Introduction
The global chitin, chitosan, and derivatives market is highly competitive with key industry players adopting various factors such as product portfolio, regional presence, strategic alliances, and industry experience. Most companies in the market are focused on expanding operations across regions, augmenting their capabilities and building strong partner relations. The growth of market players is dependent on market conditions, government support, and industry development. Thus, the vendors should focus on expanding geographically and improving product quality. ADVANCED BIOPOLYMERS AS, G.T.C. Bio Corporation, Golden-Shell Pharmaceutical Co. Ltd., Heppe Medical Chitosan GmbH, Kitozyme, LLC, Zhejiang Shinfuda Marine Biotechnology Corp, Meron Group, Primex EHF, Zhejiang Candorly Pharmaceutical Co., Ltd, and Panvo Organics Pvt Ltd are the major companies in this market, who compete based on market presence, quality, and price.
The key players are taking steps toward business expansions and market development, expanding their customer base. The international players may strengthen their presence worldwide through acquisitions during the review period. It has also been forecast that improvements in the global economic scenario and the growing chitin, chitosan, and derivatives industry in emerging nations would drive the market growth, making it an ideal time for players to launch new type of products and increase their global market shares.
Michael Porter’s Five Forces model offers a framework to study the global chitin, chitosan, and derivatives market. Strategic business managers, trying to gain an edge over competing firms in the global chitin, chitosan, and derivatives market, can utilize this model to better comprehend the industry in which the company operates. The components of each of the forces and the degree of impact of each element in the context of the global chitin, chitosan, and derivatives market have been broken down and analyzed.
THREAT OF NEW ENTRANTS
The global chitin, chitosan, and derivatives market is emerging to be lucrative owing to the rising demand for chitin and its derivatives in the various application industries. Additionally, growth of the application industries and widening application scope of chitin and its derivatives are also boosting the market growth. Chitin is a byproduct or is obtained from waste of shrimp or insect industries, thus, lowering the overall investment cost. Owing to such factors, the new entrants are expected to witness few entry barriers and high product demand. However, the presence of few established players and numerous local players in the global market is posing threat for the new entrants.
Hence, the threat of new entrants in the global chitin, chitosan, and derivatives market is expected to be moderate.
BARGAINING POWER OF SUPPLIERS
Suppliers in the global chitin, chitosan, and derivatives market are the livestock growers (insect) and feed manufacturers that supply the waste byproducts, microbiology/biotechnology labs, fisheries, and traders of crustaceans and insects. The global market comprises of several suppliers, resulting in abundant raw material availability. Manufacturers of chitin and its derivatives have the flexibility in opting for any raw material alternative, such as insects, crustaceans, and fungus, available in the market at low price and in large quantity. Owing to such determinants, the switching cost for the market players is low.
Hence, the bargaining power of suppliers in the global chitin, chitosan, and derivatives market is expected to be low.
BARGAINING POWER OF BUYERS
Buyers in the global chitin, chitosan, and derivatives market are the application industries in which chitin and its derivatives are used as an ingredient or raw material. The global chitin, chitosan, and derivatives market is a perfect competition market governed by numerous buyers and market players. However, production facilities of chitin and its derivatives are largely concentrated in Asia-Pacific, with negligible production in Europe. Thus, the buyers in Europe heavily rely on imports of chitin, chitosan, and derivatives.
Hence, the bargaining power of buyers in the global chitin, chitosan, and derivatives market is expected to be moderate.
THREAT OF SUBSTITUTES
Chitin and its derivatives are used in various application industries as a thickener, stabilizer, and emulsifier. Presence of various hydrocolloids of both natural and synthetic origin pose a threat to the demand for chitin, chitosan, and derivatives. Gelatin, bentonite, and isinglass are being used in the application industries as an effective substitute of chitin and chitosan. However, there are certain drawbacks of using gelatin, especially in wine making, due to which chitin and its derivatives gained demand in different applications. Moreover, chitin is biodegradable and of natural origin, resulting in increasing preference for chitin and its derivatives.
Hence, the threat of substitutes in the global chitin, chitosan, and derivatives market is expected to be moderate.
INTENSITY OF RIVALRY
The global chitin, chitosan, and derivatives market is marked by a high intensity of rivalry due to the presence of numerous local and global players. The established players in the market are targeting competitors in terms of quality, price, and product differentiation, thus making the industry competitive. Market players are investing in their R&D and adopting new technologies to produce chitin and its derivatives to achieve high yield at low production cost.
Hence, the intensity of rivalry in the global chitin, chitosan, and derivatives market is expected to be high.
