Status Report on Global Neem Usage - Gtz

3. NEEM AS A NON-SYNTHETIC PESTICIDEAs mentioned above more economical in depth investigation are necessary and all criteriahas to be taken into consideration to get a more precise picture about the economy of neembased pesticide application.Given the above figures there is still the perception that neem pesticides are too expensiveand can only compete under the given frame conditions in niche markets. Therefore thefollowing questions are of importance:• Are the current prices determined by the technology, management skills or form ofmarketing or• if all the factors are optimised – are the current product prices reflecting the laboriousprovision of raw material.Additionally it would be of interest which frame conditions must be changed to enable neempesticides a higher market share. Details of the study are presented elsewhere (34, 37):Based on the one step extraction technology the following results were gained:• The scale of production costs decreases when a greater quantity of pesticide is produced.• Marketing and distribution system of the present neem products are underdevelopedBoth factors alone would enable a price reduction of 25%-30%, which would make the neempesticides much more competitive with standard synthetic pesticides. Precondition would behigher investments in machinery and most of all in effective marketing and distributionsystems. A constraint might be in the long term a shortage of high quality raw material.Concerning the frame conditions main recommendations where:• Governmental research and extension systems should work out integrated croppingsystems which make use of neem products (e.g. IPM, organic farming systems) and• demonstrate and train farmers to use these systems.• The import of neem raw material and products should be free of tax (as it is currently thecase with synthetic pesticides in many DC)• Environmental and forestry departments should consider the planting of neem trees forfruit production in their programmes (planting space)One great handicap is the poor marketing and the resulting limited access that farmers haveto neem pesticides, particularly in those developing countries where neem products aremanufactured. The manufacturers are generally NGOs or small scale businesses withcomparatively small capital available to be invested in the marketing the products. Inaddition, most of them are not integrated into the existing structures for distributingpesticides. India is the one exception, since here there is a series of small, medium-sizedand larger enterprises manufacturing neem pesticides (of varying quality) and other neemproducts. The marketing is professionally organised and demonstration and training of IPMsystems which are integrating neem products are supported by the government.31