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Manufacturers and consumers lose faith in natural label claims

11-Sep-2008

Food manufacturers are avoiding using the term natural because consumers have lost trust in the claim due to a lack of clear regulation in the US, according to a Packaged Facts report.

The definition of natural has become increasingly “fuzzy”, creating confusion, and the Food and Drug Administration (FDA) has shown a general reluctance to enter the fray over ‘what is natural’, said the study called Natural and Organic Food and Beverage Trends in the US.

Despite calls from the industry to regulate, no current federal rules legislate what constitutes a natural product and this has led to products with questionable natural credentials.

The report said: “Numerous natural/organic manufacturers stated in interviews for this report that they are avoiding using the term on labels, and instead relying on other value-added claims such as fair-trade, artisan and humanely raised.

“‘Natural’, they stated, only raises skepticism.”

An example of this is the controversial sweetener high fructose corn syrup (HFCS), which has sparked controversy and legal action over whether it is a ‘natural’ ingredient.

Last year, both Cadbury Schweppes and Kraft faced lawsuits after making 'natural' label claims on 7Up and Capri Sun that contained HFCS. Both companies changed the labeling of their products before any legal action was taken.

Then, in June a US federal judge rejected a claim by a consumer, that the use of the term 'all natural' on Snapple drinks was deceptive because the products contained HFCS. The court ruled that it was up to the FDA, not the court, to define 'natural'.

Similarly, Tyson Foods voluntarily withdrew claims on its labels that its chickens were 'raised without antibiotics' after it became the subject of regulatory debate and legal action.

Tyson qualified the claim to read 'chicken raised without antibiotics that impact antiobiotic resistance in humans' but it was again withdrawn this year by the company. Tyson said it wanted to preserve the integrity of its label and reputation and called for clear rules for labeling and advertising.

The report said such examples illustrated the complexity of regulation and competitive positioning in today’s marketplace, as well as the increasing importance of differentiating products and gaining consumers’ trust.

It said: “Industry leaders agree on the following basic understanding that natural products are minimally processed foods without any artificial ingredients, preservatives, colors or flavors.

“While a variety of manufacturers have been calling on the government to legislate rules for natural label claims, no immediate move is expected even as more and more conventional marketers promote their products as natural in ways that would not adhere to the above stated distinctions.”

It said that in contrast the United States Department of Agriculture National Organic Program has established an exhaustive definition on proper growing, processing and packing rules.

Packaged Facts estimates that total natural food sales will reach $12.9bn in 2008. It also predicts a 23 percent compounded annual growth rate for natural foods and beverages, with four-year growth expected to reach 86 percent.

The report said that the growth of natural products has been even stronger than the surge in organic. Also, consumers are increasingly seeking better-for-you alternatives to mainstream offerings and both segments have been benefiting greatly.

HFCS

The FDA has appeared to backtrack on its stance regarding HFCS. In April Geraldine June, supervisor of the product evaluation and labeling team at FDA's Office of Nutrition, Labeling and Dietary Supplements, responded to an enquiry made by FoodNavigator-USA.com saying "we would object to the use of the term 'natural' on a product containing HFCS", because it is produced using synthetic fixing agents.

However, in July the FDA, in a letter to the Corn Refiners Association, said that HFCS may be labeled natural when synthetic fixing agents do not come into contact with it during manufacturing. June said that when HFCS is made using this process, presented by Archer Daniels Midland Company, it can be considered natural.

The trade group Corn Refiners Association and numerous industry members have long maintained that HFCS is a natural sweetener. Meanwhile the Sugar Association industry group, as well as consumer groups such as the Center for Science in the Public Interest, maintain that HFCS cannot be considered natural because its chemical bonds are broken and rearranged in the manufacturing process.

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