China direct

High stevia volumes predicted despite low price and limited production

By RJ Whitehead

- Last updated on GMT

Related tags Stevia China

© iStock
© iStock
The rapid growth of China’s stevia market has been leading manufacturers to look at ways to capitalise on increasing domestic and global demand. 

At the same time, though, local stevia prices have been on a continual decline due to rising capacity and growing competition. 

According to market intelligence company CCM, volumes will continue to grow this year as more businesses launch new production lines to satisfy the demand.

China’s stevia market began to boom in 2015 in tandem with growing interest in the ingredient after food and beverage companies began to adopt the natural sweetener to differentiate their products from the mainstream. 

Since then, the alternative sweetener industry has developed quickly in China—now the biggest stevia producer worldwide, according to Zenith International, the food and drink consultancy.

Noodle and beverage major Tingyi (Cayman Islands) and Uni-president China, the country’s biggest juice producer, are among the major local companies to have pioneered the use of stevia in their products. Yet despite the efforts of these and other major F&B companies, effective product and marketing strategies have left the segment lagging. 

As a result, Chinese stevia companies have until recently set their focus on low-cost manufacturing and mainly function as suppliers for crude stevia, rather than searching for higher margins and market value.

As a result, export volumes of stevia extract were the highest of all plant extracts from China in both 2015 and 2016. America and Malaysia feature as the main export destinations—the former accounting for more than one-third of total exports. Elsewhere, Korea, Japan and Mexico rank as other notable export destinations.

The global demand for alternative sweeteners including stevia has been growing rapidly, with Asia-Pacific becoming the biggest consumer, and accounting for more than half of the total demand.

The ex-works price of stevia has fallen considerably since 2015. In January that year, the market price for one tonne of RA95 stevia was listed at US$122,000, and then plummeted to US$73,000 in July Last year. 

According to CCM’s market monitoring, prices recovered slightly to US$77,300 per tonne by February 2017.

In spite of a lack of investment until now, manufacturers have begun to increase their spending to meet growing demand in the country and worldwide. One of these, Dongtai Nashengte, a subsidiary of Zhucheng Haotian, is planning a new production line with a capacity for 30,000 tonnes a year, according to CCM. 

However, there have been some incidents that have left a bitter taste for China’s stevia industry. Last year, America banned imports of Chinese sweeteners after accusing the segment of using forced labour in their production.

CCM now predicts that stevia production will expand substantially during the course of this year as manufacturers stake their claims to this growing market, especially as big customers such as Coca-Cola, Pepsi and Starbucks have been redoubling their focus on natural sweeteners like stevia.

Related topics Ingredients Soft drinks

Related news