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This Industrial Summary is abstracted from, and summarized on base of, Market Overview of Food Additives in China, and is prepared in highlight form. In the present sample only some facts or conclusions are listed. Some details, like the list of major manufacturers and statistics, are excluded and marked with "xxxx" or "omitted". Please be noted. For more information about food additives, please Contact Us.

Last update: Oct 2002

Main Content

1. Food Additives Production History in China

In 1950s when People's Republic of China was just founded, the food additive production was almost vacant. The two large items at that time were monosodium glutamate (MSG) and yeast, whose production was 300MT/year and 12MT/year, respectively. There were only two small size sodium glutamate factories locating in Shanghai and Shenyang, respectively. And there were only two yeast manufacturers locating in Shanghai, with total production of 12 tons per year.

During 1960s, China began to do research work on food additives and made some breakthrough. The first zymin manufacturer in Wuxi city was born, with capacity of 10MT per year. In the mean time, Chinese researchers developed their own methods to produce xylitol, citric acid and saccharin.

But the food additive industry came to a halt during 1970s because of the Culture Revolution.

It is only since 1980s, when China activated the economic reform that the food additive industry grew up. The emergence of beverage industry in the 1980s drove the food additive industry substantially.

Entering 1990s, the Chinese food additive industry grew at high speed. The improved trading environment and the flowing of foreign investment into China to set up joint ventures accelerated the development of food additive industry. In the past 10 years the volume of food additive increase at the speed of 12% per year.

In 1990, the number of approved food additive reached to 1,044 and the total production of food additives reached to 470,000 tons per year. It was the first time in the history that the production of some food additives exceeded 10,000 tons per year, including sodium glutamate, citric acid, zymin, yeast, flavor and fragrance, saccharin, sorbitol.

According to the Food Additive Sanitation Standard GB2760-1996, issued in 1996, there were 21 categories of food additives, totally 1,460 species, to use in China.

In 1998, the National Food Additive Standard Technology Committee (NFASTC) approved 11 new products and 3 flavors. The total number of food additives allowed to use increased to 1,474 in 1999 and 1,700 in 2001.

Recent years the food additives industry in China went into a developing stage.

2. Current Production of Food Additives

At present there are about 1,500 food additives producers in China. About 400 are big food additive manufacturers. Among the Chinese producers, 10% are state owned ones, 80% are private ones and 10% are joint ventures.

The strong items of food additives include sodium glutamate, citric acid, xylitol, sodium benzoate, sorbic acid/potassium sorbate, ethyl malto, and synthetic sweeteners like saccharin, aspartame.

The production of some important food additives in the past few years is listed as follows:

Table 1. Production of major food additives in the past few years. (Unit: MT)

3. Brief introduction to Some Food Additives in China

1) Acidity modifiers

Among the 20 acidity modifiers, 17 are available in China, like citric acid, fumaric acid, adipic acid, phosphoric acid, acetic acid, lactic acid and tartaric acid. The development of acidity modifier focuses on the composite additives.

- Citric Acid

Citric acid is oversupply in China. The present capacity of citric acid is nearly xxxxMT/year. There were once around 100 manufacturers in China. But after severe competition most small factories especially those with capacity less than xxxx MT/year had been kicked out of market gradually because of the inferior position. At present there are around 25 active manufacturers in China. The biggest producer is BBCA, with capacity of over xxxx MT/year.

About 70-80% Chinese citric acid is exported to oversea market every year. The Chinese citric acid is mainly exported to USA, Japan, Belgium, Netherlands, India, etc. In 1999 & 2001 the export quantity of citric acid is 183,313 MT and xxxxMT, respectively. The enlarged export quantity arises from the cheap price, thus makes the Chinese materials very competitive in the world market. This, on the other, incurred an accuse from USA for "dumping" . 12 Chinese manufacturers responded the lawsuit in 2000 and won at last.

The current consumption of citric acid in China is estimated to be xxxxMT/year, mostly in the field of food additive. It is expected that the domestic consumption will be increase at 20% per year in the next few years and the total consumption will be xxxx MT/year in the near future.

