pharmaasiaOctober 20, 2017
Tag: amino acids , market trends
Over the past few years, many Chinese amino acids manufacturers have changed their business focus to target the market of minor amino acids, like valine, isoleucine, and glutamine. As those products are also used in the healthcare and medicine industry, these are considered high-grade amino acids, and the profit for producers is higher than that for bulk amino acids. Bulk amino acids, like glycine and taurine, are comparably cheaper, resulting in several past scandals of companies adding a large amount of those into protein or health products.
Feed-grade and food-grade amino acids currently account for over 80% of the total market share, due to the huge demand for poultry and livestock raising industry in China. However, the competition in the feed-grade amino acid market is fierce, as many leading producers have been expanding capacities or upgrading technologies.
Pharmaceutical grade amino acids, especially, can boast promising prospects, especially in the Large Volume Parenteral (LVP) market. LVP plays a significant role in clinical treatments, with a large market demand, and Chinese authorities are working to standardise the use of LVP products.
Struggling with overcapacity
According to market intelligence firm CCM, amino acid products will have a larger scope of applications in the future. Recent years have seen increasing investments into China’s amino acids production, with leading producers announcing new production techniques or production expansions. All of this seems to bode well for the future of the market in the country, yet such continual production expansion is likely to result in overcapacity in the foreseeable future, despite the growing market demand.
Additionally, domestic enterprises are struggling with problems like weak R&D capabilities and a lack of core technologies, not to mention serious product homogeneity as well as weak quality assurance. To these businesses, cost control is important to maintain their cost and price advantages in the global market, resulting in some producers, like the Fufeng Group and Meihua Bio, moving their production to remote regions with low raw material and labour cost in China.
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