Status report on global Neem usage - Biblioteca Nacional de Portugal

3. NEEM AS A NON-SYNTHETIC PESTICIDE
Comparing the economic aspects of a biological neem pesticide with synthetic pesticides is
something that needs to be considered separately for each country concerned, since the
prices of synthetic pesticides and neem seeds differ from country to country. Although there
is a general tendency to abolish subsidies in many DC based on the pressure of the World
Bank and other donors, yet cheap synthetic pesticides are one decisive factor inhibiting the
spread of neem pesticides. Chemical pesticides are still often subsidised by governments or
even made available by them, to encourage the growers to use pesticides in the first place.
However, even in countries where pesticides are not subsidised, neem products have to date
been relatively expensive and are offered at prices 30%-40% higher than such standard products
as Karate, Decis etc. (34, 36,37) since it is more promising for the small manufacturers
to go for the high-quality, high-priced niche markets (35, 36).
Still, a potential market already exists for neem pesticides in niche markets where neem
competes more with other high-priced conventional and biological pesticides such as IGR, Bt
products etc.
Niche markets served include organic farming, cases of pest resistance where conventional
pesticides have failed, and crops where pesticide residue cannot be allowed due to consumer
sensitivity. The latter case is of increasing significance due to the recently enforced
EU regulation and the Consumer Act in the US.
Additionally, neem pesticides have a good future potential application as a standard in certain
cash crops, and there might also be the possibility of moving into mass markets, reducing
the price and competing with conventional pesticides. This however bears a risk for
small neem manufacturers who do not have sufficient capital to offer pesticides at low rates
to establish themselves on a particular market, as the huge supra-national agro-chemical
suppliers do.
It is also doubtful whether such a way of marketing is necessary, since there are several
examples of neem being applied less frequently and therefore working out cheaper in the
medium-term than conventional pesticides. This is due to the fact that the agro-system is
more stable when neem is used than when conventional pesticides are applied, and favours
natural antagonists. In addition neem is also strengthen the physiology of the plants.
It should not be forgotten that until now the long-term costs of synthetic products have not
been considered – that is, their lasting effects on the natural environment. For example,
synthetic pesticides may contaminate water or cause poisoning or allergies, which in turn
may incur immense costs for society in general. The authorities should cover the long time
costs by taxes on pesticides according to their toxicity. Indeed we can find that governments
in DC often subsidise or permit the import of pesticides free of taxes (in contrast to other
investment goods) because they want to promote local agricultural production with the import
of production factors such as agrochemical (High External Input Agriculture, “Green
Revolution”)
However, when assessing the economic efficiency of neem, it is important to remember that
other secondary products can be obtained from the tree, which not only constitute additional
potential forms of usage but also forms that can be marketed in their own right. Another
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