ZMUni Compliance Centre

In the first half of 2024, Chinese cosmetic ingredient enterprises demonstrated steady and impressive performance, in contrast to the significant fluctuations seen by international giants. Despite an overall sluggish consumer market, leading personal care and ingredient enterprises maintained solid growth momentum. 

In the competitive Chinese cosmetic ingredient market, recombinant collagen has emerged as a standout ingredient. In terms of ingredient types, plant-based and chemical ingredients are now on equal footing. Chinese companies are increasingly exploring China’s unique plant resources, leveraging differentiation strategies to unlock the potential of plant extracts and establish strong product barriers.

So far, Chinese cosmetic ingredients enterprises have released their financial reports for the first half of 2024, with mixed results across the industry.

Chinese Cosmetic Enterprises Revenue and R&D Investment in 2024 H1

Chinese Cosmetic Enterprises Revenue and R&D Investment in 2024 H1 

ZMUni Compliance Centre recently made a summary of the annual reports of several Chinese ingredients and cosmetics enterprises, highlighting key information concerning the R&D and production infrastructure development of these enterprises in 2024 H1.  

Chinese Cosmetic Ingredients Enterprises

SHANXI JINBO BIO-PHARMACEUTICAL CO., LTD. (“锦波生物”in Chinese)

The company excels in researching and industrializing original functional protein ingredients, particularly Recombinant Humanized Type A Collagen. In the first half of 2024, revenue from ingredients and other operations reached 238 million RMB, a 180.07% increase compared to the same period last year. This growth was driven by two factors: a steady rise in purchases from well-established brand partners and an expanding customer base as the company’s ingredient products gained greater recognition.

COSMOS (“科斯股份”in Chinese)

The company primarily engages in the R&D, production, and sales of daily chemical ingredients, including active cosmetic ingredients like UV filters and synthetic fragrances. In the first half of 2024, revenue from cosmetic active ingredients and related materials reached 1.2 billion RMB, a 15.07% increase compared to the same period last year. Meanwhile, revenue from synthetic fragrances grew to 190 million RMB, marking a year-on-year growth of 41.08%.

AHB (“华恒生物”in Chinese)

During the reporting period, the sales volume of the company's amino acid-based products continued to grow, benefiting from strong market demand and supply. Additionally, new products such as 1,3-propanediol, succinic acid, malic acid, tryptophan, and arginine were launched as planned, further expanding the company's operational scale.

Freda (“福瑞达”in Chinese)

With a strong emphasis on technological innovation, the company leverages key ingredient advantages such as hyaluronic acid, polyglutamic acid, fullerene, lavender essential oil, and ectoin. Additionally, it holds patents for ingredients like silanized hyaluronic acid and fermented brown algae, establishing robust brand and technology barriers. In July 2024, Freda successfully notified its first new cosmetic ingredient, 10-hydroxy-2-decenoic acid (royal jelly acid), synthesized through bioengineering.

Bloomage Biotech (“华熙生物”in Chinese)

During the reporting period, leveraging six major R&D platforms, the company successfully introduced a total of 6 new bioactive products and ingredients, including Bloomsurfact™ Bacillus lipopeptide sodium, Bioyouth™-NANA N-Acetylneuraminic Acid, Bloomcolla™ Col III-Y05 recombinant type III collagen, Hymagic™-AcHA (Sodium Acetylated Hyaluronate), UltraHA® J Sodium Hyaluronate, MitoPQQ™ Pyrroloquinoline Quinone Disodium(PQQ)Salt. Bloomage also made good progress in the R&D testing of several other products and ingredients.

CN BIO (“川宁生物”in Chinese)

During the reporting period, the company's main focus in R&D has been on the production of ingredients as follows:

Chinese Cosmetics Enterprises

Marubi (“丸美” in Chinese)

During the reporting period, the company advanced 36 projects for the development of innovative self-researched ingredients and enhanced the construction of scaled production lines for recombinant functional proteins.

CHICMAX （“上美”in Chinese）

During the reporting period, the company completed the notification of the ingredient "Cyclohexapeptide-9" and obtained three invention patents. As of the publication date, CHICMAX has successfully notified one NCI.

PROYA (“珀莱雅”in Chinese)

During the reporting period, the company continued to enhance its R&D efforts across all key stages, from ingredients to products, including fundamental research, formula development, and efficacy evaluation. The focus remained on skin mechanism research, active ingredient design and efficacy verification, as well as the development of new products in skincare, makeup, and personal care. As of the publication date, PROYA has successfully notified one new cosmetic ingredient.

BTN (“贝泰妮”in Chinese)

During the reporting period, the company's R&D activities progressed smoothly, leveraging the resources and advantages of the Yunnan Province Specialty Plant Extraction Laboratory platform. The company conducted targeted research in various areas, including foundational studies on unique plants, development of innovative ingredients, functional cosmetics, functional foods, medical devices, and packaging solutions. 

During the reporting period, the company successfully completed the notification of 5 NCI,  which are all the plant-based ingredients. As of the publication date, BTN has finished a total of 10 NCI notification.

SYG (“水羊股份”in Chinese)

The company has established three core research platforms for plant extraction, biosynthesis, and green chemistry, collaborating closely with research institutes on key projects. This has led to the development of over 10 proprietary cosmetic ingredients. As of the publication date, SYG has registered four new cosmetic ingredients with the National Medical Products Administration.

Fuerjia Technology (“敷尔佳”in Chinese )

During the reporting period, the company successfully finished the NCI notification of Acetyl Curcumin and Matrine Salicylic Acid. Additionally, the notification of Ledum Palustre essential oil, a unique Northeastern plant extract, is in progress. As of the publication date, Fugejia has notified a total of three NCI.

Some trends in China's cosmetics industry

| Slower Domestic Growth, Industry Seeks New Opportunities

According to the National Bureau of Statistics, retail sales of cosmetics in major outlets reached 216.8 billion RMB, a 1.0% increase year-on-year. However, this growth rate lags behind the 3.7% increase in overall retail sales of consumer goods and the 5.0% rise in national GDP, signaling a slowdown in the cosmetics industry's growth. Companies need to explore new drivers of expansion.

| Strong Export Growth, but International Challenges Remain

Data from China's General Administration of Customs shows that in the first half of 2024, cosmetics imports totaled 59.32 billion RMB, down 9.6% year-on-year, while exports grew 11.9% to 23.25 billion RMB. Some companies reported rising overseas revenue, but uncertainties in the global political and economic landscape pose risks, particularly for those heavily dependent on international markets.

| Intense Competition in the Chinese Market, Focus on Core Technologies

The influx of new local brands and the expansion of existing ones have intensified competition. Developing proprietary ingredients and promoting branded raw materials have become significant industry trends. Companies that maintain a core technological advantage in specific areas are more likely to achieve sustained growth.

| Green and Sustainable Practices Gain Consumer Favor

As local brands capture a larger market share, consumers have higher expectations for product quality, innovation, and brand image. Additionally, growing environmental awareness is driving consumers to favor companies that adopt green practices in packaging, production, and supply chain management.

Note: The reporting period in this passage refers to January - June 2024.

Source: 2024 Mid-Year reports of the relevant enterprises.