The world’s factory: Breaking down China’s tradition and expertise in mushrooms and botanicals
China is one of the world’s leaders in manufacturing, creating anything from botanicals, herbs, and vitamins to pharmaceuticals, electronics, and textiles. Although conversations on Chinese products often focus on quality and cost, industry experts believe the country sets the standard in mushrooms and herbal ingredients — where producers offer operational excellence, geo-authentic sourcing, and processing know-how based on the country’s agricultural and processing history stretching thousands of years.
In this first installment of our two-part series, Nutrition Insight dives into China’s agricultural, historical, and processing expertise with organic mushroom extract provider Nammex and Nuherbs, which specializes in Chinese herbs and herbal remedies. Both US-based companies exclusively source their ingredients from China.
“We sell everything from the most ancient form, such as dried herbs and powders, to something as complex as a biochemical extract,” says Wilson Lau, president of Nuherbs. “What China does better than anyone else is tying that supply chain together to deliver either an ingredient or a finished product.”
“That’s why they’re the world’s factory. It’s not because they have the cheapest labor, but they have all the pieces to make it happen quickly.”
He details that China has “operational excellence lacking anywhere else in the world” because, for the last 30 years, the country’s industry has been refining its manufacturing capabilities to transform raw materials into finished products and ingredients.
According to Lau, other countries may make similar products, but they lack the equipment, know-how, packaging facilities, and logistics to produce and ship them quickly.
He adds that because China is doing so much manufacturing, it can depreciate the plants faster than anywhere else in the world. “The plants I’m using are getting upgraded every three, four, or five years. And in the US, some factories were built in 1960, and they still work.”
Skye Chilton, CEO of Nammex, agrees: “If you look at the vertical integration and the speed of change too, and how rapidly they can put things together. When we travel there, you see how immensely everything has changed over the decades.”
He adds that China has the knowledge and scale in low-tech farming and high-tech processing, and the history, as agriculture is ingrained in the country’s culture.
Chilton says that China has a long history of growing and processing mushrooms, with the most mushroom specialists worldwide.Geo-authentic region
Chilton says that China has a long history of cultivating and using mushrooms.
“You have traditional Chinese medicine, 800 years of cultivation, and more mushroom scientists than any other place in the world. It’s a top-five agricultural crop for them. So certainly, there’s the scale level, and then you have the knowledge base.”
The country grows over 90% of the world’s mushrooms. Although it is possible to grow mushrooms anywhere with the right equipment and knowledge, Chilton says such products likely will not reach the right price point.
Lau highlights that his company’s wild-collected botanicals from China are “very specific to the geo-authentic regions and areas that we want to grow and collect from.”
“Herbal medicine is not a single phytochemical constituent, and the higher you increase the purity of that phytochemical constituent, the more it becomes like a drug. It’s whole plant medicine; you need the whole plant.”
Herbs grown in other places may be very similar or different to what Nuherbs sources from China. “Because of how complex the chemistry in each plant is, we can’t judge whether it’s better or worse, but we know what we’re getting when we go to the geo-authentic region. Time has told us that if we get it from here, it will work a certain way.”
“We don’t know if it’ll work the same way if we get it from somewhere else,” he says, adding that determining this could take millions of dollars in testing.
Lau also points to the Nagoya protocol, saying that plant intellectual property connected to the plants and seeds the country grows “belongs in China.”
Lau highlights that his company’s wild-collected botanicals from China are specific to the country’s geo-authentic regions.Quality reputation
At the same time, products from China suffer from a reputation for being low-quality, adulterated, or contaminated. However, the experts highlight that China produces both low-tech, low-quality, cheap products and high-tech, top-range products, such as smartphones and TVs.
“There’s a whole spectrum of product and quality,” says Chilton.
He adds that many ingredients used in supplements and pharmaceuticals are sourced from China. “People aren’t questioning the most basic stuff they take daily in their multivitamins.”
Bill Chioffi, COO of Nammex, asks: “If you’re going to make a broad, sweeping statement about everything coming from China being of low quality, how well do you know your supplement market across the globe? Because in North America, almost 80% of those ingredients, labels, caps, bottles, and seals come from China.”
He says that China is the only commercially viable source of vitamin D3 and vitamin C.
“To make broad, sweeping generalized statements would be the same as saying anything that comes out of New Jersey is tainted with chemicals because there’s an association of cities being polluted. But China is also a vast countryside with untouched areas where human feet haven’t properly been down.”
The experts argue that producers in any country can create low-quality products or face recalls due to contaminated products.
Chilton highlights: “It doesn’t matter where it’s located. You can not follow procedures anywhere, and mistakes happen everywhere, too. That’s why you have quality procedures in place to try and catch this stuff, to know your risk points during your manufacturing process, so you’re mitigating that risk. Bringing it down to the lowest percentage point that’s possible.”
Chioffi says that China is the only commercially viable source of vitamin D3 and vitamin C.Process intellectual property
In addition to having geo-authenticity, Lau and Chilton highlight China’s processing know-how and dedicated research institutes stemming from traditional knowledge. The country also strongly focuses on science, technology, engineering, and mathematics in its education system.
Lau says the country has intellectual property based on manufacturing processes.
“You can buy the equipment and build a plant somewhere else, but you don’t have the technical know-how.” He says it’s easy to buy the equipment, but using it efficiently and tweaking the settings, is a different type of question.
He links this know-how and skill to the country’s history of being the world’s manufacturing hub: “It’s just like anything else that you do in life; you get your 10,000 practice swings in and learn how to hit the ball. To some degree, you will be better than the person who took ten swings.”
Chilton adds that the expertise also benefits from the country’s agricultural history.
“It’s a snowball effect. Traditional herbs have been around for thousands of years; mushrooms are similar,” he says.
China produces both low-tech, low-quality, cheap products and high-tech, top-range products, such as smartphones and TVs.Building on history and expertise
According to Chilton, informing consumers of China’s history, expertise, and specialty is essential.
“Consumers want a high-quality product,” he says. “I think they’re demanding because of low-quality ingredients; they want to know that there’s traceability there. They want to know that there’s transparency and they can see where products come from. And I think it’s important to tell that story as well.”
“The amount of history there is absolutely amazing,” he adds. “It’s a beautiful story.”
He points to the country’s agricultural history, multi-generational growers, and special growing techniques.
“There’s tradition there, and there’s specialty. Consumers want to know that they love storytelling, which gets them bought into that process,” says Chilton.
“For us, giving that sort of info to our customers and helping them tell that story too is important. That’s what we’ve been doing; how can we open this up, showcase it, and embrace it instead of hiding from it? It’s beautiful, I love going over there.”
