Abstract
STUDY GOAL AND OBJECTIVES
This report is an update of GA-103 - World Market for Fermentation
Ingredients (Business Communications Co., Inc., 2000), which referred to the
fermentation ingredients market situation of 1998. The fermentation industry
in the past 6 years has changed dramatically. While the main categories of
fermentation products reviewed in 1998 are still the same, the industry
structure within the categories has developed strongly in terms of technology,
markets, and in terms of producing companies.
In crude antibiotics, fermentation still plays a dominating role. However,
most antibiotics currently sold are manufactured by a combination of
fermentation and chemical synthesis. The price erosion for crude penicillins,
cephalosporins, and for intermediates and building blocks, which was already
starting in the mid-1990s, continued because of Chinese competition and
because of overcapacities. Smaller Western producers dropped out of the
business, developed into specialized markets, or switched to the manufacturing
of semi-synthetic products. Backward or forward integration helped as a main
survival strategy. The production routes for organic acids were streamlined.
The demand for citric acid, the main product in this category, increased
strongly. Prices fell until 2002, with the consequence that smaller producers
went out of business, and the larger ones added more capacity to profit from
economy of scale. After 2002, the market situation stabilized.
Amino acids represented by lysine, monosodium glutamate (MSG), and some others
show the same trend. The demand for lysine increased dramatically, and many
new capacities were added. Also, threonine and tryptophan developed strongly,
while prices for these products trended downward.
Enzymes as typical chemical intermediates enjoy a high popularity, and to the
extent that they are used in food processing, they developed in line with the
growth of the final end products. Enzymes used in feed, such as carbohydrases
and phytase, are becoming increasingly more popular, not only in Europe and
the U.S., but also on a global scale. Polysaccharides, such as xanthan, show
characteristics similar to enzymes, as they are also mainly used in food
production.
In the category of vitamins, vitamin C is still the main product, with one
fermentation step as part of the overall production route. A full fermentation
route exists, however; but it has not yet been installed on a large scale. The
production of riboflavin is now a full-fermentation process, and the synthetic
route has almost completely disappeared.
Carotenoides are still mainly produced by chemical synthesis; however, there
are attractive advances in fermentation that might enable a complete switch of
the technology to fermentation within a couple of years, at least as far as
beta-carotene and astaxanthin are concerned.
In the past it was possible to allocate fermenter capacities to output, a
consequence to the production value for all categories. This systematic
allocation is no longer possible for antibiotics and is hardly possible for
enzymes nowadays. Only for organic acids, amino acids, polysaccharides, and to
some extent for vitamins does such a relationship still exist. Due to strong
improvements of efficiencies, but especially because of the modified
production routes, fermenter size does not mean much in estimating production
capabilities, such as those of antibiotics. Production costs and production
pathways are increasingly important. Still, all fermentation processes depend
on carbohydrates. And the availability and costs of carbohydrates has changed
dramatically and is about to change even more fundamentally in the coming
years. In the past years, China was the preferred production site for many
fermentation products, but there are signs that this is to change. As a
consequence, this report focuses on the market for major fermentation products
and their inter-relationships with and dependency on carbohydrates.
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