Propelling growth: New ADM and Vland JV responds to Chinese probiotic demand

19 Oct 2021 --- ADM is targeting the growing Chinese market for human probiotics through a new joint venture (JV) with Qingdao Vland Biotech Group (Vland), a biotechnology company specializing in enzymes and probiotics.

“This JV represents the latest expansion in our full-scale global health and wellness business, which is helping propel growth across our entire human and animal nutrition portfolio,” says Vince Macciocchi, president of ADM’s Nutrition business.

The 50/50 joint venture will manufacture and sell human probiotics. It aims to bring together expertise from both ADM and Vland to encompass a full range of technology, production and commercial capabilities, from pre-clinical trial design and manufacturing to go-to-market strategy and execution.

Pending regulatory approval, the JV is expected to launch in the first half of 2022. Claims as percentage of F&B launches tracked with a digestive/gut health claim in Asia (Source: Innova Database).

Increasingly aware consumers
Aron Chen, CEO of Vland, explains that the partnership will use the technology, brand and sales channels of both parties. “It is perfectly positioned to expand production and meet demand for high-quality human probiotics in China and for global customers.”

Retail demand for probiotics in China is estimated to be US$1 billion in 2022, with annual growth of more than 9 percent, according to Macciocchi. 

“Consumers are becoming increasingly aware of the strong linkage between health of the gut microbiome and their overall health,” he continues. 

“We talk about the gut-skin axis and the gut-brain axis. People understand that things are happening in their guts, and if they take care of it, that has a positive impact on overall health,” Mark Lotsch, president of global health and wellness at ADM, recently told NutritionInsight at Vitafoods Europe 2021. 

He also sees increasing levels of education and consumer interest in clinical backing. 

Chinese demand on the rise
Innova Market Insights reports that digestive health food and beverage products are showing rapid growth in Asia. Notably, one in three consumers in this region report buying more drinking yogurt or fermented beverages since the outbreak of COVID-19. 

Additionally, consumers are becoming more aware with probiotics, with nearly 70% of Chinese, Indian and Indonesian consumers saying they are familiar. Additionally, over half say that they accept probiotics. 

The market researcher also notes that Digestive and Liver Health is the top positioning for probiotics launched in China between 2016 and 2020, followed by Children and Immune Health.

In May, Angel Nutritech launched probiotic drops and powder as an early intervention against infant allergies for the Chinese market. 

Other probiotic companies that previously strengthened their Chinese presence include Probi and DuPont Nutrition & Biosciences. 

The 50/50 joint venture will manufacture and sell human probiotics

Building on ADM’s growth
ADM flags that global demand is growing for ingredients and supplements that give consumers the power to support digestive health and immune function and elevate their general well-being. 

As a result, it has made several growth investments to build a full-scale global health and wellness business to meet this demand.

This includes acquisitions like the additions of Protexin and Biopolis, organic projects such as the significant expansion in probiotics production at its Valencia facility, and partnerships including a prior collaboration with Vland.

Discussing new areas for ADM to expand in, Marta Tortajada Serra, vice president of science and technology in health and wellness, explains that beauty, cognition and anxiety are set to be key themes for the gut health space. 

“We will also be getting more precise with complementary angles for solutions we already have for metabolic health. We can also possibly combine these with other ingredients in our pantry. For example, botanicals are already being used as signaling ingredients.”

By Katherine Durrell