- Fumaric Acid

The total production capacity of fumaric acid (industrial grade and food grade) is about xxxxMT/year. However the Chinese fumaric acid has no ability to compete Korean material and Germany material. The food grade fumaric acid is under development in China.

- Adipic Acid

The total production capacity of adipic acid is about xxxxMT/year. The biggest manufacturer is Sinochem Liaoyang.

- Food Grade Acetic Acid

The production of industrial grade acetic acid in China is about xxxxMT/year. But the production of food grade acetic acid is not large. The food grade acetic acid is used for the production of vinegar. So far the vinegar production in China is over 2 million MT/year.

- Lactic Acid

The production capacity of lactic acid in China is about xxxxMT/year. There are about 30 manufacturers of lactic acid in China and the actual production is about xxxxMT/year. China is weak in the production of lactic acid derivatives.

- Tartaric Acid

The production capacity of industrial tartaric acid in China is about xxxxMT/year while the food grade D-tartaric acid capacity in China is only about xxxxMT/year. It is a growing item in China.

- Maleic Acid

Maleic acid is also available in China. The total production capacity is expected to be xxxxMT/year.

2) Antioxidants

The antioxidants allowed to be used in China include BHA, BHT, propyl gallate, PG, D-sodium isoascorbiate (iso vitamin C), Vitamin E. Because of the high price, the actual application of them in China is not are wide as that in oversea countries.

- BHA

It is reported that there is only one manufacturer of BHA in China, Shanghai Yimin No.4 Factory.

- BHT

There are two manufacturer so BHT in China. They are Shanghai Xiangyang Chemical Factory and Beijing Yanshan Chemical Factory. The total production capacity is about xxxxMT/year.

- Propyl Gallate

The production of propyl gallate is quite small, about xxxxMT/year.

- D-sodium isoascorbate (Iso vit C)

The production capacity of D-sodium isoascorbiate is about xxxxMT/year. There are more than 7 manufacturers in China. Because of the cheap price and relative simple production technology comparing with vitamin C, it is almost a trend that this product will replace vitamin C in the food additive section. The largest Chinese manufacturer is Jiangxi Dexing Iso Vit C Factory.

- Polyphenol

Recent year the production of polyphenol, an extract from green tea, has been increased in China. But the content of polyphenol is low and the quality is not good. In addition, Chinese polyphenol is mainly for export. The domestic application is quite small.

- Vitamin E

The Chinese VE is very competitive in the international market because of its low price. There are more than six manufacturers of VE in China. The total production capacity in 2002 is xxxxMT/year. The two factories in Xinchang occupy over xx% of Chinese production. But most of Chinese VE is for export or for feed industry. The application of vitamin E in food industry is quite limited, with no more than xxxxMT/year.

3) Colorants

There are xxcolorants allowed to be used as food additives in China. 8 of them are synthetic ones. xxxx% of them are natural colorants.

Natural colorant is good for its health safety but is not stable under normal circumstance. Among the natural colorants, caramel is the largest items of colorant in China. The total production of it is more than xxxxMT/year. Other important colorants include capsanthin, red dyes, radish red, etc. Most of these items are exported to Japan.

Natural colorant is good for its health safety. But it is hard to maintain the stable quality and its price is higher than synthetic colorant.

4) Emulsifiers

Emulsifier is a big item among the food additives. There are xx emulsifier items allowed to be used in China. At present China mainly produces fatty polyalcohol ester and lecithin. The total production of food grade emulsifier in China is about xxxxMT/year.

- Fatty Glycerin

The biggest items of emulsifier is fatty glyceride. There are over 40 manufacturers to produce this product in China. The total production is expected to be xxxxMT/year, 50% of them are for food application. Recent years more and more Chinese manufacturers are using molecular distillation technology to obtain the product with high content, especially in the production of mono glyceride.

- Fatty Saccharine Ester

China begin to do research on fatty saccharose ester in 1980s. Now the production capacity of this product is more than xxxxMT/year. The important manufacturers include Zhejiang Jinhua Pharmaceutical No.2, Zhanjiang Lianjiang No.1 Food Factory, etc.

