Several nations, including Germany, Australia, India, Spain, France, and Mexico, have implemented taxes on sugar-sweetened beverages (SSBs) in an effort to reduce sugar intake. Among these nations, France is thinking of raising these taxes in 2025. Around 177.33 million metric tons of sugar were consumed worldwide in 2023–2024; despite regulatory measures and high taxes on sugar-filled foods and beverages, this amount is predicted to rise to 178.79 million metric tons in 2024–2025.
This consumption growth is mainly because the industry finds it very challenging to find sweeteners that are both healthier and taste good. Artificial sweeteners have been used in food instead of sugar for quite some time now, especially in beverages (aspartame and sucralose). These artificial sweeteners have yet to gain consumer trust due to the health risks associated with their excessive consumption.
The focus of the industry right now is both on sugar reduction and finding a replacement. Formulators are actively working on innovations to overcome the aftertaste issues with sugar substitutes, which make 100% replacement relatively difficult.
Plant-based Sweeteners: A Go-To Solution for Food Manufacturers
The majority of the substitutes that have been introduced to the market this year are stevia-based, making stevia a standout substitute for regular sugar for food companies. This is primarily because stevia does not add calories to the body when consumed, making it a far healthier alternative to regular sugar. Additionally, it has 200–300 times the sweetness of ordinary sugar.
Steviol glycosides, which are naturally occurring sweet substances found in stevia leaves, are extracted using both conventional and natural methods. People with diabetes benefit from the fact that steviol glycosides are not absorbed by the body in the upper digestive tract. Stevia’s global market was valued at approximately $405.6 million in 2024 and is projected to grow to about $739 million by 2034.
The industry launched many stevia-based ingredients in the last few quarters. For instance, Tate & Lyle (UK) has launched OPTIMIZER STEVIA® 8.10. This new ingredient offers a premium taste and is also a cost-effective alternative to sugar. Nura (U.S.) has introduced Madblend Stevia Extract, which is developed using fluid bed technology, ensuring the product dissolves easily, dries quickly, and delivers consistent sweetness. Ingredion (U.S.) developed PureCircle Clean Taste Solubility Solution, a stevia-based sweetener.
Recently, sweet proteins derived from fruits have been in the limelight. Sweet proteins are a class of proteins that deliver a sugar-like sweetness but don’t affect blood sugar, insulin, or the gut microbiome. Thaumatin and monellin are the two sweet proteins that have received regulatory approval from the EU, Switzerland, Israel, the US, and the FDA.
Other plant-based natural sweeteners, such as monk fruit and allulose, are also becoming popular choices for food manufacturers.
Monk fruit is found in South China and is 100-250 times sweeter than regular sugar. It has also been generally recognized as safe (GRAS) by the FDA since 2010. The sweetness of monk fruit is derived from mogrosides, specifically the glycoside mogroside V. These are not absorbed in the upper gastrointestinal tract, meaning they don’t provide any calories or affect blood sugar levels. Scotty’s Everyday (U.S.), a company that specializes in baking mixes without sugar, has introduced a new Allulose & Monk Fruit Zero Calorie Sugar Replacement. The new sweetener is a blend of allulose and monk fruit extracts. Elo Life Systems (U.S.), a food ingredient company, has received $20.5 million in funding this year and plans to use this new funding to scale up its sweetener production. Elo’s first product, a monk fruit-derived sweetener, will be launched in 2026. Capri Sun (Switzerland) is reducing the sugar content in its original juice drink pouches by an average of 40%. The brand is reformulating its drinks by replacing some of the sugar with monk fruit concentrate.
Allulose, on the other hand, does not originate from a single source; it can be found in small amounts in plant foods such as brown sugar, maple syrup, figs, and raisins. It is commercially made from corn or fructose. Although it is roughly 70% sweeter than regular sugar, it only has about 10% of the calories of regular sugar. This also does not affect blood sugar levels and is GRAS approved by the FDA. Hometown Hero (U.S.) launched a new sugar-free gummy made from allulose and infused with 25 mg of Delta-9 THC and live rosin. 1-2-Taste (India) has become the first and only company in India to get approval from the Food Safety and Standards Authority of India (FSSAI) to import and sell allulose.
