Packaged Facts: The Trickle-Down Effect of Vermont's GMO Labeling Law on U.S. Food Industry

General Mills' GMO labeling announcement puts company ahead of the curve with consumers

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Mar 23, 2016, 12:48 ET

ROCKVILLE, Md., March 23, 2016 /PRNewswire/ -- For all the headlines and hubbub surrounding genetically modified organisms, any lasting action to fiercely regulate foods containing GMOs has been relatively paltry by comparison. That is likely about to change. A law in Vermont is already having a noteworthy ripple effect on how at least one major food company plans to label its products going forward. The law mandates that food packages in the state must include GMO labeling on July 1.

Late last week General Mills Inc announced intentions to begin labeling U.S. products that contain GMOs. Previously in January 2014, General Mills made national headlines on the GMO front when it announced it would stop using GMOs in its original (yellow box) Cheerios cereal, subsequently becoming the first major brand of packaged food in the United States to begin marketing itself as non-GMO. However, this latest announcement by General Mills to label products due to a now mandatory state law carries entirely different connotations for both the company and the U.S. food industry overall, notes Packaged Facts, a Maryland-based market research publisher. Packaged Facts has published studies on the topic of GMOs, including the 2015 reports Non-GMO Foods: U.S. and Global Market Perspective, 2nd Edition and Nutritional Labeling and Clean Labels in the U.S.: Future of Food Retailing.

Many consumers and consumer advocates want mandatory labeling of GMOs in foods and beverages. Over the past few years, more than 70 bills related to GMO labeling have been introduced in 30 states. In several states, GMOs have also been the topics of widely publicized ballot initiatives. It was in 2014 that Vermont became the first state to require GMO labeling—with intentions for the law to go into effect this year once it survived the obligatory legal challenges from the food industry. Connecticut and Maine passed laws earlier that mandate GMO labeling, but those laws cannot be implemented until other neighboring states enact similar laws.

Millions of dollars have been spent by the U.S. food industry fighting mandatory GMO labeling attempts on both the state and federal levels despite consumer demand for increased transparency regarding what is in their food. Amid increased negative publicity about GMOs, surveys show that a growing number of U.S. consumers are concerned about GMOs in their food—even when they don't really understand what GMOs are. For instance, a February 2016 Packaged Facts survey found that more than a quarter (26%) of U.S. adults say non-GMOs labeling is an especially important factor when choosing the food they eat.

Even beyond GMOs, consumer demand for free-from products is rising in general. Packaged Facts' January 2015 consumer survey found that label statements about the absence of certain ingredients are important to 69% of consumers, and 61% agree that there are specific ingredients they avoid and make sure aren't present in the packaged foods they buy. Relatedly, regarding GMOs specifically, almost half (46%) of consumers are looking for foods without genetically modified organisms.

The trend for avoiding specific ingredients is especially apparent among Millennials. Though General Mills' GMO labeling stems from mandatory regulation, Packaged Facts believes the company's decision to embrace rather than fight the requirement will ultimately endear it to younger consumers in particular and will bode well for the company looking forward. Don't be surprised when other companies inevitably follow General Mills' lead, notes Sprinkle.

"Manufacturers may be in the driver's seat when it comes to information on labels," says Sprinkle, "but when it comes to the Millennial-driven demands for fuller information on product sourcing, processing, ingredients, and packaging, consumers are increasingly calling the shots. Manufacturers who don't provide the desired transparency--or the right answers--will lose out to competitors who do."

Further insights pertaining to Non-GMO Foods: U.S. and Global Market Perspective, 2nd Edition can be found on Packaged Facts' website at: http://www.packagedfacts.com/redirect.asp?progid=88512&productid=8775964.

For more information on Nutritional Labeling and Clean Labels in the U.S.: Future of Food Retailing, including the abstract and table of contents, visit: http://www.packagedfacts.com/redirect.asp?progid=88511&productid=8953224.

About Packaged Facts – Packaged Facts, a division of MarketResearch.com, publishes market intelligence on a wide range of consumer market topics, including consumer demographics and shopper insights, consumer financial products and services, consumer goods and retailing, consumer packaged goods, and pet products and services. Packaged Facts also offers a full range of custom research services. Reports can be purchased at www.PackagedFacts.com and are also available on www.marketresearch.com and www.profound.com.

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SOURCE Packaged Facts