By Annie Gasparro and Mike Esterl 

U.S. food regulators approved the most radical overhaul of nutrition policy in decades, putting sugar squarely in their crosshairs in an attempt to change how Americans eat and drink.

The U.S. Food and Drug Administration said a new nutrition-facts panel that appears on the back of all packaged food and beverages will list how many grams of sugar have been added by manufacturers and what percentage of the recommended daily maximum that represents.

The FDA's decision to break out added sugar from the total sugar count already on packaging culminates a yearslong push by the Obama administration into stiff opposition from food and beverage companies, which say there is no difference between naturally present sugars and added sugars.

Health officials say added sugars -- such as corn sweetener -- have no nutritional value and increase overall caloric intake, helping fuel obesity and diabetes while steering Americans away from nutrient-rich foods. Until now, nutrition panels have flagged recommended maximums for fats, sodium, cholesterol and carbohydrates but not for sugar.

First lady Michelle Obama will announce the changes in an annual nutrition summit in Washington.

The new rules aimed at cracking down on the country's sweet tooth could cause label shock for many consumers, and it is expected to deal a big blow to food and beverage makers, especially those in the soft-drink industry. A 20-ounce bottle of Coke, for instance, contains about 130% of the daily recommended maximum for added sugar.

Despite increasingly branching out into bottled waters and other zero-calorie offerings, Coca-Cola Co. still derives about 70% of its sales from carbonated soft drinks like Coke, Sprite and Fanta.

Government health officials recommend eating no more than 50 grams of added sugars -- or 12.5 teaspoons of granulated sugar -- a day, based on a 2,000 calorie diet. However, the FDA estimates Americans on average eat the equivalent of 20 teaspoons of granulated sugar through added sugars like honey, high fructose corn syrup and other sweeteners.

One serving of low-fat vanilla yogurt can have three to four teaspoons of added sugar per serving, in addition to the natural sugar from the milk. Flavored oatmeal also can have as many as three teaspoons of added sugar.

Even savory foods have added sugar, like pasta sauce, which often has 10% of the recommended daily intake per serving.

The new label regulations don't apply to certain meat, poultry and processed egg products, which are regulated by the U.S. Department of Agriculture, not the FDA.

According to the government, the biggest sources of added sugars are the obvious ones: in descending order, soda, energy and sports drinks, grain-based desserts, sugar-sweetened fruit drinks, dairy-based desserts and candy.

The spotlight on sugar could damage sales, pushing dozens of major companies -- including General Mills Inc., PepsiCo Inc., Campbell Soup Co. and Coca-Cola -- to further reformulate products. Many already are wrestling with falling demand for processed foods and sugary drinks as consumers shop for fresher, healthier alternatives.

Soda producers also are being targeted by local politicians. Philadelphia's mayor has proposed a tax of 3 cents per ounce on sugar-added drinks, potentially increasing prices by more than half, and lawmakers in Illinois have resurrected the idea of a soda tax in their budget talks. In July, San Francisco will begin requiring advertisements for sugary drinks to be accompanied by warnings that they contribute to obesity, diabetes and tooth decay.

The FDA proposed initial changes to the nutrition label in early 2014, sparking thousands of letters from interested parties, including food and beverage companies. It first proposed including the recommended maximum daily percentage for added sugars last summer.

Until now, nutritional labels have remained essentially unchanged since 1994, except for the addition of heart-risky trans fats in 2006.

Manufacturers have two years to comply with the new regulation, though they could still challenge the changes in court. Those with less than $10 million in annual food sales will have three years.

The new panels also will require some companies to change the serving sizes they list on the back of the package. Ice cream, which can now list half a cup as one serving, will list two-thirds of a cup as a serving, increasing the calorie count that appears on the label by a third.

Among other changes, manufacturers will be required to declare the amounts of potassium and vitamin D because the FDA says Americans aren't getting enough, putting them at higher risk for chronic disease. But they will no longer be required to list vitamin A and vitamin C because most people are getting their fill.

The updated label design also makes calories and serving sizes more prominent.

But it is the inclusion of added sugars that has sparked the most debate and represents the most dramatic shift from the 1990s, when many health experts were more focused on getting Americans to cut back on fat.

It also comes at a time when Americans are reading labels more carefully than ever before. Some 77% of U.S. adults read them when buying food. Fewer than half read them in 2002, even when they purchased a product for the first time, according to the government.

The new label regulations don't apply to certain meat, poultry and processed egg products, which are regulated by the U.S. Department of Agriculture, not the FDA.

The Grocery Manufacturers Association, a trade group representing major food and beverage companies, argues that distinguishing between added and natural sugar on labels is unnecessary because they have the same impact on weight gain. It says scientific tests also can't tell the difference, making it difficult to measure how much added sugar is in a food or drink.

Many Americans already have scaled back on sugar in recent years, prompting changes at food and beverage makers.

General Mills reduced sugar in its regular Yoplait yogurt by 25% last year. Danone SA's Dannon has cut sugar in its various yogurt brands, and says three-quarters of its sales now come from products with 23 grams or less of sugar. Both companies said the shift was costly, taking years of research and development, testing in focus groups and securing different ingredients.

"We had to figure out how to make the base yogurt less tart and change some of the flavors we added," a Dannon spokesman said.

Mizkan America Inc.'s Ragu came out with a pasta sauce that boasts no added sugar. J.M. Smucker Co. has a line of all-natural peanut butter with no added sugar. And Mott's LLP sells an all-natural applesauce with half the sugar of its original applesauce.

But there are limits. Coke and Pepsi both expected consumers to shift from full-calorie sodas to their zero-calorie offerings. Sales of diet sodas instead have fallen more quickly than regular soda in recent years as Americans balked at artificial sweeteners over health concerns. Both companies recently launched mid-calorie colas sweetened with stevia, which is derived from a plant, but consumers have largely stayed away.

Interpreting the new rules governing added sugars also could prove thorny as companies challenge what constitutes an added sugar.

Ocean Spray Cranberries Inc. markets one of its cranberry juice blends as having "no added sugar" on packaging. Cranberries aren't naturally sweet, but the blend lists ingredients that are sweet, including grape, apple and pear juice concentrates.

Ocean Spray says the non-cranberry concentrates create a unique flavor. Under the new rules, though, Ocean Spray could be required to treat them as added sugars.

The FDA on Friday provided a long list of examples of added sugars, including corn sweetener, malt sugar and molasses. It said frozen fruit juice concentrates from 100% juice won't be treated as an added sugar but that fruit juice concentrates not reconstituted to full strength will be treated as such.

Write to Annie Gasparro at annie.gasparro@wsj.com and Mike Esterl at mike.esterl@wsj.com

 

(END) Dow Jones Newswires

May 20, 2016 11:54 ET (15:54 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
Coca Cola (NYSE:KO)
Historical Stock Chart
From Feb 2024 to Mar 2024 Click Here for more Coca Cola Charts.
Coca Cola (NYSE:KO)
Historical Stock Chart
From Mar 2023 to Mar 2024 Click Here for more Coca Cola Charts.