Australian rare sugars project targets high-value F&B sweetener opportunity

Researchers in Australia are using fermentation to produce low-calorie rare sugars from cane syrup, which could potentially open a higher-value, healthier future for the country’s sugar industry. The approach could give F&B manufacturers an alternative to table sugar that delivers fewer calories while retaining the sweetness, texture, and baking performance consumers expect.

Synthetic biologists and bioprocess engineers at The University of Queensland (UQ) are working on converting raw sugars into rare sugars in what they describe as “microbial cell factories” at the US$70 million UQ Biosustainability Hub. The project is housed at the hub, which was officially launched at the university’s St. Lucia campus today.

The center aims to support innovations addressing challenges such as climate change, limited resources, food security, and industrial emissions.

Dr. Axayacatl Gonzalez, the Integrated Design Environment for Advanced biomanufacturing (IDEA) Bio manager and senior research platform fellow at the Australian Institute for Bioengineering and Nanotechnology, is leading the project along with his team at the hub, explains that rare sugars occur in some fruits, and they are increasingly coveted as alternative F&B sweeteners by the hospitality and commercial food industries.

These sweeteners offer sensory and functional qualities to raw sugar while offering lower-calorie and health-focused benefits. However, he flags production costs as a barrier to their widespread applicability in the F&B sector.

“The good news is we are able to harness natural processes in our lab to produce a variety of rare sugar molecules, using fermentation technologies which provide a sustainable alternative for the manufacturing of these molecules directly from raw sugar.”

Bacteria to rare sugars

Consumer preferences are increasingly driving sweetener innovation, as nearly 72% actively cut sugar from their diets, suggests Innova Market Insights data. Soft drinks had the largest share of launches with sweeteners between Jul 2024 and Jun 2025, the market researcher highlights.

Dr. Nathan Zhong engineered bacterial metabolism to create microbial cell factories that convert cane syrup feedstock into rare sugars.This demand is sharpening interest in production routes that can deliver sugar-like taste and functionality with fewer calories. At UQ, researchers are engineering bacteria commonly found in Queensland cane fields. However, they do not disclose the specific microbial strain used in the process.

Dr. Nathan Zhong, an R&D scientist with Australia’s Food and Beverage Accelerator, engineered the bacteria’s metabolism so they can produce rare sugars when grown using cane syrup feedstock.

Zhong explains that once the right bacterial strain is identified, the process becomes straightforward: “raw sugar goes in, and rare sugars come out.”

“So far, we have a library of bacterial strains capable of producing rare sugars when grown in UQ’s custom-built bioreactors.”

The ongoing project is a part of Australia’s AUD 370 million (US$264 million) Trailblazer Universities Program and is expected to run until 2027.

Supporting Australian sugar production

Australia is one of the world’s largest sugar exporters, alongside Brazil, India, and Thailand, with the sector contributing around US$2 billion annually to the local economy, notes UQ.

The scientists position rare sugars not only as a possible healthier sweetener for soft drinks and foods, but also as a high-value opportunity for Australia’s sugar industry to remain competitive in a changing global market.

The UQ is collaborating with MSF Sugar, an Australian sugar grower, processor, marketer, and exporter of raw sugar, for the project.

According to MSF Sugar’s general manager of business development, Jia Poontanasombat, rare sugars could ultimately help Australian sugar producers remain competitive internationally.

The researchers emphasize that the project could help develop soft drinks and foods containing rare natural sugars with fewer calories but a similar taste to table sugar.“Rare sugars are a high-value commodity that possess obvious health and economic benefits,” she says.

“The work being done at UQ’s Biosustainability Hub is paving the way for producers to diversify their product offering in a way that meets the health needs of communities around the world.”

Turning bioscience into commercial food ingredients

The launch of the Biosustainability Hub highlights the role of national research infrastructure in turning “breakthrough science into real-world products and economic value,” says Australia’s Federal Assistant Minister for International Education Julian Hill.

He adds that the UQ Biosustainability Hub houses two National Collaborative Research Infrastructure Strategy (NCRIS)-funded national research facilities, offering researchers and industry the tools needed to rapidly develop and scale new biosolutions.

“Through NCRIS, the Government is not only supporting cutting-edge facilities and ‘kit’, but also the expertise needed to translate data into real-world outcomes. This is about ensuring Australia remains globally competitive, while building a more productive, resilient and forward-looking economy now and for the next generation,” Hill concludes.