Washington Insider -- Thursday

New Food Label Fight

Here’s a quick monitor of Washington farm and trade policy issues from DTN’s well-placed observer.

Perdue Addresses Rural Development, Budget and More With Lawmakers

Support for the McGovern-Dole and Food for Peace programs was expressed by USDA Secretary Sonny Perdue in his appearance at a Senate Appropriations subcommittee session, an apparent break with the Trump administration's Fiscal 2018 budget that proposed ending the McGovern-Dole effort specifically.

“I've admitted certainly on research and development, on rural development, on crop insurance and I think on this area, where I think the budget can benefit from some guidance,” Perdue said. He signaled he was asking "proving questions" on the effectiveness of the administration of the program, something the budget document raised questions about in terms of why they opted to propose eliminating funding for the effort.

The recent reorganization by Perdue of USDA's structure, to put a USDA Undersecretary for Trade in place at the expense of the Undersecretary for Rural Development, has also been a hot-button item with some lawmakers and groups. If the plan doesn't work, Perdue told lawmakers, he'd gladly put an Undersecretary for Rural Development in place if the new farm bill orders that to happen.

"If I don't make you proud of what we do with rural development over the next year, I'll be happy to have another undersecretary for rural development directed by the [2018] farm bill," Perdue stated.

USDA named Anne Hazlett, former chief counsel to the majority on the Senate Agriculture Committee, to the newly created position of assistant to the secretary for rural development Monday while there were still two days to go in the comment period on Perdue's reorganization plan.

China Approves Two New GMO Varieties, Renews Approvals For 14 Others

China has approved two new GMO crop varieties for import, -- Dow AgroSciences' Enlist corn and Monsanto's Vistive Gold soybeans – and has approved the renewal on 14 other varieties, according to the Chinese Ministry of Agriculture.

The renewals are for a three-year period to 2020, the ministry said. There are still other varieties awaiting approvals, including a DuPont Pioneer insect-tolerant corn while Dow AgroSciences' Enlist soybean is also pending approval.

The approvals come on the heels of a pledge by Chinese officials to improve their GMO crop approval process. No timeline has been laid out for any remaining approvals, but some expect they could come in the months ahead.

Washington Insider: New Food Label Fight

Well, there’s a new battle going on now and it involves proposed changes to nutrition labels for foods, the Washington Post reported today. It says following “sustained lobbying” from the packaged food and beverage industry, the Food and Drug Administration announced this week an indefinite delay in the launch of nutrition fact labels intended to help Americans eat more healthfully.

The labels, once championed by former first lady Michelle Obama, were poised to add a special line for “added sugars” and emphasize calorie content in large, bold text. They had been scheduled for rollout in July 2018, with a one-year extension for smaller manufacturers, the Post said.

This delay is the latest reversal of the Obama administration’s nutrition reforms under the current administration. On April 27, the FDA also delayed rules that would have required calorie counts on restaurant menus; then a week later, the Department of Agriculture loosened the minimum requirements for the amount of whole grain in school lunches and delayed future sodium reductions.

Consumer groups are calling the Nutrition Facts delay an attack on public health. The largest groups in the food industry, meanwhile, are celebrating what it calls a win for “common-sense” regulation.

However, the Post points out “another wrinkle.” As in the case of the menu-labeling delay, some companies have already adapted to the new rules, and they may be hurt if their competitors get more time to make the change.

Jim O’Hara, the director of health promotion policy at the Center for Science in the Public Interest, says that “just like with the menu-labeling delay, this administration is denying consumers critical information they need to make decisions, and it’s throwing the food industry into disarray.”

In addition, the Post says the debate over the Nutrition Facts deadline has exposed some “interesting schisms” in industry. While a number of large trade groups asked the FDA to delay implementation by three years, citing concerns about the cost of the labels, the lack of coordination between new label rules at FDA and USDA, and a lack of clarity around some requirements, others embraced the new panels, even printing them before they were required.

Among the early adopters are Nabisco/Mondelez, which has rolled the labels out on its Wheat Thins crackers; PepsiCo, which has put them on Lay’s chips, Fritos and Cheetos; and KIND, which makes granola bars.

Meanwhile, Mars Inc. — the maker of Uncle Ben’s rice, as well as dozens of candy brands, has vocally lobbied the FDA to stick to the original July 2018 deadline, citing consumers’ need for more health information.

Brad Figel, vice president of public affairs for Mars in North America, said the company had been devoting employees and resources to the new labels since they were finalized in 2016. And, several other large food companies have also begun designing and printing the labels, anticipating a 2018 deadline, the Post says.

Mars executives are concerned that the existence of two types of labels in the market will confuse consumers. “We support this because we believing in giving consumers more transparency,” Figel said.

That scenario is already beginning to play out in restaurants and grocery stores, where companies who scrambled to get calorie counts on their menus suddenly found themselves, as of late April, competing with chains who had done no such thing, the Post says.

California Pizza Kitchen has, for instance, already printed menus with nutritional information listed next to the price, according to Politico. At Pizza Hut, a competitor, calories are only labeled in a select number of stores and some pizza chains are making a desperate push to avoid posting calories on menus, the Post says.

This confusion doesn’t help consumers,” said O’Hara, of CSPI. “And ultimately it doesn’t help industry, either.”

Notably, this issue is not unknown to the FDA, the Post says. Stephen Ostroff, the deputy commissioner for foods and veterinary medicine, wrote last May that he was “pleased to see that some products in the marketplace already bear the new label.”

But in its updated guidance to industry, the agency appeared to side with food industry groups that argued implementation by July 2018 was impossible—and that “additional time would provide manufacturers covered by the rule with necessary guidance from FDA, and would help them be able to complete and print updated nutrition facts panels.”

So, it is clear that food labels are widely seen as important marketing tools that have significant costs and play a role in industry-wide competitive efforts. The new labels are more complex and likely will be more useful to larger companies. Whether or not consumers care much about the additional information they offer, the food advocates think they do. So, this fight is unlikely to end soon. And it is one producers should watch closely as it proceeds, Washington Insider believes.

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