October 25, 2011

CJ Cheiljedang to build lysine plant in US 

CJ, in collaboration with agricultural giant Cargill, is investing US$300 million in the US lysine market by establishing a plant in Iowa, the US, by the end of 2013, according to Reuters.

The plant will have an estimated output of 100,000 tonnes per annum.

The US lysine market, with last year's annual demand volume of 350,000 tonnes, is the world's third largest after Europe - 500,000 tonnes and China - 450,000 tonnes.

Lysine is an essential amino acid that cannot be synthesised in a human body. It promotes the physical growth of livestock, and reduces nitrogen emissions.

Cargill, the US's biggest grain company, will provide CJ with starch sweeteners needed for the lysine production. CJ will embark on the amino acid production for animal feeds from the end of 2013 upon completion of the plant construction. The current US lysine market is largely dominated by the US ADM and Japan's Ajinomoto, the two accounting for over 60% of the market last year. The entire output from the factories in Iowa will be sold in the US market.

The global lysine market is a US$3 billion industry, and it is led by China's GBT followed by CJ Cheiljedang, Ajinomoto, and ADM.

"CJ is expected to constitute the largest lysine producer when the factories in Shenyang and Iowa start operating," said a CJ official, "Shenyang and Iowa factories will start operation from the first half of 2012 and the end of 2013, respectively. We will have 30% of the market share once our capacity for the lysine production reaches 700,000 tonnes per annum by 2014."