Ginseng Research Papers
Ginseng is being distributed in 35 countries around the world and there are differences by each country in the distribution volume and amount. However, since there is no accurate statistics on production and distribution amount by each country, it is very difficult to predict the world ginseng market. Ginseng trading companies and governments are in desperate need of comprehensive data that shows the world ginseng market status for sales and marketing. For that reason, this study will look into the approximate size of the world ginseng market based on recent ginseng distribution amount by each country and production by major ginseng producing nations. In addition, the review sets an opportunity to check the status of ginseng (Korea) in the world and presents future direction by examining recent history of ginseng development in Korea, which is one of the world’s largest ginseng distributers. Since ginseng is cultivated in limited areas due to its growth characteristics, ginseng distributing countries can be divided based on whether they grow it domestically or not. In general, four countries including South Korea, China, Canada, and the US are the biggest producers and their total production of fresh ginseng is approximately 79,769 tons which is more than 99% of 80,080 tons, the total ginseng production around the world. Ginseng is distributed to different countries in various forms such as fresh ginseng, dried ginseng, boiled and dried ginseng (Taekuksam), red ginseng and the related products, etc. and is consumed as food, dietary supplements, functional food, medical supplies, etc. Also, the world ginseng market including ginseng root and the processed products, is estimated to be worth $2,084 million. In particular, the size of the Korean market is $1,140 million which makes Korea the largest distributer in the world. Since the interests in alternative medicine and healthy food is increasing globally, the consumer market of ginseng with many features and the processed products are expected to expand continuously.
Keywords: Panax ginseng, Ginseng distribution, Ginseng market, Ginseng production, Red ginseng
The history of the use of ginseng began 4,500 years ago, and its first record was written 2,000 years ago. Ginseng has been one of the most important trade goods for health care and treatment of diseases in Asia including Korea and China, and is currently distributed to 35 countries around the world. Depending on the characteristics of each nation’s consumers, ginseng can be used for agricultural products, food, dietary supplements, health supplements, and medicines, etc. After international quality standards of ginseng in Asia as standards had been established in 2009 Codex Alimentarius Commission, the worldwide specification of ginseng gradually replaced each nation’s previous specification of ginseng. However, because there is no comprehensive statistical data about the ginseng production and the market size in the world, companies interested in ginseng business and marketing have difficulty entering ginseng market and expanding business.
In this situation, we would like to introduce ginseng market trend in South Korea which has the world’s largest distribution and estimate the world ginseng market size based on the best guess of ginseng production in countries such as China, Korea, Canada, and the US. We are afraid to say that there might be some discrepancies between the data from the report and the real data. But this report can be useful in overviewing the present and the future of ginseng industry schematically.
SIZE OF GINSENG PRODUCTION IN THE WORLD
Due to its growth characteristics, ginseng needs specific climate and soil conditions and is cultivated in countries such as South Korea, China, US, Canada, etc. Since there are no accurate official statistics on the annual production by each country, and the accurate statistics is hardly available, site-visit-consultation and statistical data from some countries are probably the only references at the moment. Though not clear, it is still thought to be tremendously helpful having international perspectives and senses on ginseng. The following Table 1 shows the estimated worldwide ginseng production.
Estimated worldwide ginseng production (based on fresh ginseng)
Looking at the world ginseng production, it can be roughly estimated as shown below. China has the most production, 44,749 tons, and it is estimated in the order of South Korea, 27,480 tons, ranking the 2nd, Canada 6,486 tons, the 3rd and the US 1,054 tons, etc. The total production by these four countries is 79,769 tons, which is approximately 99% of the world ginseng production (80,080 tons). Therefore, it is possible to say that they are responsible for the majority of the world ginseng production [1-3].
Every ginseng from of South Korea is Panax ginseng Meyer 1st class, and three types are produced by China, P. ginseng Meyer, P. quinuefolius L. and P. notoginseng Burkill. In Canada and the US, mostly P. quinuefolius L is produced. Based on production by species, P. ginseng Meyer is produced the most, and P. quinuefolius L. and P. notoginseng Burkill in the decreasing order. Particularly, it can be seen that P. ginseng Meyer shows the absolute dominance in the entire production (Fig. 1). Regarding ginseng production, while cultivation is done around 4 to 6 years roots in South Korea and China, 3 to 4 years root is usually featured and some of 6 years root are cultivated in Canada and the US.
