A Tale of Two Labels

Posted by Dana Johnson Downing on June 21, 2017 at 11:24 AM

iStock-517468826 labeling.jpg

On May 20, 2015, the U.S. Food and Drug Administration (FDA) finalized a rule to modernize the Nutrition Facts label for packaged foods. The FDA set compliance dates of July 26, 2017 for large companies to meet the new requirements, and an extra year for smaller companies to comply. Then-First Lady Michelle Obama lauded the announcement as a way to help families make healthier choices and reduce their risk of heart disease and obesity.

However, as of June 13, 2017, the modernized Nutrition Facts label faces an uncertain future. The FDA, now under the leadership of President Donald Trump’s administration, announced an indefinite delay in the implementation of the nutritional label changes. What a difference a year and a new president can make.

The new label was intended to help consumers more easily find calorie, serving size, and nutrient information to empower more informed dietary choices. Not everyone was enamored with the updated food labels. Food industry lobbying groups warned that the cost of these label changes would be passed on to consumers resulting in higher grocery bills for all Americas. Industry estimates are as high as $6,000 per SKU (stock keeping unit) for companies to make the necessary changes. To bring all food labels in compliance with the new label format could be as high as $1 billion and that’s just the beginning. There are several other labeling rules in the works at FDA and the U.S. Department of Agriculture, including labeling rules for menu, fiber, partially hydrogenated oils (PHOs), and genetically modified organisms (GMOs). With so many label changes on the horizon, the price tag for new labels could reach several billion.

Considering all the proposed and pending label changes announced last year, industry groups urged the Obama administration to harmonize the implementation dates so industry could comply with all of the new label changes at once rather than make back-to-back-to-back changes. When the new administration took over in January, the food industry was eager to learn if they would find a more sympathetic ear at the FDA with Trump appointees at the helm. They got their first glimpse of a pro-industry stance in May when the FDA announced it would postpone menu labeling and reopen the comment period. That announcement became the blueprint for the FDA’s announcement on June 13th to indefinitely delay the Nutrition Facts label updates.

With such an uncertain future for nutrition labeling requirements, where does that leave industry and consumers?

Many food companies moved swiftly and spent millions to meet the new standards. Under the new rule, food companies were forced to make numerous new calculations and create new labels for each and every product they sell, and sometimes that meant altering the product packaging as well. The ripple effect of these changes moved up the supply chain to ingredient suppliers because their customers (food manufacturers) are now demanding new nutritional data that was not previously required on label.

Some companies are disgusted that the FDA waited until this late date to announce the delay and feel as though they are paying an “early adopter’s penalty” for being prepared to meet the July 26, 2017 deadline. Other companies have made strategic decisions to voluntarily stay on course with their new label designs because they believe providing consumers with more information is a good business decision and will win them trust with their consumers. Other companies are relieved that the deadline is on hold because they were holding off making changes until the FDA issued guidance to industry on the new rules.

Thus, it appears that consumers will see both the new and old nutritional label formats for a while. Let’s look at the two formats.

Nutrition Label Side-by-side.jpg

According to the FDA’s website, the key updates include:

  • An updated design to highlight “calories” and “servings,” two important elements in making informed food choices.
  • Requirements for serving sizes that more closely reflect the amounts of food that people currently eat. What and how much people eat and drink has changed since the last serving size requirements were published in 1993. By law, the Nutrition Labeling and Education Act requires that serving sizes be based on what people actually eat.
  • Declaration of grams and a percent daily value (%DV) for “added sugars” to help consumers know how much sugar has been added to the product. It is difficult to meet nutrient needs while staying within calorie limits if you consume more than 10 percent of your total daily calories from added sugars, and this is consistent with the scientific evidence supporting the 2015-2020 Dietary Guidelines for Americans.
  • “Dual column” labels to indicate both “per serving” and “per package” calorie and nutrition information for certain multi-serving food products that could be consumed in one sitting or multiple sittings. Examples include a pint of ice cream and a 3-ounce bag of chips. With dual-column labels available, people will be able to easily understand how many calories and nutrients they are getting if they eat or drink the entire package/unit at one time.
  • For packages that are between one and two servings, such as a 20-ounce soda, the calories and other nutrients will be required to be labeled as one serving because people typically consume it in one sitting.
  • Updated daily values for nutrients like sodium, dietary fiber and vitamin D, consistent with Institute of Medicine recommendations and the 2015-2020 Dietary Guidelines for Americans. Daily values are reference amounts of nutrients to consume or not to exceed and are used to calculate the %DV that manufacturers include on the label.
  • Declaration of Vitamin D and potassium that will include the actual gram amount, in addition to the %DV. These are nutrients that some people are not getting enough of, which puts them at higher risk for chronic disease. The %DV for calcium and iron will continue to be required, along with the actual gram amount. Vitamins A and C will no longer be required because deficiencies of these vitamins are rare, but these nutrients can be included on a voluntary basis.
  • “Calories from Fat” will be removed because research shows the type of fat is more important than the amount. “Total Fat,” “Saturated Fat,” and “Trans Fat” will continue to be required.
  • An abbreviated footnote to better explain the %DV.

Regardless of what side of the nutritional labeling debate you are on, I imagine one thing on which we can all agree – consumers and food manufacturers, regulators and lobbyists, and even Democrats and Republicans – the process for making label updates is too complicated and costly. Even without the complexity of larger policy issues, it can be a very manual and error prone task to simply update a food label to reflect a slight change in a food manufacturer’s recipe or specifications. Even a change as simple as sourcing an ingredient from a new supplier could impact what needs to go on a label.

TraceGains cannot solve the political debate over labeling changes, but we are working to improve the process. Our software is helping revolutionize information exchange across the food supply chain by collecting and digitizing documents and data necessary to track food safety compliance, quality management, and supplier verification. We’ve teamed up with ESHA Research, Inc. – the makers of Genesis R&D food labeling software – to integrate our two systems to simplify the process for creating food labels and specifications by eliminating or reducing error-prone manual tasks and time wasted entering data into multiple systems. The TraceGains-Genesis integration will create a more accurate and efficient labeling process, while reducing costs for both large and small manufacturers.

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Tags: Labeling, FDA, Nutrition