Tate & Lyle controls supplies on Splenda success

Rationing supplies, the British firm said it would not be taking on any new customers in the US until the Alabama plant extension in 2006 and the new Singapore plant in 2007 come on line.

Without disclosing production capacity, a spokesperson for the London-based company said sucralose production will double by early 2006, when the first phase at Alabama is completed.

"The demand for sucralose has far exceeded all our expectations, with sucralose proving extremely popular with both manufacturers and their consumers,"​ Tate & Lyle said in a statement.

Demand for the company's sugar replacer, 600 times sweeter than sugar and sold under the Splenda brand, has seen major international players like PepsiCo, General Mills and Unilever introduce the sweetener into a range or reduced-sugar formulations.

But if supplies are unable to keep up with demand, the firm might face lost business as developers turn to alternative ingredients to fill the formulations.

Although Tate & Lyle has the industry that it 'will work with our current customer base in order to manage their sucralose requirements going forward.'

The product is produced at one sole plant, slated for a £24 million face-lift, in Alabama, US. Anticipating supplies based on today's growth rate, Tate & Lyle recently took the decision to invest some $175 million (£97 million) in a second sucralose manufacturing facility to be constructed in Singapore. Observers question whether the decision was taken early enough and if the situation today could have been avoided.

Sucralose is permitted in 40 countries, but has only recently been accepted onto the EU25 market through an amendment to the 1994 EU Sweeteners Directive (94/35/EC), cleared in February this year.

The market for the ingredient (E955) holds considerable potential as rising health concerns drive consumers towards sugar free products and food makers introduce zero-calorie or low-calorie sugar substitutes into their new product formulations.

Market analysts Freedonia​ predict growth of intensity sweeteners at around 8.3 per cent year on year until 2008, with sales risng from a small base of $81m in 1998 to $189m in 2008.

Sucralose was developed jointly by US firm McNeil Specialty Products and Tate & Lyle. The London firm became the sole manufacturer of Splenda in April this year after reaching an agreement with McNeil Nutritionals whereby the British group is responsible for worldwide sales of the Splenda brand to food and beverage makers while McNeil targets retail (tabletop) and foodservice sales.