November 2024
By: Robert Birkett
CropLife Latin America president José Perdomo explains the significance of key recent changes in crop protection policy across the region to Crop Science Market Reporting’s Robert Birkett.
CropScience Market Reporting (CSMR): What aspects of Brazil’s 2023 Pesticide Law brings the most significant change for agrochemical supplier sandgrowers?
Jose Perdomo (JP): Rather than change, the legislation brings impact. Brazil was already on track to use a science-based risk assessment approach. Still, the new legislation provides legal certainty to the system and its users, defining regulatory competencies and tracks.
Major reforms
Major reforms include centering pesticide approvals at the Ministry of Africulture rather than the previos tripartite approval system including the enviromental agency, the Ibama, and national health surveillance agency, the Anvisa. Those two agencies will carry out their assessments and report to the Ministry rather than be requiered to aslo approve a product.
Deadlines for:
- New technical and new formulated product each: at 24 months.
- Formulated product, generic product, technical equivalence product, pre-mixture: 12 months.
- “Identical” formulated product: 60 days
- Product for use in organic agriculture, biological agent product al 12 months.
CSMR: When does the sector expect significant impacts or improvements to become visible?
JP: New regulation tends to trigger an adaption phase or learning curve. Also, since it is legislation, the executive may need to issue implementing regulations. A 12-month window after issuance is reasonable. There are not really any initial observations on its implementation.
However, risk assessments have become mandatory for the registration of new products and modifications in uses that involve an increase in application rates, inclusion of crops, application equipment, or in cases of re-assessments. We at CropLife see the redictability of this type of assessment in the law as generating greater legal certainty. The new approval process deadlines have provided greater predictability for the sector, and we anticipate faster assessment.
CSMR: Does the law impact the rest of the region, and if so, how?
JP: Sure, when an agricultural powerhouse asserts a science-based approach to regulation, it sends a strong message to the neighbouring countries and worldwide in general.
CSMR: What signs are evident that the new law is influencingneighbouring markets and regulatory regimes?
JP: None directly, really. Mercosur (trading bloc including Argentina, Brazil, Paraguay, Uruguay and Chile) never resulted in a pesticide regulatory harmonized region. That said, Mercosur has been blunt and monolithic in voicing its views about its food systems to the EU, bilaterally in FTA talks and multilaterally. Not surprisingly, WTO recently confirmed that sustainability is not a one-size-fits- all solution, let alone to be imposed by a region over trading partners.
Argentina
The new Argentine government warned that there would be growing pains to its radical change in economic policy.
CSMR: Has there been initial pain for agribusiness? If so, how is it being manifested?
JP: Due to the legacy left by the economic policy of the previous government, changes are not being made at great speed. Still, due to a movement towards an open economy, improvements in the macroeconomy are already being perceived, and positively spilling over into the agro-industrial sector.
CSMR: What are the hopes or fears fromm acro-policy shift in Argentina?
JP: The population is strongly backing changes that the government is carrying out with patience. But improvements in the macroeconomy will need to swiftly move to the microeconomy where salaries, pensions, and retirements can adjust, which is projected to move into positive territory by the end of this year.
Argentina is facing a cyclical recovery, the reduction of the fiscal deficit by 15 points of GDP means that savings are returning to the productive sector, which will lead to an increase in
investment, and this will boost the economy.
CSMR: What major changes being implemented or planned in Argentina would you highlight for crop protection and agriculture policy?
JP: The elimination of export duties on certain categories of meat and the dairy sector added to the reduction of tariffs from 12% to 2% for irrigation equipment, and the de-bureaucratization of the grain trade are some of the most relevant steps taken since the new government began last December.
Specifically for the crop protection sector, tariffs on herbicides have been lowered and key tariffs eliminated to lower the cost of fertilizers. These have resulted in a reduction in the price of these inputs. For example, the price of urea was reduced from $830 in February to $588 dollars this month.
CSMR: What improvements have been evident in the economy other than the aforementioned lower urea prices in Argentina?
JP: After the disaster of the historic drought that affected the country during the 2022/23 campaign, the 2023/24 harvest shows a much clearer performance in general terms, although with disparate realities depending on each grain.
Production volumes increased by 60% year-on-year and the value of agricultural exports rose by 23%. If we take exports by marketing campaign and add other agricultural products (other grains and derivatives), the estimate for the 2023/24 campaign reaches $30.7 billion, a recovery of some $5.7 billion.
The recovery not only impacts the external front by generating foreign currency [income] but also impacts the national economy: the gross added value of grain production in the new campaign has tripled compared with 2022/23, reaching more than $15 billion. In this new scenario, turnover sales of agricultural machinery in 2024 have more than trebled compared with 2023.
