Amid sluggish funding in agtech, agricultural biologicals remain a hotbed of innovation, with Brazil becoming the largest market for these crop inputs, spurring investment interest from venture capitalists, major ag suppliers, and others.
Brazil’s biological market is worth $1 billion and has room to expand into bio-fungicides, according to Francisco Jardim, managing partner at SP Ventures, as shared in an article.
Jardim will moderate a session at the World Agri-Tech Innovation Summit in São Paulo, June 23-24, about scaling biologicals, alongside representatives from AgriThority, Aqua Capital, the Brazilian Ministry of Agriculture, and Micropep Technologies.
Brazilian farmers are using biologicals to address consistent disease, insect, and nematode pressures and environmental stresses that are common to tropical farming, Fabrizio Giolo, product development manager for Brazil & Paraguay at AgriThority, told AgTechNavigator.
“Growers in Brazil are very practical. If the product works under real-field conditions, ideally in [their] own farm, and delivers an interesting economic return, adoption happens fast. Strong local validation from private local and multinational companies, universities, cooperatives, and governmental institutions like Embrapa also helped accelerate adoption and product development,” Giolo elaborated.
He added, “Brazil is attractive because of the scale of agriculture and the possibility to test products under real field pressure in its large soybean, corn, cotton, and sugarcane areas, allowing fast validation and fast adoption when products perform consistently. Today growers are looking much more for practical solutions with operational fit and clear economic return than only sustainability claims.”
Additionally, Brazil’s multi-cropping system requires more products to keep soils healthy and productive, and biologicals are being incorporated into treatment plans and fertility programs, Giolo noted. However, challenges related to biological consistency persist, he added.
“Consistency is still one of the main challenges for the sector. Product performance can vary depending on climate, soil conditions, application timing, and overall crop management. At the end, growers continue using products that consistently help improve yield and profitability under real farming conditions,” Giolo said.
The investment thesis for biologicals in Brazil
Biologicals are not only gaining the attention of farmers, but also venture capitalists and major agricultural suppliers that are investing in the next generation of crop inputs. SP Ventures has invested in biological companies Decoy, Gênica, Puna Bio, and Promip and is working towards closing its third round.
Elsewhere, Brazilian biological company Symbiomics closed its Series A round of funding last year with support from Corteva’s venture arm. Additionally, chemical giant BASF acquired Texas-based biocontrol company AgBiTech earlier this year, which operates in Brazil.
“Biologicals aren’t attracting capital despite a tighter agtech environment — they’re attracting it because of it. When generalist money retreats, specialists move in. South America is the epicenter for a simple reason: the combination of regulatory tailwinds, massive row crop acreage, and a farmer base already conditioned by Brazil’s pioneering adoption creates a commercial proving ground that doesn’t exist at this scale anywhere else,” Sebastian Popik, founder and managing partner of Aqua Capital, told AgTechNavigator.
Popik added, “At Aqua Capital, we’re building a biologicals platform precisely because the fundamentals — input cost pressure, resistance to synthetics, ESG mandates from export buyers — are structurally compounding, not cyclical. The thesis gets stronger the longer you look.”
