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I. Abstract

Biotechnology is widely and deeply being applied in the food industry, driving a revolution in the food industry. Using genetic engineering as the core, including cell engineering, enzyme engineering and fermentation engineering, has progressively formed into a new food biotechnology. Currently, Taiwan's food biotech industry has gradually gone from producing mainly monosodium glutamate to the development and production of health foods. However, the development of health food today has shifted towards conventional fermentation and manufacturing, which has a lower technical level but greater competitive pressure as well. The industry should pursue high technical standards and patent protection in order to be profitable. Food use functional peptide is a new field that is waiting to be developed. The market potential for this product is quite large, but its technical requirements are very high, thus making it a high tech industry that is suitable for the domestic food industry to invest in. The building of a platform for gene expression, development of special peptide decomposing enzymes, and design of functional peptide genes, are the key technology for this industry. In addition, the production of functional and nutritional peptide is beneficial to the development of Taiwan's farm villages because the materials it uses are the waste from agricultural, fishing, and ranching products, such as rice chaff, pig blood, milk, and protein from beans. If this industry can be promoted in Taiwan, it will greatly help agricultural products' high usage and enhancing its added value. Moreover, if the functional and nutritional peptide genes that are developed is suitable for the gene transformation of plants, then it can be transformed to agricultural products, producing functional agricultural products, such as rice that can reduce blood fat, tomatoes that can reduce blood pressure, so that Taiwan's agricultural products can become even more diverse and globally competitive.

II. Industry Definition and Scope

The food biotech industry refers to all related industries or food processing industries that use biotechnology production methods, i.e. includes using genetic engineering, cell engineering, enzyme engineering, and fermentation engineering to improve the quality of food or ingredients, enhance production, or reduce costs, etc. For example, using genetic engineering to produce special enzymes or high added value products such as functional peptide; using cell engineering to produce special food scents or flavor additives; using enzyme engineering to change the food's quality and nutritional vales, e.g. protein that has undergone special enzyme hydrolysis treatment can enhance its digestion. In addition, carbohydrates hydrolysis amylase can produce glucose monosaccharide or low polysaccharide. Meanwhile, fermentation engineering uses modern day fermentation engineering to re-create traditional fermentation foods, using microorganism flora for fermenting to enhance ingredient utilization and shorten the fermentation period needed for flavor improvement.

III. Industry Overview

The main food biotech applied in the industry today in Taiwan includes: (1) Enzymes: can be divided into industrial use and food use enzymes, import amount worth roughly NT$1 billion, production amount of approximately NT$100 million. (2) Amino acid: mainly monosodium glutamate, production amount at about NT$5 billion. (3) Health foods: e.g. lactic acid bacteria, chitin, health consumption mushrooms, anka (aka koji), etc. Several domestic manufacturers have already begun to develop the ingredients for these health foods, such as Taiwan Sugar Corp. (cordyceps[winter worm summer grass]), Grape King Inc. (ganoderma, antrodia camphorata, cordyceps[winter worm summer grass]), Tah Chwen Food Co., Ltd. (cordyceps[winter worm summer grass]), Kong Yen Foods Co., Ltd. (cordyceps[winter worm summer grass], active enzymes), as well as chitin has already become an important biotech industry in Taiwan. It is used mainly in health foods and followed by agriculture. Sales volume is around NT$3.5 billion and mostly imported from Europe, the U.S., and Japan.

IV. Industry Analysis

In 2002, the worldwide enzyme market for food and animal feed use amount to roughly US$1.176 billion, representing an annual growth of about 11.4%. The world's main suppliers of enzymes were Denmark (55%), the U.S. (25%), and Japan (5%). Currently, the enzyme use market has gradually saturated (e.g. starch and sugar industry). In the baking industry, there has been an increasing trend for alpha-amylase, lipase, and xylanase. Enzymes still have a huge development potential in the health food market.

Today, the worldwide market value for health foods has exceeded US$30 billion, with the U.S. and Japan as the major countries. Digestion related health foods are most popular in Europe, especially probiotics. Other popular products include anti-oxidation related products and products that are good for the heart and blood vessels (such as soybean lecithin, DHA, EPA, anthocyanins). In the U.S., vitamins are the most popular, especially anti cancer products and botanical medicines. As for digestion related health products, the market for milk products made from probiotics still has a lot of room for development. Of Japan's certified specific usage health foods, 71% are related with improving digestion functions (lactic acid bacteria, fiber, oligosaccharide). In addition, there are also products related with blood pressure (polypeptide, glucoside), mineral related (hemoglobin iron, oligosaccharide, CCP, CCM), and cholesterol related (soybean protein, fiber).

