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Sugar Processing in the US - Industry Market Research Report

United States sugar processing market: $10.5 billion industry by 2018

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2014-02-21 23:59:02 - Sugar Processing in the US - Industry Market Research Report - a new market research report on

The United States Sugar Processing market has benefitted from increased demand since 2009, when research findings pointed to high-fructose corn syrup (HFCS) as a likely health hazard leading to diabetes and obesity. In response to a shift in consumer demand away from HFCS toward sugar, downstream producers made efforts to switch their preferred sweetener from HFCS to sugar, which benefited the Sugar Processing industry. Revenue is forecast to grow a mere 0.3% in 2013 due to a combination of higher sugar prices and less per capita sugar and sweetener consumption. IBISWorld expects industry revenue to grow at an annualized rate of 4.5% through the five years to 2013, totaling $9.9 billion.

Regulatory measures have been, and will continue to be, important



revenue and profit determinants for the industry.

The US government provides loans, sets marketing allotment quotas and determines tariff rate quotas to keep domestic sugar prices inflated. During the five years to 2013, IBISWorld expects these policies to sustain industry profit, which currently accounts for a steady 18.5% of revenue.

Quickly ascending imports are expected to limit revenue and profit growth for sugar processors. Since 2008, open trade relations between the United States and Mexico have allowed lowpriced imports to come into the domestic market, fulfilling unmet domestic demand. Import values have grown 14.0% per year on average over the past five years, and are expected to continue growing over the five years to 2018.

Alternative energies may be able to push industry revenue and profit up during the next five years. Bagasse, a by-product of sugarcane refining, is currently being used as an electricity source for refineries. If the industry is able to expand this into other sectors of the economy, sugar processing may be pushed forward into its growth phase.

However, IBISWorld forecasts many of the current trends to continue into the next five years. Low-cost imports will provide sugar buyers with an alternative to the domestic product.

Additionally, consumers are expected to take advantage of sugar substitutes, which are becoming prevalent on the market. Consequently, revenue growth will slow in the next five years and increase at an average annual rate of 1.2% to $10.5 billion.

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