Asia-Pacific Lactic Acid Market - Growth, Trends, and Forecast (2018 - 2023)
The global lactic acid market has been valued at USD 3.1 billion in 2018 and is expected to reach USD 3.8 billion by 2023 witnessing a CAGR of 10.3% during the forecasted period of 2018–2023. Lactic acid is a popular acid used in the food industry. Lactic acid is an organic acid, which is considered as a weak acid by nature and can be obtained by the biochemical or chemical process. The biochemical process involves the bacterial fermentation of carbohydrates to produce lactic acid and is then purified to get the pure form. The chemical process involves the use of petrochemical substances, which are not sustainable and utilizes more energy, and has low demand.
Lactic acid is commercially available in various grades depending upon its purity. China and Japan are the major markets for lactic acid in the region. China is the largest exporter and producer of lactic acid in the Asian market and the second largest exporter worldwide.
The demand for lactic acid in the Asia-Pacific region is emerging fast with the rise in the application as a food additive. The major driver for the Asia-Pacific lactic acid market is the increase in demand for meat and other food applications of lactic acid, availability of cheap raw materials, innovation in technology, and strong support of big manufacturing companies in the region. The low cost of raw materials such as molasses, starch, sugarcane, and other carbohydrates for production has been a big advantage for industries, as it directly lowers the final cost of the product. Also, these raw materials are abundant and easily available in the domestic regions for production, which is driving the market. However, the high capital investment in production and purification technology are affecting the market. The volatility in the raw material cost is another factor which leads to increase in product price in the market.
The Asia-Pacific lactic acid market is classified into different segments by application, function, source, and geography. Market segmentation by application includes meat, poultry and fish, dairy, beverages, fruits and vegetables, bakery, and confectionery. Dairy and meat product applications have higher demand among others. The market segmentation by source consists of natural and synthetic source. The natural source type is further sub-segmented into milk or plant source. The natural production of lactic acid dominates the market while the synthetic production is less common, due to sustainability issues. Lactic acid market segmentation by function in food and beverage includes its function as a preservative, pH regulator, antimicrobial agent, flavor, and mineral fortification. Lactic acid is more commonly used as a pH regulator in various foods and as an antimicrobial agent in meat and poultry products.
The sustainable production of lactic acid, technological enhancement, and the involvement of major companies in the market has proven to be a big opportunity for the lactic acid market. The major competitors prefer investment in new product development, widening the application market, and marketing strategy due to volatility in commodity costs to maintain their position. Henan Jindan is the largest producer and exporter of lactic acid in China and Asia. The company uses the new membrane technology for the separation and purification process of lactic acid, which aids in the efficiency of production and reduces energy consumption.
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