Fatty saccharose polyester, the derivative of fatty saccharose ester, is a new product which can replace cooking oil, with low calories. The active researchers include South China University & Technology.

- Tween and Span

There are over 10 manufacturers of Tween and Span. But these manufacturers mainly produce industrial grade product. Recently some manufacturers began to produce food grade Tween and Span. It is reported that these Chinese manufacturers are producing food grade tween and span: Nanning Glucose Factory, Dalian Liushun Chemical Factory, Shanghai Chemical Reagent Factory and Wenzhou Qingming Chemical Factory.

- Propylene Glycol Ester

China began to do research on propylene glycol ester in 1980s. The active researchers include Beijing Chemical Research Institute, Shanghai Chemical Reagent General Factory, etc. The present production is no more than xxxxMT/year.

- Lecithin

The development of lecithin grew fast in the recent year, especially in the northern China. Comparing with foreign product, the Chinese lecithin is low in active content, because Chinese manufacturers can not solve the problem of decolorization and deoderization. So far the Chinese lecithin can only used in the food with no high requirement. The import and export of lecithin in 2001 is xxxxMT and xxxxMT, respectively.

5) Zymin (Enzyme preparations)

There are over 100 zymin manufacturers in China. The total production capacity is about xxxxMT/year. However the production of zymin is monotonous. E.g., the major zymin items are saccharifying enzyme, amylase and protease. The production of these three products accounts to about 68%, 18% and 11%, respectively of the total production.

Table 2 Product structure of zymin in China

Many oversea manufacturers launched into China in the 1990s. The biggest foreign investor is xxxx.

6) Nutrition intensifiers

Nutrition intensifiers are developing and promising food additives in China. Nutrition intensifiers include vitamins, mineral, amino acids and protein. There are 61 nutrition intensifiers allowed to use in China. The vitamins allowed to add in the food are VA, VB1, VC, DDP.

Now China can produce all kinds of vitamins. Chinese vitamins are becoming ever competitive in the world market, especially VA, VBs, VC, VE. The mass production of vitamin A began in 1999. There are more than 3 manufacturers of VB1 in China.

The amino acid allowed to add in the food include lysine HCL, DL-methionine. Now China can produce all kinds of 18 amino acids that are essential to human body.

Many big foreign companies are staring at the big pie and starting to share it.

- Vitamin C

Among the vitamins, the vitamin C is the largest item with annual production capacity of nearly xxxxMT/year. While the annual export is about xxxxMT. Apparently the Chinese vitamin C is focusing on the oversea market. There are 4 actives producers in China. The most active producers are NCPC, NEPG, Jiangshan.

- Taurine

The production capacity of taurine in China is xxxxMT/year. There are about 10 manufacturers. The active ones include Changshu Yonglida, Zhikang Pharma, etc. China has become an important exporter of taurine.

- L-Carnitine

L-carnitine is a new product. China has able to produce L-carnitine since 1998. So far there are about 6 manufacturers. The production capacity is xxxxMT/year. The active producers include NEPG and Shendong Fine Chemicals.

At the moment Chinese L-carnitine has not been recognized by the oversea consumers. However hopefuly sooner or later the Chinese L-carnitine will play an ever important role in the world market.

7) Preservatives

There are many kinds of preservatives allowed to use in China, including dehydro acetic acid, sodium diacetate, sulfur dioxide, potassium metabisulfate, etc. The large items in China include sodium benzoate and sorbic acid/potassium sorbate. Nisin is also an important preservative being used in China. Some exporters begin to sell this product to overseas.

- Sodium benzoate

The total production capacity of sodium benzoate is estimated to be xxxxMT/year. The biggest producer of sodium benzoate is Wuhan Organic Chemical Factory.

The export quantity of sodium benzoate kept increasing in the past years. In 2000 and 2001, export quantity of sodium benzoate is xxxxMT and xxxxMT, respectively.

In the same time the consumption in the Chinese market also grew fast. In 2001, about xxxxMT of sodium benzoate has been consumed in China.

