Demand for an alternative glucosamine supply in Europe, which restricts much of the material being produced in China and is suffering from a shortage of raw material production elsewhere, prompted Cargill to apply for novel foods approval earlier than planned.
Use of the naturally occurring amino sugar that has been shown to reduce pain and inflammation in arthritic joints has been growing steadily over recent years, but the ingredient is subject to significant flux in supply of the main raw material, shrimp.
Prices are currently soaring as shrimp producers in the main producer countries, such as India, Vietnam and China, are faced with US anti-dumping duties that would halve shrimp meat prices. Also facing high diesel prices, producers of shrimp have stopped fishing in many regions, seriously impacting supply of the glucosamine raw material.
Cargill's Regenasure is a glucosamine hydrochloride derived from the fungus Aspergillus niger. It has been declared substantially equivalent under the EU's novel foods regulation to that derived from shellfish but its 'shellfish-free' status will be a major USP as allergen labelling tightens up in the US and Europe.
It is also vegetarian and Kosher, offering supplement makers significant areas of differentiation.
"We're not looking to take over the market. People will still want to use the shellfish material that has a significant cost advantage. But the majority of producers in the market want to have an alternative supply and the chance to differentiate their product offering," explained Tim Bauer, director of sales at Cargill Acidulants.
The division makes the ingredient through a proprietary fermentation process at its Eddysville plant, where it spent around $15 million scaling up the plant.
Launched about 10 months ago and the only glucosamine being produced in the US, it is now available in dietary supplements offered by "about 12-20 mid-size customers", including Canada's Jamieson Laboratories and Now Foods. The big manufacturers are expected to introduce new products formulated with Regenasure in the next quarter.
The ingredient is also approved in Japan under the FOSHU system, although Bauer says that stronger than expected demand from Japan and the UK speeded up Cargill's entry into these markets.
"The EU has banned lots of other products. This is one of the reasons we drove to get approval there. Major brands in Europe already have the material in their hands and are formulating with it. They are just waiting official approval before they launch new products," said Bauer.
Up to 6,000 metric tons of glucosamine are consumed annually around the world, much of which is in the US where it is worth about $900 million on the retail market, said Bauer. The UK probably makes 10 per cent of these sales.
And while glucosamine in the US has been as low as $4 per kg earlier this year, it recently hit a high of $17, making Regenasure more competitive at between $20-26 per kg.
"The long-term market needs an alternative supply. Globally there have been shellfish shortages for some time but it has come to light faster than anticipated. We're not going to make a big ripple in the current market - from the beginning we recognized that this was already well established," he added.
Instead the ingredient could provide room for new applications and delivery systems. Monarch Beverages in Canada has launched a sports drink containing the product, which is said to be 'extremely soluble'. Other companies in the US are still waiting for GRAS but the ingredient could get a major boost from the food market.
"Most major food and beverage producers won't put shellfish products into their foods, it is one of the top eight allergens," continued Bauer.
Cargill has commissioned a trial for the end of the year to demonstrate the ingredient's efficacy. "We are probably one of the only manufacturers doing a trial."
There could eventurally be other companies making glucosamine through a similar process but for the moment, Cargill seems to have a headstart with its shellfish-free variant.
The UK's Advisory Committee on Novel Foods and Processes (ACNFP) is calling for comments on its draft opinion by 31 July 2004. If it receives no objections, under the 'substantial equivalence' clause of the novel foods regulation, Cargill will merely need to notify the European Commission of its intention to market the product in the region before companies can launch new Regenasure-based supplements.