Status report on global Neem usage - Biblioteca Nacional de Portugal

5. PROSPECTS AND POSSIBILITIES FOR FUTURE NEEM USAGE
Most technical problems in neem processing have been basically solved, at least where
higher technology is used. For simple and cheaper neem extracts there are still some problems
such as the shelf life of neem extracts produced from one extraction step, formulation,
rheological properties at lower temperatures etc.
What was lacking within the previous GTZ neem projects was the knowledge about economic
data on processing and the national economic level as well as marketing strategies,
and market potential. Only few studies are available, which are based on limited, weak and
now obsolete data (11, 14).
It was on this background that GTZ conducted an economical analysis of neem manufacturing
and market analysis (34 – 37, 42) which intends to answer the following key questions.
Key questions of the evaluation:
• Is neem processing profitable for small scale entrepreneurs in developing countries?
• What are the key factors which determine if neem processing is profitable?
• To what extent can synthetic pesticides be substituted by neem pesticides?
• What are the “bottlenecks” for neem products to gain a greater market share?
• Are the constraints caused by the internal factors of neem processing or by the frame
conditions?
• What factors determine the price of neem products?
• What is the potential market share for neem products?
A comparison and economic assessment of the existing neem processing ventures on small
entrepreneur and of NGOs level has been carried out end of 1999.
• The key factors for neem processing in developing countries are labour costs and skills
(quality of the products, management skills) and to a certain extent the price of the raw
material
• Based on our study in all 3 countries neem processing is a or could be a highly profitable
business
• At the present stage neem pesticides are covering a new created „niche“ market or are
competing with other high priced synthetic or non-synthetic pesticides
• At the present stage neem pesticides are market as „generic“
• The niche market is not exploited to its full extent due to weak marketing concepts
(limited investment in marketing and distribution, unfavourable frame conditions, etc)
• Considering the pricing only (not taking into consideration the avoidance of environmental
and health cost as well the chance to have a proper tool to develop a more stable
farming concept) neem pesticides have to be 25-40% cheaper than offered at the
present stage
• With better marketing on one hand and improved management and processing skills on
the other the profit margin would be considerable higher
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