Tate & Lyle has lost a patent battle to protect its sucralose sweetener against Chinese factories exporting their own version of the zero-calorie sweetener to the US.

The UK sugar refiner said that an appeal to the US International Trade Commission to reverse a ruling last year on sucralose had failed "in all material respects".

The ITC stuck by findings in September that the Chinese producers were not infringing Tate's patents for manufacturing technology used in making the zero-calorie sweetener.

The decision, which Tate conceded was the ITC's "final and binding determination", leaves a question mark over the profits the group can wring from sucralose, although the company said it was considering further appeals though the US courts.

Tate shares closed down 9.75p, or 3.4%, at 279.25p in London.

'Green light for Chinese factories'

Sucralose provided more than one-fifth of group underlying profits in 2007-08, and was expected to grow profits by more than 11% this year, analysts at UBS said last week.

Tate will now need to produce and export sucralose in direct competition with low-cost factories in developing nations.

Graham Jones, an analyst at Panmure Gordon, said the ITC ruling was a "green light for Chinese producers to increase capacity".

However, Karl Kramer, head of the group's sucralose operations, said that while the ITC's ruling was "disappointing", Tate had a "formidable competitive advantage" in sucralose.

"Our manufacturing facilities operate at a level of cost, efficiency and environmental stewardship surpassed by none," Mr Kramer said.