- Sorbic acid and potassium sorbate

In recent years the Chinese sorbic acid and potassium sorbate entered the world market. The total capacity of sorbic acid and potassium sorbate is estimated to be over xxxxMT/year, including the of joint venture of the former Hoechst AG in Nanning. The leading producer of sorbic acid is Nantong Acetic Acid Factory and Yuyao Huanglong Group. In the years 2000 and 2001 Nantong Acetic Acid Factory and Yuyao Huanglong Group kept increasing the capacity. The Nanning joint venture aimed to the domestic market however their price is much higher than other domestic producers, which is probably arises from the higher management cost and higher investment comparing with the domestic producers.

About xxxx% of sorbic acid and potassium sorbate are exported to the oversea market however the domestic consumption has been increasing in the past years.

8) Sweeteners

There are two types of sweeteners, nutrient type and non-nutrient type. The former includes sugar and sugar alcohol like glucose, fructose, isomerose, maltose, sorbitol, xylitol, mannitol, etc. The latter includes chemical synthetic sweeteners like saccharin, cyclamate, stevia, aspartame, acesulfame potassium (ACK), licorice. Both nutrient sweeteners and no-nutrient sweeteners are available in China. Some items are strong in the world market, like sorbitol, saccharin, etc.

Some products that were imported in the past are now exported to overseas, like aspartame, ACK. There are four active producers for aspartame and five active producers for ACK in China. But the price of these two items dropped very fast in the past three years.

In recent year, some Chinese researchers begin to synthesize sucralose.

- Aspartame

In 1997 China began to produce aspartame. Some oversea producers like xxxx lowered the price of aspartame in order to keep the dominating position in the world. Unexpectedly the Chinese manufacturer survived and grew stronger. Later, it is hard to resume the higher selling price, for the Chinese manufacturers grasped the production technology and begin to decrease the price further in order to snatch some market in the international market. In recent years, the limitation of the production of saccharin and the availability of L-phenylalanine makes it possible for the mass production of aspartame in China, making China an important aspartame producer in the world.

By 2002 therer are 6 producers of aspartame in China. The total capacity is nearly xxxxMT/year. The active ones are Wujin Niutang, Xiaoxing Yamei, etc.

- ACK

The production of ACK did not increase much these years because of the violation to the patent holder (the former xxxx). There had been once 6 producers to produce ACK in China, with total capacity of nealry xxxxMT/year. However, there is only one manufacturer, Hangzhou Sanhe Food Additive Factory, whose production line is proved to be different from the patent holder. Sanhe also won the count issue with Nutrinova, a branch company of Aventis, in 1999. But unfortunately the Sanhe's sales in oversea market is not desirable.

- Saccharin

Recent year more and more Chinese organizations call for the limitation of saccharin. In 2000, the Chinese government decided to closed down xxxx of the 13 approved saccharin manufacturers, leaving only xxxx manufacturers to produce it. The aim of this strategy is to survive the sugar industry on which tens of millions of peasants are living. But saccharin is still an attractive sweetener for its cheap price, both for the Chinese food manufacturers and for the oversea consumers. In 2001 the consumption of saccharin in the domestic market is xxxxMT. The export of saccharin in 2001 is xxxxMT.

- Sorbitol

The Chinese sorbitol production has been arising from, and has been subject closely to, the vitamin C production. By 2002, there are 17 active manufacturers of sorbitol syrup and 6 active manufacturers of solid form sorbitol in China. Of those who are active in production, the capacity in 2000 and 2001 is claimed to be xxxx MT/year and xxxxMT/year (on base of 70% syrup), respectively. The Chinese capacity to produce sorbitol excesses the actual operation due to high production cost and outdated production technology, which makes Chinese product uncompetitive to imported material.

- Xylitol

China is the biggest country to produce and export xylitol. The total export quality in China accounts to about xxxx% of the world trading quantity. By 2001 there are about 50 manufacturers having ability to produce xylitol and xylose. The total capacity is xxxxMT/year.

9) Thickeners

There are 26 thickeners allowed to use in China. The main thickeners include pectin, karrageeenen, gelatin, xanthan, starch and modified starch, and CMC. It is estimated that the total demand for thickener is about xxxxMT/year.

