By Amber Murray,Elena Leya

Copyright cityam

Tate & Lyle’s share price dropped more than six per cent on Monday morning after Morgan Stanley changed its rating for the sugar giant.

The broker cut the stock to “underweight” from “equal weight”, with a 500p price target.

It cited higher risk to Tate & Lyle’s mid-term targets after Tyson Foods said it would phase out sucralose from US-branded products, with the risk that more consumer packaged goods could follow.

Tyson will phase out the zero-calorie artificial sweetener and sugar substitute by the end 2025, as well as remove high-fructose corn syrup as titanium dioxide, in an effort to reduce additives.

“We continuously review and assess our product portfolio to ensure the highest quality products that meet the needs of consumers,” CEO of Tyson Foods Donnie King said in a statement.

He added the decision to remove high-fructose corn syrup “reflects our ongoing commitment to feeding the world like family.”

Tate & Lyle, meanwhile, has been making a significant push into taking sugar out of their biscuits, replacing it with scientific innovations designed to make consumer goods ‘healthier’.

McVitie’s digestive biscuits, for example, now come in a ‘light’ style, which utilises Tate’s Sta-Lite polydextrose fibre to cut the amount of sugar needed and up the fibre.

In its latest full-year results, the sweet treat behemoth said sucrose saw “robust demand” in the year to March, with revenue up 16 per cent, while overall group revenue fell five per cent.

Chief executive Nick Hampton said Tate & Lyle has been “executing a major strategic transformation” over the last seven years to make Tate & Lyle a “growth-focused speciality food and beverage solutions business aligned to growing, long-term consumer trends for healthier, tastier and more sustainable food and drink”.

“As an expert in reformulation, taking sugar, calories and fat out of food and adding fibre and protein, we are leaders in helping customers improve the nutritional balance of food,” he said.