Dive Brief:
- The 9th U.S. Circuit Court of Appeals rejected a lawsuit that wanted labels on egg cartons to indicate the conditions in which the chickens were raised, according to the Associated Press.
- The plaintiffs, consisting of two animal advocacy groups and six egg consumers, asked that cartons contain terms such as “Free-Range Eggs,” “Cage-Free Eggs” or “Eggs from Caged Hens.” The groups said caged hens were nutritionally inferior and carried a greater risk of salmonella. The U.S. Food and Drug Administration argued there was not persuasive evidence to back those claims.
- A three-judge panel ruled that several federal agencies had acted reasonably in rejecting the labeling regulations.
Dive Insight:
Consumers are more interested than ever to know where their food comes from and under what conditions it was made. Many manufacturers are doing their part to be more transparent with shoppers by offering cleaner labels and easier-to-understand information on packages.
Numerous manufacturers have started using the Grocery Manufacturers Association's SmartLabel to not only disclose genetically modified ingredients but share nearly 360 other product and company attributes—a good beginning in the eyes of many consumers.
Retailers discovered the value in cage-free egg production in 2015, when the avian flu forced the traditional egg supply to dwindle. This led to an increase in demand for cage-free eggs among consumers.
Many food manufactures and retailers, including Kraft Heinz, General Mills and Whole Foods, have made changes to their egg supply or announced plans to switch all or a portion of their egg purchases to cage-free. Stores like Kroger have found some success with private label cage-free eggs.
The challenge is that as these companies make the transition and demand more of these eggs in the coming years, the $10 billion egg industry will have to spend millions of dollars to upgrade their operations to meet these new standards. Those additional costs could be paid for by consumers. And with all the companies moving to cage-free eggs, there also is a possibility that demand could exceed supply if the industry transition doesn't happen quickly enough.