Stevia is popular because it only takes a very tiny amount of stevia to replicate the flavor and texture of regular sugar, which ends up being economical for businesses. Also, monk fruit is pricier due to its complex extraction process and limited supply. Another factor contributing to the high demand for stevia may be its compatibility with other sweeteners and health-focused ingredients, which eventually aids in creating blends that can satisfy various application requirements.
There are many grades of stevia. Firstly, stevioside grade, which is a low-quality and less expensive grade that also has a bitter aftertaste, and secondly, Rebaudioside A (Reb A), which offers high purity and is cleaner, with a sweeter taste compared to stevioside. Lastly, Rebaudioside D and M are advanced grades, the most premium compared to other grades, and offer a similar taste to sugar. To help ease the extraction and availability of Reb M, many innovations are happening in the industry, like enzymatic bioconversion and fermentation being used. For example, Arzeda (U.S.) extracts Reb A from stevia leaves and then uses enzymes (bioconversion) to convert Reb A into Reb M. Tate & Lyle (UK) have collaborated with Manus Bio (U.S.) to develop high-quality Reb M using bioconversion techniques. Ingredion (U.S.) is also using bioconversion to produce Reb M from Red A.
Low grades of stevia offer very little solubility in water, which limits its use in beverages. Currently, stevia is standing out as the top alternative in the market, and its advanced grades are being developed to tackle the present challenges.
Sugar Reduction: Regional Markets and Regulations
Earlier this year, the USDA introduced regulations to set limits on added sugars in school meals. Starting in July 2025, breakfast cereals served in schools will be restricted to 6 grams of added sugar per ounce, and yogurt will be limited to 2 grams of added sugar per ounce. Additionally, beginning in July 2027, added sugars in school meals (lunch and breakfast) must account for less than 10% of total weekly calories. The North American market has relatively fewer food products with low/reduced sugar claims. As of 2024, only 11.3% of food products carry these claims, though this is an increase from 2023 when it was 9.75%.
This year the EU Parliament also approved new labeling rules that include labels on fruit juices that must now clearly show their sugar content; however, this new regulation is yet to receive approval. In the EU there are already strict labeling regulations implemented for more than a decade, such as food products must have no more than 5 g of sugar per 100 g for solids or 2.5 g per 100 ml for liquids, and if a product contains a sweetener, it must be labeled with the word “sweetener,” followed by its name or E-number.
Due to strict regulations, brands follow sugar reduction policies in the EU. Their products in the EU are labeled as ‘no added sugars’ and ‘low sugar, while the same products may contain added sugar in other countries. For example, this year the International Baby Food Action Network (IBFAN) report stated that Nestlé’s baby food products sold in India, Africa, and Latin America have higher sugar content compared to the same products sold in Europe. Europe manufactures the highest number of food products with low/reduced sugar claims globally. In 2024, 45.6% of these products were made in the EU, which accounts for almost half of global production.
The trend of sugar reduction might have started relatively late in APAC, but now it is growing at the fastest pace compared to other regions. In 2021, 19.3% of food products in APAC included claims such as low/reduced sugar and no added sugars, and by 2024, this increased to 21.9%, which shows approximately a 2.6% increase over the last 3 years. The government is also imposing taxes on food items that contain added sugars.
Conclusion
Stevia has been continuously evolving over the past few years in terms of the extraction process/technologies. Desired properties, such as high solubility for beverages and reduced aftertaste in products, are being addressed by innovative launches in the market. While we can see that there is a growing use of stevia in different types of food & beverage categories like bakery, chocolate, confectionery, and beverages, it would be interesting to see how suppliers navigate their way through the evolving needs of food manufacturers.
Stevia stands as a great opportunity to transform the world of plant-based natural sweeteners after the artificial sweeteners failed to earn the end consumer’s trust and are termed potential carcinogens. So it would be interesting to see how suppliers innovate stevia-grade offerings by optimizing production technologies for better yield while keeping up with their sustainability initiatives and catering to this ever-changing market.
This article was originally published in the January issue of the Food and Drink Industry Magazine.
