crop protection products remained strong in 2022 and farmers were able to absorb crop protection price increases. In 2023, crop protection channel stocks in some regions are above average, which may decrease demand in the near future.
The cost environment improved throughout the second half of 2022 as raw material and active ingredient prices in China continued to fall, logistics prices normalized and energy prices declined. However, costs are still higher than pre-pandemic levels, with some areas still experiencing especially high costs.
The company reports that it has been granted a patent for Sesgama, a proprietary formulation technology platform for high-load formulations and other challenging formulations, enabling less use of co-formulants, shipping and packaging materials per treated acre with a sustainability profile of resulting improved product. The first products should be launched next year.
During 2022, Adama registered and launched several new products in markets around the world, increasing its portfolio of differentiated products. Differentiated products may also be based on recently off-patent active ingredients (AIs) that have been classified as having high commercial potential - AI "Core Leap" and include a variety of product features such as (i) unique proprietary formulations, (ii) products with more than one mode of action and (iii) biological.
Among them were:
• launch of 18 differentiated products during 2022 in selected countries, including the following products during the fourth quarter of 2022;
• launch in Brazil of Protege, a microbial-based biological nematicide and fungicide (based on a triple combination of microbes) for sugarcane and soybeans that also increases productivity;
• launch in Brazil of Emerge, a biostimulant based on enriched Fermented Seaweed Extract, promoting root/vegetative growth and nutrient absorption in the establishment phase, targeted at soybeans, cotton and corn;
• launch of Adama's sustainable offering of organic products in several Central American countries, including Expert Grow;
• launch in Ecuador of Custodia Active, a broad-spectrum, dual-action systemic fungicide for use on Rice and Corn that also increases productivity;
• label extension for Folpan 500 SC in Germany, a multi-site contact mode of action fungicide, for use on barley against leaf spot diseases;
• launch in Panama and El Salvador of Trivor, a double-action insecticide for use on vegetables;
• launch in several Central American countries of Banjo Forte 400 SC, a dual-mode foliar fungicide for use on fruits, vegetables and specialty crops;
• launch in Russia of Cormoran, a dual-mode insecticide that includes Adama's proprietary AI Novaluron;
• pre-launch in Paraguay of Araddo, a dual-mode herbicide and Plethora, a broad-spectrum, dual-mode insecticide that includes AI Novaluron and Indoxacarb owned by Adama;
• launch in France of Helanov, a unique herbicide for use on Beetroot;
• registration of 10 new differentiated products during 2022 in selected countries, including the following products during the fourth quarter of 2022;
• registration in India for the AI insecticide “Core Leap”, Chlorantraniliprole (CTPR).
• US registration of Fullscript, a dual-mode herbicide for rice, part of the FullPage rice growing solution, in collaboration with Rice Tech;
• registration in Paraguay of Apresa, a dual-mode pre-emergent herbicide, fed by T.O.V. Formulation Technology.
Receive the latest agriculture news by email
