On 19 Nov. 2013, Shandong Longlive
Bio-technology Co., Ltd. (Shandong Longlive), the largest xylo-oligosaccharide
(XOS) producer in China whose total XOS capacity is 4,000t/a, released the research
results on XOS that the product can stimulate the growth of bifidobacterium,
which may be good for treatment for some diseases. Specifically, according to
Shandong Longlive, in order to explore the US market, the company has entrusted
David Geffen School of Medicine at University of California-Los Angeles (the
School) to testify the function and security of XOS for human being, and the
project started in H2 2011, according to Sweeteners
China News issued by CCM in
November.
According to the research results, XOS is not
absorbed by human body, and it is also not a kind of human nutrition. The
function of XOS for human body lies in its positive effect on human's
intestinal flora—XOS stimulates the growth of bifidobacterium. The research
results revealed that XOS has the potential treatment function on degeneracy
autism. The experimental study of the School has proved that the quantity of
bifidobacterium of children diagnosed with autism is less than that of normal
children, which means XOS may perform a treatment function as it stimulates the
growth of bifidobacterium. In addition, the research results also showed that XOS
may have a positive effect on treatment for some diseases in which intestinal
bacteria are involved, such as metabolic syndrome, schizophrenia and
Alzheimer's disease. According to Shandong Longlive, it is estimated that
20%-30% of the population in developed countries are suffering from the
diseases mentioned above. Therefore the unique function of XOS may stimulate
those sufferers' consumption of the product.
Shandong Longlive expressed that the purpose
for the research on XOS' function is to explore the overseas markets,
especially the US market. And the positive research results provide such an
opportunity. It is believed that the company will shift the focus of its XOS
sales strategy from the domestic market to the overseas markets.
In fact, almost all of Shandong Longlive's
XOS is sold domestically all the time. However, compared with other functional
oligosaccharides, such as fructo-oligosaccharide (FOS) and
galacto-oligosaccharide (GOS), the consumption of XOS in China increased quite
slowly in recent years, due to its small serving size in downstream products
and its low popularity among the Chinese public. For example, according to
Shandong Longlive, the sales volume of its XOS increased from 3,108 tonnes in
2009 to 3,532 tonnes in 2012. However, increases in the sales volumes of FOS
and GOS are way more significant. According to Quantum Hi-Tech (China)
Biological Co., Ltd. (QHT), a leading FOS and GOS producer in China, its sales
volume of FOS increased by over 1,300 tonnes to 10,259 tonnes in 2012 from
2009, and the sales volume of its GOS even increased to 1,234 tonnes from just
94 tonnes in 2009.
Although FOS is currently the main functional
oligosaccharide consumed in developed countries, its efficacy is not as good as
that of XOS according to Shandong Longlive. Besides, the public's health
consciousness in developed countries, such as the US, are higher than in China,
which hints that products with health care function will be more popular in
these countries. The research results offer more detailed data and
authoritative conclusion for the company to enhance the competitiveness of its
XOS, as well as attract the public's consumption.
For Shandong Longlive, high health
consciousness of citizens in developed countries means more sales
opportunities. Its large investment in the research was aimed at the entrance
in markets of developed countries. The research results are more favorable to
the company's XOS sales to developed countries than to China. Under the current
situation in China, including low health consciousness of the public and low
consumption growth of XOS, it is easier to explore markets in developed
countries than China's. Moreover, the new XOS production project of Shandong
Longlive with a capacity of 6,000t/a is predicted to go into operation in Q1
2014, which indicates that the company should consider how to digest its huge
production capacity of the product. Based on the reasons above, it is obviously
wise for Shandong Longlive to focus more on overseas markets than to the
domestic market.
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Sweeteners
China News, issued by CCM on
5th every month, offers timely update and close follow-up of market and company
dynamics based on China’s sweeteners industry. It also releases the latest
information on raw material supply, price update, import & export analysis
as well as consumption trend & competitiveness.
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