Central America
CSMR: How far has legislation seeking an owehaul of pesticide rules in Costa Rica progressed since its launch at the start of 2023?
JP: Bills in Congress are still under discussion.
CSMR: What proposed changes and their implications would you highlight?
JP: New regulations would not introduce new environmental risk evaluations. Whoever cannot comply with a risk assessment would not be able to comply with existing nor with future regulations. The issue that our members are fighting is timelines. The authority provides limited timeframes to file data at risk of archiving the dossier if deadlines are not met.
CSMR: How extensive would the impacts of changes be on registration and re-registrations?
JP: The issue in Costa Rica has been the registration process backlogs. Requiring the entire registration calendar to undergo re-registrations, with unclear rules and limited agency resources, puts pressure on the system itself. Thus, there is an impact on new registrations that have to remain in the queue while the whole issue is clarified.
A new proposal was expected to have been unveiled in 2024 and Costa Rica could reportedly “normalize” the process of registering agrochemicals.
CSMR: Has it been officially proposed? What is meant by “normalized”?
JP: The authorities are still discussing the content of the reform of the registration system as there is no agreement between the Ministry of Agriculture and the Ministry of Environment.
It is not clear when the reform will be ready. For the pesticide industry, the most urgent thing is the extension of the deadline for re-validation of current registrations. Otherwise, about one-third of the current portfolio could be lost.
CSMR: Does the sector feel that any changes are sufficiently negative as to challenge them and If so, how is it challenging them?
JP: No, not our sector. Our members can comply. It is an issue of timeframes and deadlines. There was a frivolous legal case brought against the whole regulatory system. We are unsure on whether it has merits to land anything.
CSMR: How are regulatory developments in Panama driving pesticide withdrawals?
JP: Panama’s impulse to ban a whole array of products is slowly vanishing. Discussions about the rationale of bans, beyond activist motivation, may reduce the impact to a handful of products that are not even on the market, anyway.
CropLife’s analysis shows that the authorities' proposal to ban products classified as I - a [extremely hazardous] and I - b [highly hazardous] has been contained from the original list of 26 molecules; the proposal has been scaled back to just 11. The industry continues to defend due process and the technical-scientific basis of any regulation with the political authorities.
On the other hand, Honduras published a new regulation in January this year. The industry is working with authorities on best practice for implementation, although it may be too content-heavy due to the limited resources within the regulatory agency.
CropLife notes that “it is expected” that registration staff will strengthen their capabilities to avoid delays in the registration of new agrochemicals.
CSMR: What is a key change in the regulation. What is your or the sector’s response to it ?
JP: The new regulation has several loopholes in the administrative process that make it virtually impossible to register a pesticide. It contains many requirements such as environmental risk assessments, which the registration office is not equipped to deal with, lacking sufficient or qualified staff. The industry is working with authorities to push reforms to improve the efficiency of the registration system, but it will not be ready by the end of this year.
You may be interested in: Regulatory Outlook
Harmonization efforts in Central America
There are drives for harmonization on risk assessments and mutual recognition in Central America, potentially including Mexico.
CSMR: Which countries are involved? And what policy areas are the main targets for harmonization?
JP: I am not sure that it involves Mexico or that MAD (mutual acceptance of data) and mutual recognition are in play. There is a regional customs union project on maximum residue levels (MRLs) that involves harmonizing registration and biological regulations. Discussions with grower groups and Central American bodies are under way.
CSMR: What are the timelines on this harmonization? And how far evolved is it?
JP: It is hard to predict. Previous harmonization efforts have taken years and involved dozens of negotiations without a tangible result.
CSMR: Are policy differences an obstacle? Or is there a growing similarity on agrochemical policy in the region?
JP: The only harmonized regulation issued has been on labelling, and it was a bitter experience. Countries have not shown the discipline to abide by a harmonized regulation, so we consider these processes with caution in this region.
The implementation of the 2021 harmonized labelling regulation at the customs union continues to be delayed because several countries have not yet approved the new labels and the interpretation of the standard is not harmonized among countries.
Elsewhere in Latin America, Andean countries are advancing implementation of their harmonized regulations. Some environmental risk assessment tools have been adopted, the same as re-entry interval guidelines between Colombia, Ecuador, and Peru, in a combination thereof.
Bolivia is advancing in its capacity building. To achieve the proper implementation of Andean Decision 804 on registration and control of pesticides and Andean Technical Manual 2075, especially regarding the adoption of GHS (Globally Harmonized System) or globally harmonized labelling, authorities in Colombia, Ecuador, and Bolivia have received training from the industry on GHS implementation. As of now, Colombia and Ecuador are adopting this labelling.
