US Demand for Alternative Sweeteners to Exceed $1.3 Billion in 2013

US demand for alternative sweeteners is projected to increase 3.4 percent annually to more than $1.3 billion in 2013.  This unremarkable growth forecast taken alone masks a number of diverse, sometimes conflicting, trends in what has become a dynamic industry, enlivened by new products and responses to evolving consumer preferences (which at the moment favor natural, less processed ingredients).  While growth in diet soft drinks, historically the largest outlet for alternative sweeteners, will be almost nonexistent, other applications will offer opportunities for growth.  This trend will lead to above average gains for sucralose and acesulfame potassium (ace-K), as well as for low-calorie polyols such as erythritol and newer options such as the stevia extract rebiana (reb-A).  These and other trends, including market share and product segmentation, are presented in Alternative Sweeteners, a new study from The Freedonia Group, Inc., a Cleveland-based industry research firm.

High intensity sweeteners, despite the drag of a declining soft drink market, will remain the largest product category among alternative sweeteners.  This leadership position is rooted in their domination of the large diet soft drink and tabletop sweetener markets.  Aspartame will remain the leader in diet soft drinks, despite relentless scrutiny about its safety and competition from newer products.  All of the top ten diet soft drink brands use aspartame, either alone or in conjunction with other high intensity sweeteners.  The tabletop market will continue to be led by sucralose, largely due to Tate & Lyle’s SPLENDA, which skyrocketed from new product to market leader in only a few years.  Though expected to remain a fairly small share of the overall market, newer alternative sweeteners will register the sharpest growth and generate the most buzz among food and beverage processors, as well as among consumers.  The most buzzworthy new product has been reb-A, an extract of the stevia plant. 

Nevertheless, conventional sweeteners -- sucrose and corn sweeteners -- will continue to dominate the overall sweetener market in the US.  Despite the best efforts of producers, no alternative sweetener is fully competitive with sugar in terms of cost, functionality and taste.  Although sugarless gums outsell regular versions, conventional sweeteners dominate most other market segments.  Even diet soft drinks, one of the great market successes for alternative sweeteners, account for less than a third of carbonated soft drink production. 

The Freedonia Group is a leading international business research company, founded in 1985, that publishes more than 100 industry research studies annually. This industry analysis provides an unbiased outlook and a reliable assessment of an industry and includes product segmentation and demand forecasts, industry trends, demand history, threats and opportunities, competitive strategies, market share determinations and company profiles.