Market for alternative sweeteners shifts away from beverages to food
Demand for alternative sweeteners in the food market is forecast to be $870 million by 2020, with food applications continuing to take market share from beverage applications — albeit at a slowing rate — according to a study by industry research firm The Freedonia Group.
“In 2005, beverages accounted for over one third of total alternative sweetener demand; that share is expected to fall to just under one quarter in 2020,” said analyst Christine O’Keefe.
The shift is the result of several factors, including:
- Above-average growth in food uses, supported by continued development of new applications
- Declining demand in beverages due to falling carbonated soft drink production
- Health concerns regarding alternative sweeteners, particularly in beverages, which are often consumed in higher volumes than food.
By 2020, food applications are forecast to represent 57% of the artificial sweetener market, compared to 24% for beverages. Food market gains are expected to be supported by new applications for alternative sweeteners in a wide variety of applications, including dairy products and baked goods.
High-intensity sweeteners are forecast to account for 45% of total demand in 2020, supported by their widespread use in both food and beverage applications. The fastest growth will be seen for acesulfame potassium, supported by the growing use of sweetener blends that take advantage of its sweetness-enhancing properties. Falling carbonated soft drink production will negatively impact aspartame demand.
Growth for natural alternative sweeteners is forecast to expand at a double-digit pace to 2020 and beyond, with gains supported by growing consumer interest in ‘all natural’ and ‘clean label’ foods and beverages. Stevia products will be a strong growth market, as producers offer a larger selection of products with improved flavour profiles. Below-average increases, however, are forecast for agave nectar, as concerns regarding the potential health impact of its consumption restrain growth.
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