Officials at NutraSweet Inc. have said they plan to re-open a Georgia plant that produces the chemical aspartame, a key ingredient in many artificial sweeteners.
The plant has been closed since 2003, and officials expect it to be running at full capacity again by 2006. This will lead to a 30 percent increase in aspartame production and will help satisfy fast-rising demand, which is increasing at a steady 4 to 5 percent annual clip, industry analysts say.
In recent years, demand for artificial sweeteners has grown faster than that for sugar.
With more consumers switching to diet soft drinks, NutraSweet Co., a leading producer of aspartame, plans to restart a mothballed production line at a Georgia plant this year to satisfy increased demand for the sugar substitute.
The plans will result in a 30 percent increase in aspartame production, NutraSweet Chief Executive Craig Petray said.
"Despite sucralose getting most of the headlines in recent months, the resurgence in demand for aspartame is a key development in 2004," said Nick Fereday, a senior economist at LMC International Ltd., a New York consulting firm that tracks developments in the sugar and sweetener industries.
The demand for low-calorie sugar substitutes has been so strong that right now there is room in the market for all of these sweeteners to grow, according to Fereday.
Once restarted, the company's production capacity will rise to 10,000 metric tons.
Current aspartame production is estimated to be in the range of 16,000 metric tons and 16,500 metric tons, Petray said.
Petray estimates about 80 percent of its aspartame is used by beverage manufacturers such as Coca-Cola Co., PepsiCo Inc., and Cadbury-Schweppes PLC.
According to data collected by Beverage Digest/Maxwell, sales volume for the leading U.S. diet soda, Diet Coke, rose 5 percent last year.
Diet Pepsi volume climbed 6.7 percent, and Diet Dr Pepper rejoined the top 10 best-selling soft drinks with a 16.2 percent increase, according to Beverage Digest.
As a tabletop sweetener, Splenda is marketed by McNeil Nutritionals, a unit of Johnson & Johnson based in Fort Washington, Pa., and its success has been remarkable.
The list of manufacturers creating products with Splenda continues to grow and now includes Pepsi One, which has been reformulated with Splenda, as well as a new Splenda-sweetened version of Diet Coke.