Global Market Outlook on Chondroitin Sulfate

  • Global production: Global production capacity for CS is 15,000 MT, while the operating capacity is 14,184 MT in 2018
  • Producing Regions: China accounts for 83.69 percent of CS produced globally.
  • Production by Type: Bovine CS accounts for approx. 35–45 percent of all CS produced globally. Other major types include Porcine (approx. 25–30 percent), Piscine (approx. 15–20 percent), and Avine (approx. 15–20 percent)
  • Demand: Demand is projected to rise by 3 percent CAGR in the next four years. Dietary supplements constitute the bulk of global demand, due to its application in osteoarthritis
  • Cost Structure: Raw material is the major cost component with all four types (Bovine, Porcine, Piscine, and Avine), accounting for 70–80 percent of the total cost in China. Total input cost for 99.5 percent purity vary between USD 20/kg and USD 25/kg in China, depending on the raw material used
  • Pricing Analysis: The 2018 price in China for orders of >10 MT is estimated at USD 41,600/MT. The combined average price of CS is USD 51,600/MT for 2018 (higher by USD 10,000). Since current capacities can meet the projected demand growth, the average price is projected to remain at similar levels to that of 2018, with a marginal upward movement of 2 percent until 2021
  • Supply Chain Structure: None of the CS manufacturers have vertical integration for full supply chain. Cartilaginous tissues come from other suppliers, such as animal farms, slaughter houses, fish-farms, and meat processors
  • Major Global Suppliers: Pacific Rainbow (China), Sanxin (China), Nippon Zoki (Japan/Vietnam), WanTuMing Biological (China), TSI Group (US/China), Yantai Dongcheng (China), Focus Chem (China), YBCC (US/China), Runxin Biotechnology (China), Huiwen (China), QJB China (China), Meitek (US/China), Hengjie Biopharmaceuticals (China), and Summit Nutritionals (US)

Global Production Share by Country (2018)

  • CS production is concentrated in China, with over 200 manufacturers
  • 60 percent of Chinese exports are to the US, primarily food grade; while EU exports are of pharmaceutical grade
  • China is a major region for animal husbandry, with access to cheap competitive raw materials
  • The easy access to raw materials is a major factor driving Chinese supply and market growth

Global Market Dynamics: Demand

Category Insight: Demand is projected to rise by 3 percent CAGR in the next four years, which would be met by the current production capacity and raw material availability.

  • Overall growth of CS demand is approx. 3 percent per annum
  • The prevalence of osteoporosis and health benefits of CS are the primary demand drivers
  • Demand for anti-aging products has risen during the last 10 years in the EU and North America

CS consumption by the veterinary sector was approx. 20 percent a decade ago, but has come down, due to diversion toward human diet and pharma related applications

  • The dietary supplements segment constitutes the bulk of global demand for CS, due to its application in osteoarthritis
  • Demand is driven by prevalence of osteoarthritis in many regions, health awareness, and introduction of novel CS combination products
  • The US, UK, and Germany are leaders in terms of CS demand for health benefits against osteoarthritis
  • Demand for bovine CS can increase in emerging markets (India and Brazil), in addition to China, thus driving global demand
  • Market shares for end-use sectors in the EU are 43.8 percent for dietary supplements, 27.2 percent for pharmaceutical, 19.2 percent for cosmetics, and 9.8 percent for veterinary and other sectors

Global End-use Applications: Raw Material and Regional Trends

  • Bovine CS is the fastest growing type, and could rise by a CAGR of 3-4 percent by 2025
  • There is greater demand for shark-derived CS, whereas the US and Australian markets prefer bovine-derived product
  • Consumer preference toward the bovine source is due to religious factors; limiting porcine use. Environmental factors limit the use of shark source
  • Ban on porcine-based CS in the Middle East could further drive the bovine segment
  • Potential contamination of bovine CS by bovine Spongiform Encephalopathy (Mad Cow Disease) could drive the porcine segment as well