Japan has always taken the leading role in the R&D and application of functional foods. As of 1999, 167 functional foods have already been approved. Of this, oligosaccharide group, lactic acid bacteria and dietary fiber account for 80%. There are also 13 protein and peptide products, which can help reduce blood fat and blood pressure. Table One is the production value of Japan's health food ingredients during 1999. In 1998, the scale of Japan's health food market reached Y720 billion, but compared with 1997, it was negative growth. The main reason for this was because there was no hot health products marketed at that time and low segmentation on the product's production techniques. Since marketing is the key success factor, most products only use counter pricing marketing methods. Presently, R&D is headed toward high functionality high technology segmentation. Functional and nutritional peptide belongs to this category of products. In recent years, the market growth rate for peptide products has grown swiftly. If Japan's market scale is used to estimate the future of Taiwan's peptide functional foods market. The reducing blood pressure and blood fat peptide market can reach NT$4 billion, while nutritional peptide products can achieve NT$3.7 billion. When using enzymes to produce peptide products, the cost of the enzymes account for more than 30%. How to reduce enzyme costs has become an important topic for discussion.

Peptide can be used as strengthening nutritional food because it contains 2 - 4 amino acid residue peptide, which is easier for the body to absorb than free amino acids peptide often can adjust the body's physiological functions such as lowering blood pressure and blood fat peptide will play a very important role in the future health food market. The mass usage of peptide today is limited to nutritional peptide used in the animal feed level. The way it is produced is by using enzymes to hydrolysis the by products of ranch animals. This type of peptide animal feed mixes in various non- peptide ingredients, thereby containing low levels of functional peptide. The product's main appeal is its high-density nutrition and cheap unit price (Table Two). If the functional peptide that it contains can be increased and the mixed particles within peptide can be removed, then it can become a food level functional and nutritional peptide product, enhancing the added value of agricultural products.

Table One: Production Value of Japan's Health Food Ingredients (1999)

Item Production Value
 (Yen billion)
  Item Production Value
 (Yen billion)
Vitamin C 480 Amyda sinensis 5.0
Calcium 400 Grape seed 5.0
Chlorella 400 Kale 5.0
Royal Jelly 400 Monkey head mushroom 4.0
Food fiber 400 Gymne mushroom vesta 4.0
Vitamin E 350 Blueberry 4.0
Protein 180 Champignon 4.0
Prune 180 Plantaginis herba 4.0
Multi-Vitamin 180 Egg york phopholipid 4.0
Korean ginseng 180 Health vinegar 4.0
Spirulina 140 Oyster part 4.0
Bifidus 120 Γ-Linolenic Acid 3.0
Aloe 120 Glucosamine 3.0
Chitosan 120 Tangle's radix 3.0
Propolis 120 Shisonin 3.0
Folium ginkgo 100 Animal, fishery ossein 2.0
Garcinia 100 Kumasasa 2.0
Ganoderma 100 Epa 2.0
Nucleic acids 100 Sweet tea 2.0
Enzymes 90 Magnesium 2.0
Vitamin B group 80 Cyperus malaccensis 2.0
Carotene 70 Ciwujia ginseng 2.0
Garlic 70 Selen 2.0
Serenoa repens 60 Catechin 2.0
Barley green essence 60 Β-sitosterol 2.0
Plancenta extract 60 Sesame 2.0
Lentinus edodes mycelium 60 Corbicula clam 2.0
DHA 60 Mushroom extract 2.0
Squalene 60 Anka(aka koji) 1.0
Lecithin 60 Zinc 10
Iron 60 Monokheiya 10
Aromatic turmeric 60 Cordyceps(winter worm summer grass) 10
Yeast 60 Denthersteraptera(evening primrose oil) 10
Agarics 50 Eucommia ulmoides oliver 10
Plum extract 50 Seaweed 10
Pine bark extract 10 Guava 5
Heterologous Linoeic Acid 10 Jobstears/adlay 5
Soybean Isoflavone 10 Pollen 5
Oligossaccharide 10 Scallions 5
Kendyr 5 Pumpkin seeds 5
Tenchi ginseng 5 Vitamin A 5
Amino acid 5 Soybean Saponin 5

 

表二、胜肽相關產品成分及價格分析

Item %Dried TN
(%)
Soluble dissolubleTN
(%)
Unit Price
(NT$/kg)
Description
Peptide soybean meal
(Food industry research institute)
92.91 9.0 5.17 15-16 Target feedstuff products
Internal peptide soybeans meal(Hui shung) 90.07 8.1 0.43 22 Pao Su Chien
External peptide soybeans meal(Alltech) 90.11 ? 4.84 118 UP-1672
Import fishmeal 82.8 11.14 3.02 25-30 Fish meal
Uncooked soybeans meal
Soy protein
90 10.4 0.47 8-9 Soy meal
Yellow soybean peptide 90 13.7 1.78 80-100 Soy protein iosolate.
special flour 91.92 13.4 11.62 150-250 Use for human nutrition

