Market Analysis – 70141607 – Locust control

Market Analysis Brief: Locust Control (UNSPSC 70141607)

1. Executive Summary

The global locust control market is a crisis-driven, services-intensive category estimated at $450M - $600M annually, with significant year-over-year volatility based on outbreak severity. The market is projected to grow at a CAGR of 6-8% over the next three years, fueled by climate change-induced increases in swarm frequency and scale. The primary threat is extreme supply/demand imbalance during major upsurges, leading to critical shortages of chemical agents and aerial application capacity. The single biggest opportunity lies in adopting satellite-based predictive analytics and drone application to improve response time and reduce costs.

2. Market Size & Growth

The global Total Addressable Market (TAM) for locust control services and products is highly volatile, fluctuating with the scale of infestations. The baseline market is estimated at $485 million for 2024, with a projected 5-year CAGR of 7.2%, driven by increasing outbreak frequency and a shift towards higher-cost, environmentally safer solutions. The largest geographic markets are concentrated in regions historically affected by Desert Locusts: 1. East Africa & The Sahel, 2. Southwest Asia (India, Pakistan), and 3. The Middle East (Yemen, Saudi Arabia).

3. Key Drivers & Constraints

1. Demand Driver (Climate Change): Increased frequency of extreme weather events (cyclones, heavy rainfall) creates ideal breeding conditions for locusts, leading to more frequent and larger-scale upsurges. This is the primary long-term demand driver. [Source - FAO, Ongoing]
2. Demand Driver (Food Security): With a growing global population, protecting staple crops from decimation by locusts is a critical priority for national governments and international bodies like the World Food Programme, ensuring consistent funding for control efforts.
3. Cost Constraint (Logistics & Geopolitics): Operations are concentrated in remote, often insecure regions (e.g., Sahel, Horn of Africa, Yemen). This dramatically increases operational costs and risks, including fuel, security, and transport, and can halt control efforts entirely.
4. Regulatory Constraint (Chemical Restrictions): Increasing environmental scrutiny and national-level bans on older, broad-spectrum organophosphate insecticides are forcing a shift to newer, more expensive chemical or biological alternatives, impacting cost and availability.
5. Technology Driver (Remote Sensing & AI): The adoption of satellite imagery, soil moisture data, and AI-powered predictive models is improving early warning systems, allowing for more proactive and targeted—and therefore more cost-effective—interventions.

4. Competitive Landscape

Barriers to entry are High, characterized by stringent regulatory approvals for pesticides, high capital investment for aerial fleets, and the need for established relationships with government and NGO stakeholders.

• Tier 1 Leaders (Primarily Chemical & Biopesticide Producers)

  • BASF: Global chemical leader providing key active ingredients like Fipronil, used in barrier treatments. Differentiator: Strong R&D pipeline and global distribution network.
  • Syngenta Group: Offers a broad portfolio of insecticides used in locust control, backed by extensive field research. Differentiator: Deep relationships with national agricultural ministries.
  • UPL Ltd.: Major post-patent insecticide manufacturer, offering cost-effective chemical solutions. Differentiator: Strong presence in key emerging markets, particularly India.
  • Lallemand/Danstar Ferment AG: Producer of 'Green Muscle®', the leading Metarhizium-based biopesticide. Differentiator: Market leader in proven, large-scale biological control solutions.

• Emerging/Niche Players

  • Kuzi AI: Provides AI-driven early warning systems using satellite data to predict locust breeding hotspots.
  • XAG: Manufacturer of agricultural drones increasingly used for surveillance and targeted spraying.
  • Local Aerial Service Providers: Region-specific charter companies (e.g., in Kenya, South Africa) providing aircraft and pilots for spraying campaigns.

5. Pricing Mechanics

Pricing is typically project-based or service-based, quoted per hectare treated. The price build-up is a composite of the control agent and the application service. A typical structure includes: Cost of Agent (chemical/bio) + Application Cost (aircraft/vehicle lease, fuel, pilot/driver) + Surveillance & Logistics + Labor + Overhead & Margin. Contracts are often awarded by national governments or NGOs (like the FAO) via competitive tenders.

The most volatile cost elements are tied to commodities and operational complexity. 1. Aviation Fuel (Jet A-1): Essential for aerial spraying. Recent volatility has seen prices fluctuate by +30-50% over 12-month periods. 2. Chemical Active Ingredients (AIs): Precursors are often derived from petroleum feedstocks and subject to global supply chain disruptions. Key insecticide precursor costs have seen spikes of est. +20-40%. 3. Regional Logistics & Security: In high-risk zones, costs for secure transport, storage, and personnel can surge by over 100% during active conflicts or periods of instability.

6. Recent Trends & Innovation

• Drone Application (2022-Present): A significant increase in the use of heavy-lift agricultural drones for both surveillance of hopper bands and ultra-low-volume (ULV) targeted spraying. This reduces costs, risks to pilots, and environmental impact compared to traditional fixed-wing aircraft.
• Biopesticide Mainstreaming (2021-Present): Following successful large-scale use during the 2020-2022 East Africa upsurge, Metarhizium-based biopesticides are now a standard component of integrated pest management strategies promoted by the FAO, moving from niche to mainstream. [Source - FAO Locust Watch, Jan 2023]
• Predictive Analytics Investment (2022-Present): National plant protection organizations and NGOs are increasingly investing in data platforms that integrate satellite imagery (vegetation, soil moisture) with weather data to predict breeding hotspots 2-3 months in advance, enabling preventative action.

7. Supplier Landscape

8. Regional Focus: North Carolina (USA)

Demand for locust-specific control services in North Carolina is effectively zero. The state is not a habitat for the swarming locust species (e.g., Desert, Migratory) that drive this market. While North Carolina has a significant agricultural sector that requires general pest control for grasshoppers and other insects, it does not face the large-scale, migratory threats that define the locust control category. Local capacity exists within general agricultural service providers and the research expertise at NC State University's Entomology Department, but there are no dedicated commercial locust control operators. Sourcing from this region for international needs is not viable.

9. Risk Outlook

10. Actionable Sourcing Recommendations

1. De-risk Supply & Address ESG. Pre-qualify and contract with at least one provider of Metarhizium-based biopesticides alongside traditional chemical suppliers. This creates supply chain resilience against chemical shortages and provides a publicly defensible, environmentally superior option for use in sensitive areas. Target a 15% volume allocation to biopesticides for the next major control campaign.

2. Pilot Tech for Cost Reduction. Fund a pilot program with an emerging drone surveillance and application provider in a key operational region. The objective is to quantify cost-per-hectare savings and response time improvements against traditional fixed-wing aircraft. Target a 25% reduction in surveillance-to-treatment time and a 15% lower all-in cost for targeted, small-scale infestations.