This is partly a result of an increased dynamism in the sweetener industry, which is currently seeing a number of new options available after years of relative stability, according to the latest market information.
Published by research firm The Freedonia Group, the report reveals that US demand for alternative sweeteners is projected to increase 4 percent per year, to reach $1.1bn in 2010, up from $772m in 2000 and $935m in 2005.
Volumes are expected to grow by just over 3 percent annually, continuing the steady upward trend so far witnessed this decade.
But although overall volumes will increase, the market for high intensity sweeteners will be suppressed by falling prices, as patent protections expire and new competitors - especially importers based in developing nations - enter the marketplace, said Freedonia.
High intensity sweeteners are expected to remain the largest product category through 2010, due to their leadership position in diet soft drinks and tabletop uses, which are among the main applications for alternative sweeteners.
In diet soft drinks, aspartame and acesulfame potassium (ace-K) are forecast to remain the leading products, due to their use in many of the top brands.
Prices for the two products are forecast to decline by around 1-2 percent annually over the next few years, a "gentle erosion" compared to the high single-digit declines that occurred after their patent protections fell off.
Although not yet a significant threat to aspartame's dominant position in diet soft drinks, sucralose has become the leader in the key tabletop sweetener market, said the report.
According to Freedonia, sucralose, the main sweetener in Tate & Lyle's well-known Splenda product, has grown from niche status to "market powerhouse" in just a few years since its Food and Drug Administration (FDA) approval for use as a general sweetener.
Although the product will inevitably see a sharp fall in price as patents expire and large-scale competitive production enters the marketplace, there is not as yet any definite indication as to when this will occur.
"Up until now, sucralose has not seen the kind of price erosion that happens with high intensity sweeteners because demand has remained strong, and also because Tate & Lyle still maintain some patents on the production techniques that have really prevented new producers from entering the market in the same way," Freedonia analyst Mike Richardson told FoodNavigator-USA.com.
Saccharin, once the only commercially significant high intensity sweetener, will see its market share continue to diminish, although it will retain a significant presence in oral care products and tabletop sweeteners, said the report. Prices for this product have already stabilized, and are likely to remain around the $3/lb mark.
Neotame remains a relatively new product, and has not as yet established a strong market presence, according to Richardson. Prices are not forecast to see substantial declines in the near future.
Polyols such as sorbitol and mannitol are used mainly in food applications, which are projected to register faster growth than the large but mature diet soft drink market, which is dominated by high intensity sweeteners.
This group of sweeteners is expected to continue to benefit from their image as natural products rather than synthetic chemicals, and from continued interest in reducing sugar intake to combat obesity, tooth decay and diabetes, according to Freedonia.
"Sorbitol is the largest and most established product, and will register below average growth. Xylitol is expected to register above average. It has less than half the calories of sugar, but is equally sweet, making it a desirable tabletop replacement for sugar packets. Moreover, it has been shown to kill bacteria which can cause dental cavities, a property that many candy and gum manufacturers have seized upon in product labeling and advertising," said the report.
An increased global production of polyols will likely lead to a "slight decrease" in pricing, said Richardson, although this will be nothing like the type of declines seen in the pricing of products with patent protections, he added.
The four main players in the sweeteners market in 2005 accounted for more than half of total US sales. These include Tate & Lyle, NutraSweet, Roquette America and SPI Polyols, the later of which this month signed an agreement to sell its food business to Corn Products International.
Other leading suppliers include Ajinomoto, Archer-Daniels-Midland (ADM), Cargill, Nutrinova (Celanese) and PMC Specialties Group. DSM's Holland Sweetener Company was also a player, but exited the business at the end of 2006. Other distributors to the US market include Cumberland Packing, McNeil Nutritionals, and Merisant.