Ginseng cultivation distribution and species and characteristics of ginseng.
SIZE OF THE WORLD GINSENG DISTRIBUTION
Ginseng is distributed in about 35 countries around the world as shown below. Among them, 19 countries including South Korea, China, etc. are both importers and exporters. However, North Korea is only exporter, and the last 15 countries are only importers. The imported size data of Syrian Arab Republic is not available.
Looking at the characteristics of these three types of countries, ginseng distribution is rather active in those countries which import and export at the same time and especially, the largest 4 producers, South Korea, China, Canada, US belong to them. On the other hand, the assumption is that North Korea with small production only export and that the countries without domestic production only import. In terms of ginseng root, Hong Kong is the biggest importer ($107 million in 2009). However, considering Hong Kong is the country where ginseng is not cultivated and not vastly consumed, it is fair to say that most of the ginseng is processed and then exported to other countries. On the other hand, Canada is the biggest exporter in the world ($66 million in 2009). They have sizeable export volumes in comparison to their production, and it seems as though most of the production is exported and only a little is consumed domestically. China is the biggest producer in the world. They also export and consume domestically; in fact they are the second largest in terms of the distribution amount (Tables 2-4).
Estimated worldwide ginseng distribution amount (based on ginseng root )
Estimated worldwide ginseng root distribution amount (As of 2009, $ 1000)
Then, where is the largest market in the world in terms of distribution amount? It is none other than South Korea. As of 2009, its annual production is 27,480 tons, the 2nd largest in the world, and it is the world’s largest distribution market. Its domestic distribution size is approximately $649 million in terms of the amount based on ginseng root (Table 2) and approximately, $1,140 million if including processed products (Table 3).
Estimated worldwide ginseng distribution amount (based on ginseng root + processed goods)
South Korea exports as well (2009, $38 million), but its domestic consumption is larger than the amount exported. In particular, the reason why the distribution amount is large in South Korea is that 100% ginseng root and a variety of processed products are thriving. In addition, ginseng products are divided according to distribution characteristics, and a wide variety of distribution channels such as department stores, road shops, large retailers, supermarkets, duty-free shops, drugstores, traditional markets, home shopping, internet sales, door-to-door sales, etc. are open. Also, if there is South Korea’s own unique distribution market, it is none other than the fresh ginseng distribution market. Fresh ginseng out in the field is distributed through the traditional markets etc. and is used as ingredient in various forms at home and restaurants. Ginseng in South Korea is mostly (estimated more than 90%) distributed as food.
In terms of ginseng root (fresh ginseng, processed white ginseng, red ginseng, and Taekuksam), production amount and distribution size of ginseng being distributed around the world are estimated to be approximately $1,130 million and if its processed goods (powder, capsule, extract, drink, etc.) are included, it can be estimated to be approximately $ 2,085 million (Table 3).
WORLDWIDE GINSENG CONSUMPTION PATTERN
Ginseng is being consumed in various forms depending on the nature of consumer culture in each country.
Asian countries such as South Korea and China have a long history of ginseng consumption that goes back as far as 1,000 years. Looking at the consumption pattern by each country, while ginseng root product is the mainstream in China and Taiwan, it is consumed in the form of solid type such as capsule, tablet, etc. and tonic nutrition beverage in addition to ginseng root product in Canada, US, Japan, etc.
On the other hand, in the case of South Korea, the world’s strongest ginseng distribution market, a wide variety of products are being consumed to the extent that it is no exaggeration to say any kind of ginseng product can be found in South Korea.