- Xanthan

China produced this produce since 1992. Now there are 10 manufacturers in China including Nanjing Jinhu, Shandong Zibo Zhongxuan, etc. The production capacity in 2001 is xxxxMT, much less than that of Kelco.

- Pectin

The production capacity of pectin is no more than xxxxMT/year. The main reason is that the product yield is low. Every year China has to import about xxxxMT pectin

- Karrageeenen

Karrageeenen is available in China but the production is quite little, about xxxxMT per year.

- CMC

CMC industry develops fast in recent year. It is estimated that the total production capacity of CMC in China is about xxxxMT/year but only xxxxMT are used for good application. The

- Gelatin

It is estimated that the demand for gelatin in China is about xxxxMT/year but so far China can produce no more than xxxxMT/year. The balance has to be imported.

- Starch and Modified Starch

The competition among the Chinese starch manufacturers is severe. Among over 1,000 starch manufacturers in China, only those whose production is more than xxxxMT/year survived in the past competition, including Jinlin Huanglong, Jilin Dacheng, Shandong Juneng, etc. In 1997, the starch production came to 2.63 millions MT and the production in the recent years maintained at 2,500,000-3,000,000MT/year. Part of them were further used to make glutamate, yeast, sorbitol, glucose, modified starch, citric acid, enzyme, VC, etc.

10) Flavor Ingredients

The flavor ingredient industry developed fast in the past few years. The biggest ones include monosodium glutamate and yeast extract. China also began the production of guanosine monophosphate (GMP) and inosine monophophate (IMP), and it is a trend that the production of these products have been increasing in the past years.

- Monosodium glutamate

Now the Chinese production of monosodium glutamate (MSG) accounts about xxxx% of the total world demand. China is mature in the fermentation technology for MSG. Now the active MSG producers include Henan Lottus Group, Linghua Group, Jiangsu Juhua Group, etc.

- Yeast

The next large flavor is yeast, with annual capacity of xxxxMT. The largest one is Angel Yeast Co., Ltd., with capacity of xxxxMT/year. In recent years, Guangdong Jiangmen Biological Development Center has developed selenium-enriched yeast with capacity of xxxxMT/year.

11) Flavor & Fragrance

There are about 950 Flavor & fragrance species in China. The production of flavor and fragrance is estimated to be xxxxMT/year and xxxxMT/year, respectively. About 742 kinds of flavor & fragrance is used as food additives. The total production of F & F (food grade) in China is about xxxxMT/year.

Most of synthetic flavors were developed after the foundation of PRC, like vanillin, coumarin, heliotropin, phenyl ethyl alcohol, synthetic camphor. Each of the export quantity of these items is over xxxxMT per year.

After the economic reform, China managed to grasp the production technology of some products like sandalwood 208, methyl cedrone, maltol, ethyl maltol, dihydromyrcenol. It needs large amount of money to develop a new synthetic flavors. But China is lack of money and has to rely on the copy technology.

In recent years, China become strong in some synthetic flavors like synthetic camphor, synthetic linalool. At present, in addition to supplying the domestic market, some synthetic flavor are exported every year like maltol, ethyl maltol, ethyl cyclopentene alcohol ketone, vanillin and some heterocylic compounds.

4. Problems of Food Additives Industry in China

- Short supply of food additive species. So far there are 4,000 kinds of food additives allowed to use in the world. But in China there are only 1,700 species.

- Product structure is not rational, as in the product structure of enzyme preparation.

- Production technology is low. China is weak in the environmental protection and wastewater treatment during the production of food additives.

- Small scale in the application. The development pace of new products behinds the industrial demand. E.g. China has to import quite a large quantity of isomolt and phytase every year.

- Small in product capacity

- Weak in the product promotion.

5. Approval Procedure for New Food Additives

(Omitted)

6. Supplement Food Additives and Additives Enlarged Application Area

On April 7, 1998, China issued the supplement Food Additives Species and the Food Additives that enlarged the application area, on request of applicants. This action was based on the following standard: