I. Abstract

In Taiwan, there are about 36 publicly owned makers and sellers of biofertilizer. These products are used to supply the domestic market and represents roughly 90% of the total volume used in Taiwan. As there are still no laws in place regulating biofertilizer, the use of biofertilizer by farmers in high economic crop areas is understood to be quite popular and has received positive assessment toward the volume and quality of the crops. Since biofertilizer not only helps reduce the use of chemical fertilizer, but also contributes toward the preservation of the environment habitat as well as reduces degradation of the soil. Therefore, there is a need to develop Taiwan’s domestic biofertilizer industry.

The current state of the biofertilizer industry is to focus on the research and development of new products, using pathogenic fungi from domestic microorganisms for screening and thus achieve the main R&D direction of multi-functionality and high quality. The government should also announce related rules and regulations in order to manage and register biofertilizer products. In addition, the division of work system between industry and academia should be enforced while technology transfer between industry and academia should be fully implemented in order to enhance Taiwan’s biofertilizer production techniques and quality, at the same time strengthen the education of Taiwan’s farmers as well as the development of overseas markets.

II. Industry Definition and Scope

Biofertilizer refers to products using live organisms as expanded definition of fertilizer. Today’s main biofertilizer product is specified additives that includes live organisms or dormant spores, e.g. bacteria (including actinomyces), fungi, and algal. When applied onto crops, it has the effect of supplying specific nutrition to plants, so it is also known as microbial fertilizer. These effects include enhancing the supply volume and total volume of plants’ nutritional elements, stimulate plant growth, or stimulate plants’ absorption of nutritional elements.

III. Industry Overview

(1) Industry structure

Among the materials used in agriculture, fertilizer is the most widely used. Based on fertilizer’s production process, it can be roughly categorized into three types, chemical fertilizer, biofertilizer, and organic fertilizer. Each type of fertilizer has its advantages and disadvantages. These advantages need to be integrated in order to get the most out of each type of fertilizer, and achieve the balanced development of the industry.

The effect of chemical fertilizers is usually direct and fast. In terms of price, it is more competitive than biofertilizer and organic fertilizer, which makes it more accepted and applied by users. However, due to the convenience of using chemical fertilizer, it is often over applied for each unit area. This causes plants to lose their resistance, soil acidification, high concentration of nitrate in agricultural products, etc.

Biofertilizer refers to products using live organisms such as microorganisms or dormant spores to be made into additives’s fertilizer. It is also known as microbial fertilizer. Biofertilizer increases the soil’s fertility, helps plants absorb, and enhances plants’ resistance towards disease, cold, and dry weather. The biofertilizer industry is still a new and upcoming industry. Products come from both local and overseas sources, and produced in the form of either liquid or solid fermentation. There are currently 36 local importers and manufacturers that can be found on the worldwide web today. Most of these manufacturers are small size enterprises that lack the talent and capital for R&D.

In Taiwan, biofertilizer is accepted by only a few farmers growing high economic value crops, such as wax-apple, grafted pear, and grapes. With the low usage rate, there is still a lot of room for developing Taiwan’s biofertilizer. However, although biofertilizer has many advantages, yet its usage environment, strict storage conditions, and the difficulty of using it with pesticides should be overcome as soon as possible.

Domestic manufacturers, importers and sellers of biofertilizer is as follows:

Current status of Taiwan’s biofertilizer companies (inquired from the Internet)

Company Name Paid In Capital Product Description
Taiyen Biotech Co., Ltd. 50 billion Develop & produce microorganism fertilizer
Chia Hsin Food and Synthetic Fiber Co. 12.842 billion Develop & produce microorganism fertilizer
Yuen Foong Yu Bio-Tech
Co., LTD.
12.5904 billion R&D microorganism application on biofertilizer
Taiwan Fertilizer Co., Ltd. 9.8 billion R&D microorganism fertilizer
King Car Biotechnology Industrial Co., Ltd. 4.0 billion R&D microorganism fertilizer
Sinon Corporation
3.572 billion R&D microorganism fertilizer
Kaohsiung Ammonium Sulfate Corp. 3.3 billion Develop & produce microorganism fertilizer
Fwusow Industry Co., Ltd. 2.45 billion Develop & produce microorganism fertilizer
Bion Tech Inc. 300 million
R&D microorganism fertilizer
Syngen Biotech Co., Ltd. 300 million R&D microorganism fertilizer
Chang Sheng Biotechnology Corp. 250.0 million Develop & produce microorganism fertilizer

