Chinese up sorbitol production
Bio-chem will link up with Japan's Mitsui & Co to develop,
manufacture and sell the bulk reduced calorie sweetener sorbitol in
China under a new joint venture company.
Under terms of the agreement the venture will be 51 per cent owned by Global Bio-Chem with the remaining 49 per cent held by Mitsui on a total investment of US$15 million (€11.7million).
'The Peoples Republic of China is a massive market with enormous potential for corn-based biochemical products including sorbitol, ' said Liu Xiaoming, co-chairman of Global Bio-chem. We have the capability and the confidence that the joint venture will be successful in capturing business opportunities arising from the expanding sorbitol market in the PRC, he added.
It will produce 60,000 tonnes of 70 per cent solid base liquid sorbitol a year in a plant in Changchun, Jilin, starting from the second quarter of this year, Global Bio-Chem said in astatement.
The sorbitol product will be in different grades, namely vitamin C grade (used for vitamin C manufacturing), food grade (used in food production) and cosmetic grade (used in personal care.
With under one third of the calories of sugar, sorbitol - that is also noncariogenic - is the most commonly used polyol (sugar alcohol) since it is the least costly. According to market researchers BCC more than 1 million tons of sorbitol liquid and crystalline are sold in the US, Europe and Asia. All other polyols are relatively small in volume, with sales ranging from 20,000 ton 200,000 tons.
Used as a sweetener, the reduced calorie additive with 60 per cent sweetness of sugar has also found favour from food manufacturers for its humectant and texturising properties and is used in a landscape of food products, particularly snack foods and beverages.
The global market for polyols is estimated at $1.3 billion, with sales volumes of 1,397,000 metric tons in 2000. That volume is expected to exhibit an average annual growth rate of 2.7 percent for the next five years to reach 1,597,000 metric tons. Dollar sales will total roughly $1.4 billion by 2005 as the market grows at 1.3 percent, according to a study by Business Communications Company Inc. (BCC).
Market observers maintain that the higher prices of polyols in comparison to sugar will hold back demand for the product both at an EU and world level. But last year global sorbitol supplier Archer Daniels Midland stepped up production of its liquid sorbitol capacity at its Decatur plant in the US by 60 per cent in order to meet increased demand.
Leading players in sorbitol supplies include US giant Archer Daniels Midland, Swiss firm Lonza, Roquette America and SPI Polyols.
Unlike high intensity sweeteners such as aspartame, in Europe natural sweeteners, which include high fructose syrups, are covered by the protective and supportive system of the CMO Sugar - the common organisation of markets for the sugar sector.
CMO Sugar, in place since 1967, is part of Europe's Common Agricultural Policy (CAP). Reform to this sector is imminent with ministers from member states, together with Commission officials, currently discussing proposals to update the regime, left virtually untouched since its creation more than 30 years ago.
In Europe a handful of polyols - sorbitol, xylitol, lactitol, mannitol, maltitiol and isomalt - have been approved by the Scientific Committee for Food (SCF) for use in foodstuffs and fall under the 'additives' label. In the sorbitol has achieved GRAS (Generally Recognised As Safe) status.
The appeal of polyols - sugar alcohols industrially produced through hydrogenation of saccharides - lies not only in their low calorie content but also their suitability for diabetic food. Since they are not or only partly metabolised they require a lower insulin dose for digestion than sugar.