Sales representative Cindy He estimates that Fenchem produces between 30 and 40 percent of all the phytosterols exported from China. Current Chinese production capacity is estimated to be around 450-500 metric tonnes.

The European market, where consumers remain largely opposed to genetic modification, accounts for 60 percent of Fenchem's sales. But more and more GMO soybean seed is being planted around the world and China is no exception: indigenous soybeans have declined since it opened up its market to imports from the US and Brazil to such an extent that it is believed there is virtually no indigenous soybean left in North China, one of the main production areas.

Fenchem received IP (identity preserved) certification for soy-derived natural vitamin E, phytosterols and isoflavones from Swiss third party testing group SGS in March 2005. It is thought to be one of the first to receive certification and this, He told NutraIngredients.com, combined with an aggressive marketing campaign and presence at as many as 10 trade shows throughout the world, has been instrumental to the phytosterols' success.

Because of the difficulty in sourcing raw material, IP phytosterols come in at around 20 percent higher than the market price. At 95 per cent purity they currently cost in the region of $17 per kg, compared to around $10-12 for the GM soy-derived product.

He said that while the quality is comparable to ingredients produced in the west, production costs are lower so it is able to offer them at a lower-than-market price.

These, she expects, will become leading products for the company behind phytosterols and vitamin E.

Fenchem is also planning to introduce a new product line in 2007, and is preparing for this with the construction of a dedicated US$3 million, 280,000 square foot new plant in Nanjing.

"The new production line will focus on fermentation and isolation," she said, but was unable to give more details due to patent arrangements yet to be finalized.

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