Grand Peak Biotec Industries Co., Ltd.
170.0 million Microorganism fertilizer
Gene Agri Aqua Ecosystem Biotec Co., Ltd. 120.0 million Biofertilizer
Bigau-Chahng Biotechnologies Co., Ltd. 29 million Microorganism fertilizer
Taiwan Sureline Bio-Tech. Co., Ltd. 25 million Biofertilizer
Fermentech Co., Ltd. 20 million Microorganism fertilizer
Fermentech Co., Ltd. 20 million R&D microorganism fertilizer
Challenge Bioproducts Co., Ltd. 18.5 million R&D microorganism fertilizer
Safe Protecta Technology Co., Ltd. 1.33 million Biofertilizer
A-Tech Bioscientific Co., Ltd. 5.0 million R&D and production of microorganism fertilizer
Advanced Green Biotechnology Inc.   Develop & produce microorganism fertilizer
Vast Industrial Co., Ltd.   Microorganism fertilizer
Toyomoto Biotech Co., Ltd.   Microorganism fertilizer
Chao Yang Biotech Agriculture Co., Ltd.   Microorganism fertilizer
Come-True Biotechnology Corp.   organic biology fertilizer manufacture
Sunway Agricultural Development Group.   Microorganism fertilizer
New Taiwan Greenhouse Service Net Station   Microorganism fertilizer
Grand Favour Enterprise
  microorganism additives land improvement
Green Source Biotech Corp.   Microorganism fertilizer
Goldentake Enterprise Co., Ltd.   Biotech fertilizer
Jinnung BIOTECH CO., LTD.   Microorganism organic fertilizer
Hei Chin Chemical Company   Microorganism organic fertilizer
Bouso Organic Fertilizer Co.,Ltd   Microorganism organic fertilizer
Rico's Best Development Co., Ltd.   Import biofertilizer
King Ling Corporation   Microorganism fertilizer
Acro Chemical Corp.   R&D microorganism fertilizer
Grand Sight Enterprise Co., Ltd.   Biotech fertilizer products


(2) Sales and marketing channels

The material for biofertilizer among domestic sales and marketing channels are similar to other fertilizer and pesticides, with manufacturers directly selling to the farming villages’ retail stores, farmers’ associations or farmer production and marketing group. However, the performance of biofertilizer is affected by the type of crop and soil type it is applied to. Therefore, the sales of biofertilizer are even more regional and linked with the usage habits of the farmers.

IV. Market/Product Analysis

(1) Global market

According to statistics, the worldwide transaction amount of fertilizer is roughly US$40 billion. Of this, 135 million metric tons of chemical fertilizer is applied each year, with sales volume of about US$30 billion. Although there are no clear application statistics for biofertilizer, however, its sales volume is estimated to be as much as US$3 billion.

(2) Domestic market

As for the sales of fertilizer in the domestic market, around 1.1 million metric tons of chemical fertilizer is applied each year, with sales reaching NT$6.3 billion. About 4.14 million metric tons of organic fertilizer is applied yearly, with salves of NT$4.1 billion. Although there are no accurate application numbers for biofertilizer, but based on the NT$150 million in sales by the 20 biofertilizer importers or manufacturers during 2000, it is estimated that in 2002, sales volume can increase to over NT$200 million. Production of biofertilizer in Taiwan is mostly through fluid and solid fermentation while most of the products is used to supply Taiwan’s high economic value crops such as wax-apple, grafted pear, grapes, etc. Moreover, since the application of biofertilizer doesn’t have negative affects on the environment and can replace some of the chemical fertilizers as well as enhance fertility, therefore, biofertilizer can be claimed as the irreplaceable fertilizer for agriculture’s sustained development and organic farming as well. Therefore, development of the biofertilizer industry in Taiwan is very bright and optimistic.

V. Technical Analysis

(1) Technical overview

With the heightened consciousness toward environmental conservation, the application biofertilizer can help sustain the balance of the ecosystem and reduce environmental pollution. It is truly worth investing talent and resources for in-depth research. However, the production technology of biofertilizer is very similar around the world, depending mostly on research conducted by colleges or agricultural department institutions developing fungi isolation, purification, verification, production, and application techniques. Yet R&D among the commercial sector are still insufficient and therefore there is no especially significant country or technology.

(2) R&D trend

The focus of biofertilizer R&D in Taiwan is on nitrogen fixing bacteria, phosphoric releasing series, mycorrhizal fungi and organic decomposition bacteria organic hydrolysis fungi, etc. Although it is still in the fungi screening, manufacturing and application stage, the major nationwide projects currently undertaken by the Council of Agriculture has expanded the direction of R&D to nodule nitrogen fixing bacteria, phosphoric releasing series, mycorrhizal fungi, growth stimulating fungi and composite bioorganic fertilizer. Today, R&D results from the academic or industry sectors is tested in the agriculture research and extension station and then conceptually promoted. Two manufacturers have already completed technical transfer while there are still two industry and academia joint R&D projects in progress. There are also about eight manufacturers that are collaborating with colleges and technical R&D and facilitating manufacturers from The Innovation Incubation Center.

(3) Domestic talent resources analysis

1. About 66 persons in R&D

    (a) 10 persons at the Agricultural Research Institute and the Agriculture Research And Extension Station.

    (b) About 6 persons at Taiwan Salt and Taiwan Sugar Company's R&D departments

    (c) About 30 persons at schools

    (d) About 20 persons in privately owned companies

2. 144 persons in manufacturing (including production and administration)

Manufacturing of biofertilizer is mostly privately owned companies. From the Internet, there are 36 companies manufacturing biofertilizer. If each company has an average of 4 persons, then there should be about 144 persons in production.