(Data source: Dr. C.C. Cheng, Food Industrial Development Research Department )

V. Technical Analysis

  Due to the advancement in biotechnology, many types of food have been found to be effective in preventing or slowing down diseases. Moreover, with the large increase in demand for health food by Taiwanese consumers, the types of health food have also increased and become diversified. However, because of its low technical barrier, market competition is fierce. Currently, the health food market is almost fully saturated. The industry has demanded higher standards of technology as well as patent protection in order to achieve profitability. Therefore, most domestic manufacturers hope to invest more into high level research to obtain patent rights. Today, the main technology among domestic food biotechnology still relies on traditional fermentation and production procedures. Utilizing gene engineering technology to improve microorganism or produce useful products is still in the R&D stage.

Therefore, Taiwan should aggressively utilize biological information, discover the heredity resources hidden in the genes, develop new techniques and products, strengthen research on food industry use microorganism genes, create protein, enzyme, and high-throughput screening production platform as well as various GRAS microorganism's heterologous protein production platform. Furthermore, make in-depth assessments on the niches of the domestic biotech industry, shrink the range of research, concentrate resources, and invest in innovative and industry beneficial research topics, such as functional peptide products.

In terms of the industry environment, coordination should be carried out between upstream, mid-stream, and downstream R&D in addition to the vertical integration of the industry. Coordination should also be carried out between the industry, government, academia, and research fields, concentrating R&D resources to create opportunities for breakthroughs in R&D. Appropriate more budget and R&D talent to support the establishment of various fair and reasonable technology, encourage R&D personnel to attend international seminars, and enhance the visibility of individual's innovative inventions.

VI. Composite Analysis

  SWOT analysis of the food biotech industry's competitiveness is as follows:

Strength Weakness

* Both gene and enzyme engineering techniques are already quite mature.

* Has already initially controlled the key enzyme to produce peptide.

* Taiwan already has the production technology for producing delicious and aromatic peptide.

* Biological active analysis techniques are quite mature.

* Insufficient R&D investment by the industry.

* Lack of innovativeness within the academic and industry fields.

* Food enzymes completely rely on imports.

* Lack of experience in producing and blending functional peptide.

* Serious lack of high speed screening facilities for the enzyme artificial evolution.

Opportunity Threat

* Gene decoding provides opportunities to develop new types of enzymes.

*  Taiwan has already established new techniques for the enzyme artificial evolution.

*  Abundance of material in Taiwan to produce functional peptide.

* Strong competitiveness of Japan and China's food biotech industry.

*  Lack of control on leaking Taiwan's technology and information to China.

*  Europe and the U.S. have complete technical experience and patent protection.

 

VII. Current State of Industry Policy

(1) Current State of Industry Problems:

The main problem regarding the development of the food biotech industry in Taiwan is because for years, the focus of research within academia has been concentrated on developing key technology and products for medical medicines, very little has been invested in food biotechnology. Therefore, there is very little original and innovative biotech technology or products that can be transferred to the industry. Moreover, the industry lacks investing in R&D as well while also in a rush to transform. As such, many businesses have invested in health food, creating overlap in products and vicious competition, which is not beneficial to the development of the food biotech industry. The industry lacks original and innovative technology and products to create a competitive edge, which can increase profits and enhance competitiveness against foreign manufacturers. There is also a serious lack of senior R&D talent in the industry, which makes it difficult to implement the research results from the academic field.

(2) Consultation strategy:

Regarding the lack of senior R&D talent, in addition to strengthening the cultivation of new talent, the number of different research topics should also be reduced as well. Key technology and products that are original and innovative should be carefully selected and carried out through integration or by collaboration between the industry and academia. Academia should assist the industry to build up key platform technologies to support the industry's R&D capability. Related government departments should seek opportunities to work on international projects, encouraging foreign companies to set up R&D and production sites in Taiwan.

(3) Review of current policies:

Food biotechnology in Taiwan is mainly driven by the National Science Council (NSC), Council of Agriculture, Ministry of Economic Affairs (MOEA) and the Department of Health (DOH). The NSC has not listed it as a national technology project, while the DOH focuses mainly on the regulation and testing of GMO food products and the MOEA emphasizes the preservation of microorganism and development of functional food, such as natural antioxidant materials, gluten peptide, bifidobacterium, r-GABA, ε-(r-glutamyl) lysine and nutritional peptide in animal feed. The subject for R&D does not involve food nutrition and functional peptide; hence it can be listed as an important promotion item for this Council. In addition, the expression platform for GRAS microorganism genes has yet to be set up in Taiwan. This type of gene platform technology plays a key role in the production of food industrial use functional peptide and special enzymes.

 
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