In South Korea, ginseng root is consumed and distributed in 4 types. The first is fresh ginseng right out of the field, the second is processed white ginseng which is dried ginseng, the third is Taekuksam which is the fresh ginseng blanched in the water dried, and the fourth is red ginseng which is steamed fresh ginseng with vapor and dry. Among them, while the full quantity of fresh ginseng and Taekuksam are consumed in ginseng root type and approximately 95% of white ginseng is consumed as ginseng root and only approximately 5% is distributed as processed products, red ginseng is more consumed in various processed forms (67%) than in ginseng root (33%) form. In particular, the representative ginseng of South Korea is red ginseng and its related products are widely consumed as health supplements, general food, medicine and the majority (estimating more than 90%) is consumed as health foods (agricultural products, health supplements, and general food) (Table 5).
Production amount by classification of each ginseng type in South Korea
These red ginseng health supplements are consumed in the forms of ginseng root, powder, tablet, capsule, concentrated extracts, soft capsule, pill, granule, beverage, candy, etc. The production amount by classification of each ginseng type in South Korea as of 2009 is estimated as follows.
In South Korea, ginseng is widely being consumed by children as well as the elderly. Recently, ginseng consuming classes are gradually expanding to the children and the youth. Although most ginseng (Korea), they have become the most popular health foods for all of Korean. In South Korea, ginseng consumption stays steady throughout a year and especially, the sales reaches the highest marks around New Year’s Day, Parents’ Day, Chuseok holiday seasons, etc.
Red ginseng, the most attractive product of the South Korea ginseng markets, takes approximately 59% in the entire South Korean market, and the consumption is continuously rising every year and growing steadily each year in every ginseng type as well as health foods (Fig. 2).
Recent market trends of red ginseng in South Korea.
The key reasons why specifically ginseng (Korea) is loved by customers in South Korea, are shown above. The meaning can be reaffirmed from the fact that ginseng (Korea) was originated from “Panacea (cure-all).” The efficacy research by the modern scientific approach started from 1950, and research is still being conducted by many eminent scholars to explore the mysterious efficacy. In South Korea, there are about 1,000 scholars who study ginseng, and more than a hundred of research papers are published every year.
Various effects of ginseng have been reported so far; anti-stress effect , improvement on cognitive function , prevention on memory impairment , anti-wrinkle effect , treatment of androgenic alopecia , prevention of influenza virus , gastroprotective effect , anti-diabetic effect , hepatoprotective effect , renoprotective effect , efficacy in erectile dysfunction , effect on blood circulation , efficacy in inhibiting acquired immune deficiency syndrome virus (human immunodeficiency virus) growth , efficacy in improving female climacteric disorder , protection against 2,3,7,8-tetrachlorodibenzo-p-dioxin , anti-oxidant effect , cancer prevention , etc. including homeostatic maintenance [3,21] of human body . Since ginseng is the most popular health food in Korea, the consumption will undoubted keep increasing.
FUTURE OF THE WORLD GINSENG MARKET
Due to a growing well-being trend around the world, the health food market focusing on natural food, medicine, and other end products of chemical synthesis of health food is expanding greatly. As of 2009, the market size of the world health foods is estimated to be $254,237 million. Since the value of ginseng is evaluated as the highest among natural health foods, if health products with various functions using this ingredient are developed, they will be able to tremendously enhance the quality of life and become the world bestseller.
Until now, the ginseng market maintained the premium around Asia based on the traditional efficacy. However, if a variety of products and marketing appropriate for the international market and customers are developed along with scientific research on efficacy, the value could expand beyond Asia and to the world in the future.
According to the international spread of ginseng consumption, the marketing strategies such as new distribution development, brands, design, packaging, price, product differentiation, etc. should be accompanied along with continuous investment in research and development in ginseng cultivation, new material development, efficacy, new product development, etc.
With a global expansion of the health food market, ginseng is still considered to have potential for market expansion. Since numerous people have been consuming it for more than 1,000 years and the effects are being revealed by experiences as well as modern scientific approach, if a variety of functional materials with ginseng or health foods are developed, it is expected to form the world’s largest health food market. For continuous growth and development of the ginseng industry, it is important for “ginseng” brand to be recognized by the market and consumers, and an optimal marketing communication strategy implementation focusing on distribution thorough analysis on the target market is in need. We hope that ginseng, one of the treasures from nature, continues to promote health of mankind and improve the quality of life.
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