How New Labeling Rules Might Impact the Food and Beverage Industry … in a Good Way
In an effort to create greater transparency, accountability and traceability in the food industry, Congress passed two game-changing pieces of legislation in 2016.
As the first major change to labeling requirements in nearly 20 years, food and beverage companies are looking for guidance on what these changes mean for their business and how to best implement the complex new regulations.
While a seemingly daunting task, food and beverage businesses have quite a few reasons to be excited about starting the implementation process. New technology, particularly blockchain, has the potential to not only help implement the new rules, but ultimately transform the consumer experience and create a more harmonious relationship between consumer, brand and product.
What are the new labeling regulations?
The two pieces of legislation aim to address the public’s growing desire to have more insight into the nutrition and ingredients that go into the products they consume. Here is an overview.
The National Bioengineered Food Disclosure Standard (NBFDS) tackles the mandatory labeling of genetically modified foods, or as they refer to as bioengineered (BE) food. Under the rule, food is considered BE if the major ingredient is genetically engineered and any BE food must be labeled with a symbol to signify the existence of BE ingredients.
On a broader scale, the Nutrition Facts Panel (NFP) Final Rule makes a sweeping change to virtually all nutritional food and beverage labeling, whether or not BE. The Food and Drug Administration (FDA) mandated that there be more specific nutritional labeling, including declarations of calories, sugars, daily reference values, percent daily values as well as a specific format on how to display the information. The overall goal of the legislation is to provide consumers with increased data and transparency to make better nutritional and health decisions.
The new labeling requirements must be implemented by Jan. 1, 2020 for all companies with annual sales equal to or greater than $10 million. Companies with sales under this threshold have an extra year to comply. With 2020 looming close on the horizon, tagging and labeling of all ingredients should begin immediately, even the smallest additions.
How can blockchain help?
While some food and beverage businesses may already adhere to strict labeling and ingredient tracking, others will find implementing these new changes extremely challenging. Meticulous recordkeeping and documentation will inherently change the way businesses approach processes and production. Gladly, blockchain can step in to help ease the burden and add extraordinary benefits in the process.
Essentially, blockchain is a growing list of records that are all linked using cryptography to create timestamps and track data with unfathomable accuracy. Blockchain has the ability to create an audit trail of every stage of a product’s development, from farm to shelf. For the food and beverage industry, this technology has the potential to trace all nutritional data and origins, connect supply chains and track every step of production for targeted recalls.
The opportunity to provide transparent information to consumers in a consistent manner is a massive differentiator and a major asset when it comes to sustaining brand loyalty and creating a positive consumer experience. Food and beverage companies could provide consumers with a blockchain verified label in the form of a QR code to scan and see a full background of where, how and when their food was created.
For products containing meat as their primary ingredient, blockchain can tag the origins and journey of the products from across the globe, including the ability to track and verify claims such as organic, grass-fed and natural. In the event of a recall, blockchain can identify contamination points and instantly track affected products and locations for quick resolution. Such targeted recalls can vastly decrease both cost and disruption to companies and their consumers.
While implementing the new labeling rules will certainly lead to many hurdles, the benefits of blockchain are quite vast and very exciting for companies choosing to jump in at the forefront of the health movement.