The Prevalence of the “Natural” Claim on Food Product Packaging

Fred Kuchler, Megan Sweitzer and Carolyn Chelius

No 340804, Economic Brief from United States Department of Agriculture, Economic Research Service

Abstract: U.S. food suppliers make claims about their production processes on food packaging that highlight attributes some consumers want while charging a higher price than for unlabeled products. Some labels use such claims as “USDA Organic” and “raised without antibiotics,” which require different and more expensive production techniques than conventional agriculture. However, food suppliers can use the label that claims the food is “natural” at a relatively low cost because regulatory agencies treat the claim as meaning nothing artificial was added and the product was minimally processed. Numerous consumer food choice studies concluded that consumers equate the natural label on food with healthier food choices and more costly production practices that signify environmental stewardship. Informed by these previous studies’ findings, the authors of this report estimate the frequency with which food suppliers make the natural claim on food packaging labels. Estimates are based on scanner data and comprehensive label data. Across all foods in 2018, 16.3 percent of retail food expenditures and 16.9 percent of all items purchased (unit sales) were for foods labeled natural, whereas 11.0 percent of Universal Product Codes (UPC) in stores were labeled natural on the packaging. Expenditures for food labeled natural were larger than expenditures for foods labeled USDA Organic. Natural labels were found predominately on processed products. For example, 95.6 percent of expenditures for vitamins and meal supplements were for products labeled natural, compared with 0.5 percent of expenditures for potatoes.

Keywords: Agricultural and Food Policy; Crop Production/Industries; Environmental Economics and Policy; Food Consumption/Nutrition/Food Safety; Health Economics and Policy; Livestock Production/Industries; Marketing (search for similar items in EconPapers)
Pages: 14
Date: 2023-05
New Economics Papers: this item is included in nep-agr, nep-env and nep-inv
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Persistent link: https://EconPapers.repec.org/RePEc:ags:uerseb:340804

DOI: 10.22004/ag.econ.340804

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