VI. Composite Analysis

(1) Industry SWOT analysis

1. Advantages of investing in Taiwan

    (a) Has location advantage. Fertilizer is the most heavily used material in crop growing and has stable market demand.

    (b) Higher quality demand on domestic grown agricultural products and raising awareness toward environmental protection. Organic agriculture is in the midst of development, which is advantageous to the promotion and application of biofertilizer.

    (c) There is already a relatively good foundation of R&D talent and production fermentation industry in Taiwan. This gives an advantage over China and other Southeast Asian nations in terms of investment and development time.

    (d) Biofertilizer is a part of biotechnology, and thus enjoys preferential loans, preferential leases and tax breaks, as well as pathogenic fungi patent and knowledge property protection.

2. SWOT analysis

    (a) Strength

There is an abundant amount of microorganisms in Taiwan's soil, where good pathogenic fungi can be obtained. Taiwan's fermentation industry is already well established and provides a complete foundation for producing biofertilizer. Fertilizer is the most widely used material in agriculture and has very large domestic and overseas markets.

    (b) Weakness

Domestic biofertilizer manufacturers are mostly small and middle size enterprises, are short on capital, and do not have the ability for R&D. In addition, most are family run businesses, few have overseas operations. Farmers need to be more educated. The pathogenic fungi patent for the biofertilizer currently being developed needs to be strengthened.

    (c) Opportunity

Organic agriculture and environmental protection concept has been heavily promoted worldwide in recent years, which benefits the promotion of biofertilizer. Strategic alliance between biofertilizer and biopesticides can help diversification. Taiwan's location in the sub-tropical region is favorable to screening out good pathogenic fungi that can adapt to the Southeast Asian region.

    (d) Threat

Allowing agricultural products to enter Taiwan will affect domestic agriculture production, directly threatening the livelihood of farmers and ability to purchase fertilizer. Management of biofertilizer needs to be strengthened in order to reduce the sales of substandard or fake products in the market.

Strength Weakness

* Abundant source of microorganisms.

* Well established fermentation industry foundation in Taiwan.

* Fertilizer most widely used material, stable demand in domestic and overseas markets.

* Small and middle size enterprises, little capital.

* Most farmers need to be educated.

* Should strengthen application and protection of pathogenic fungi patents.

Opportunity Threat

* Development of organic agriculture and environmental protection concept on the rise in many nations.

* Strategic alliances, integrating biofertilizer and pesticide industry, go into product diversification and reduce costs.

* The pathogenic fungi developed domestically are better adapted than the pathogenic fungi from the cold regions of Europe and North America, which can be promoted into the Southeast Asian and China markets.

* Substandard and fake products in the market, affecting credibility of biofertilizer.

* Imported agriculture products affect production of domestic agriculture products, easily manipulated by multinational companies.


(2) Current development bottlenecks

1. Industry bottlenecks

    (a) Difficult to find talent within the industry, lack of research talent.

    (b) Quality of products inconsistent, quality unstable.

    (c) Besides farmers in high economic value crop areas, ordinary farmers lack knowledge of application.

    (d) Small scale of manufacturers with no R&D ability.

2. Technical bottlenecks

    (a) The preservation and stability technology for biofertilizer product's additives needs to be improved.

    (b) Product's multifunction needs to be improved.

    (c) Pathogenic fungi product's adaptability toward the environment and crops needs to be enforced.

VII. Current State of Industry Policy

(1) Research direction

1. Using nodule nitrogen fixing bacteria, phosphoric releasing series, mycorrhizal fungi, growth stimulating fungi and composite biofertilizer and compound biology organic fertilizer for high quality R&D.

2. Strengthen R&D and product multifunctional composite and stable products.

3. Enhance development and produce products that can strongly adapt to different soil environment and crops.

4. Must enforce composite multifunctional compound multi-function biofertilizers.

5. Continue to research biofertilizer with high stability and resistant to negative environment.

6. Pathogenic fungi must enforce the pathogenic fungi by the molecular biology techniques to research of infeasible culture pathogenic fungi on the land for high efficiency and good acclimatization products.

7. Enforce talent training and bring in new technology.

(2) Facilitation strategy

1. The research direction for biofertilizer is under the Council of Agriculture's technology and promotion plan where the research results from academia and industry collaboration projects are tested and promoted through the agriculture research and extension station.

2. Manufacturers are almost all small and medium size enterprises. These businesses are often short on capital, small in production scale, difficult to attract high level and R&D talent, and needs to be facilitated and integrated.

3. The facilitated manufacturers should have the ability to expand the overseas fertilizer market.

(3) Review of current policies

1. Domestic biofertilizer still lacks registration and management, quality of products inconsistent, related rules and regulations needs to be established for manufacturers to follow and reduce substandard and fraudulent products.

2. Today, the manufacturing of biofertilizer is through the conventional liquid and powder production methods, high quality powder production method needs to be enforced.

Copyright 2007 Maintain By | Biotechnology Industry Study Centre, | Taiwan Institute of Economic Research |