Sugar Substitutes Industry Insights
The global sugar substitutes market was valued at USD 13.03 billion in 2015 and is expected to witness opportunistic growth over the forecast period. Burgeoning population coupled with rising disposable income in developing economies, increasing awareness among consumers for low calorie and healthier food & beverages are the key driving forces expected to boost the demand for sugar substitutes.
Increasing incorporation of sugar substitutes in the health & personal care industries will further propel their demand over the forecast period. Fluctuating supply and prices of sugar and rising prevalence of health problems related to sugar consumption are anticipated to augment the global sugar substitutes market in the near future.
Cargill, Incorporated, Tate & Lyle PLC, E. I. du Pont de Nemours and Company, Archer Daniels Midland Company and Ingredion Incorporated are key manufacturing companies involved in the manufacturing & distribution of sugar substitutes globally. These market players are actively involved in the development of new products and advanced technologies to provide innovative, cost-effective and premium quality sugar substitutes to the consumers across the globe. The market participants are also engaged in mergers and acquisitions, to expand their market reach and proliferate the global market, especially into the emerging economies such as India, Brazil, China and countries of the Middle East & Africa.
Sugar substitutes are used across a wide range of applications ranging from the bakery, confectionery, dairy, frozen foods, beverages, pharmaceuticals and personal care. Rising health awareness among the population and ongoing technological advancements are key factors which will augment the market growth over the forecast period.
However, stringent regulatory framework and obscurity among common masses regarding consumption of sugar substitutes triggering health problems are anticipated to restrain the market growth over the forecast period. Stringent quality criteria complying with the international quality standards and regulations are major bottlenecks which will limit the demand for sugar substitutes in the near future.
North America sugar substitutes market revenue, by product, 2013 - 2024 (USD Million)
High fructose syrup dominated the global sugar substitutes market, accounting for over 70% of global volume in 2015. However, this segment is projected to lose market share over the forecast period, due to augmented concerns over health and nutrition. High fructose syrup is being replaced by high-intensity sweeteners, and this is attributed to harmful effects associated with the consumption of high-fructose syrup, which is quite similar to that of sugar.
High-intensity sweeteners accounted for the highest market share regarding revenue and is expected to grow at a CAGR of over 4.0% from 2016 to 2024. Due to its attributes such as cost reduction and appropriate blending with food & beverages to enhance the taste are anticipated to propel the demand for high-intensity sweeteners in the near future. Developed economies such as North America and Europe are the major users of high-intensity sweeteners in alcoholic beverages.
Growing demand for dairy & bakery products, dessert, and confectionaries from the developing countries are expected to further drive the demand for sugar substitutes over the forecast period.
Sugar substitutes in beverages was valued at over USD 5.0 billion in 2015. This segment is expected to grow on account of rising demand for high-intensity sweeteners in alcoholic beverages, especially from developed economies such as North America and Europe. Additionally, sugar substitutes are gaining popularity in carbonated beverages, due to its attribute to enhance the taste of these beverages. This segment will achieve below average growth over the forecast period.
Food segment is expected to achieve the fastest growth over the forecast period, owing to increasing awareness and changing consumer patterns for low-calorie food products. The major market players in the food industry are focused on the development of superior quality products at economical pricing. The above trends are expected to propel demand for sugar substitutes over the forecast period.
Food segment includes bakery & confectionery products, dairy products and others such as frozen food. Food segment is dominated by bakery & confectionery products followed by dairy products. Sugar substitutes are extensively used in processed foods such as canned foods, baked goods, powdered drink mixes, soft drinks, candy, jams and jellies, soft drinks, dairy products and ice creams.
North America sugar substitutes market accounted for over 40% of global volume in 2015. The sugar substitutes market is quite mature in this region due to growing consumer demand for sugar substitutes, diverse food processing industry, rising prevalence of diabetes and increasing obesity amongst the population.
U.S. dominates the North America sugar substitutes market accounting for over 70% in terms of volume, as of 2015. However, the demand from Canada & Mexico will grow at a faster rate than U.S.
Asia Pacific demand was valued over USD 2.0 billion and is anticipated to witness highest CAGR of over 6.0% from 2016 to 2024. Improving living standards of middle-class population coupled with the increased power of spending and growing concerns among health conscious population are expected to augment the market growth over the forecast period.
Asia Pacific and MEA regions are estimated to achieve highest gains in the near future, followed by Latin America. The sugar substitutes market is projected to grow fastest in these regions due to rising health issues related to sugar consumption, the presence of emerging economies providing lucrative profit margins to the key market participants and rising disposable income. Significant growth in these regions is also attributed to the increasing proliferation of sugar substitutes in the personal and healthcare industries.
Competitive Market Share Insights
The global sugar substitutes market is fragmented in nature, with the presence of a large number of market participants. However, the major market share is being shared by the big giants such as Cargill, Incorporated, Tate & Lyle PLC, E. I. du Pont de Nemours and Company, Archer Daniels Midland Company and Ingredion Incorporated. These key players have strong hold into the regional markets.
The companies are significantly investing into research & development for natural alternatives such as Stevia. This is evident from the high degree of product launches for stevia worldwide. For instance, Cargill Incorporated introduced ViaTech, the next-generation stevia-based sweetener into its product portfolio to enhance the taste of reduced-sugar products in 2014.
A few years ago, stevia was majorly known among the industry experts, however after the approval from European regulatory bodies for the use of steviain drinks and foods, there has been an upsurge in the new product launches in Europe to exploit the consumer demand. The widespread product launches containing stevia witnessed a massive 400% increase in launches globally in between 2008 to 2012 and between 2011 to 2012; this increment was over 150%.
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