[Federal Register: January 18, 2001 (Volume 66, Number 12)]
[Proposed Rules]
[Page 4969-4999]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr18ja01-39]
[[Page 4969]]
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Part IV
Department of Agriculture
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Food Safety and Inspection Service
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9 CFR Parts 317 and 381
Nutrition Labeling of Ground or Chopped Meat and Poultry Products and
Single-Ingredient Products; Proposed Rule
[[Page 4970]]
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DEPARTMENT OF AGRICULTURE
Food Safety and Inspection Service
9 CFR Parts 317 and 381
[Docket No. 98-005P]
RIN 0583-AC60
Nutrition Labeling of Ground or Chopped Meat and Poultry Products
and Single-Ingredient Products
AGENCY: Food Safety and Inspection Service, USDA.
ACTION: Proposed rule.
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SUMMARY: The Food Safety and Inspection Service (FSIS) is proposing to
amend the Federal meat and poultry products inspection regulations to
require nutrition labeling of the major cuts of single-ingredient, raw
meat and poultry products, unless an exemption applies. For these
products, FSIS is proposing to make the guidelines currently in place
for the voluntary nutrition labeling program mandatory. Thus, the
Agency is proposing to require that nutrition information be provided
for these products either on their label or at their point-of-purchase.
During the most recent surveys of retail stores, the Agency did not
find significant participation in its voluntary nutrition labeling
program, which covers the major cuts of single-ingredient, raw
products. Without nutrition information for these products, the Agency
has tentatively concluded that the major cuts of single-ingredient, raw
meat and poultry products would be misbranded under the Federal Meat
Inspection Act and the Poultry Products Inspection Act.
FSIS is also proposing to amend its regulations to require
nutrition labels on all ground or chopped meat and poultry products,
with or without added seasonings, unless an exemption applies. Under
existing regulations, multi-ingredient ground or chopped products,
(e.g., ground pork with seasonings), and heat processed ground or
chopped products (e.g., fully cooked or partially cooked patties) are
required to be nutritionally labeled, unless they qualify for an
exemption, but single-ingredient, raw ground or chopped products are
not required to be so labeled. Without nutrition information for
single-ingredient, raw ground or chopped products, the Agency has
tentatively concluded that these products would be misbranded under the
Federal Meat Inspection Act and the Poultry Products Inspection Act.
The Agency has also tentatively determined that single-ingredient, raw
ground or chopped meat and poultry products are different from other
single-ingredient, raw meat and poultry products in several important
respects. Thus, FSIS is proposing to make nutrition labeling
requirements for all ground or chopped meat and poultry products
consistent with those currently required for products in the mandatory
nutrition labeling program (multi-ingredient and heat processed
products).
FSIS is proposing to require nutrition labels on packages of
single-ingredient, raw ground or chopped products, rather than at their
point-of-purchase, largely because these products are similar to
products in the mandatory nutrition labeling program (which requires
nutrition information to be on the label of individual packages), in
that certain parameters, such as their fat content, can be controlled
precisely to obtain the desired product. Although FSIS believes that
nutrition information on labels of individual packages of single-
ingredient, raw products is useful, FSIS is proposing that nutrition
information for the major cuts of single-ingredient, raw products may
also be provided on point-of-purchase materials because FSIS believes
that consumers have reasonable expectations as to the nutrient content
of these products, the nutrient content of a specific major cut is
relatively uniform across the market, and because these products are
not formulated in the manner of ground or chopped products. For single-
ingredient, raw products that are not major cuts and that are not
ground or chopped, FSIS is not proposing to require nutrition
information on their labels or at their point-of-purchase because FSIS
has not yet assessed whether adequate nutrition information is being
provided for these products and, therefore, has not determined whether
it would be beneficial to require nutrition labeling for these
products.
Finally, FSIS is proposing to amend the nutrition labeling
regulations to provide that when a ground or chopped product does not
meet the criteria to be labeled ``low fat,'' a lean percentage claim
may be included on the label or in labeling as long as a statement of
the fat percentage also is displayed on the label or in labeling.
DATES: Comments must be received on or before April 18, 2001.
ADDRESSES: Submit one original and two copies of comments to FSIS
Docket Clerk, Docket #98-005P, Food Safety and Inspection Service, Room
102, Cotton Annex, 300 12th Street, SW, Washington, DC 20250-3700.
Reference material cited in the document and any comments received will
be available for public inspection in the FSIS Docket Room from 8:30
a.m. to 4:30 p.m., Monday through Friday.
FOR FURTHER INFORMATION CONTACT: Dr. Robert Post, Director, Labeling
and Additives Policy Division, Office of Policy, Program Development,
and Evaluation, Food Safety and Inspection Service, U.S. Department of
Agriculture, Washington, DC 20250-3700; (202) 205-0279.
SUPPLEMENTARY INFORMATION:
Background
The Current Mandatory and Voluntary Nutrition Labeling Programs
Mandatory nutrition labeling program. The Nutrition Labeling and
Education Act (NLEA) of 1990 required nutrition labeling of most foods
regulated by the Food and Drug Administration (FDA). FSIS published
regulations establishing comparable nutrition labeling requirements for
meat and poultry products. As explained in its proposed and final
rules, FSIS determined that it had statutory authority to require
nutrition labeling based on the Secretary of Agriculture's
determination that meat and poultry products, other than single-
ingredient, raw products, would be misbranded in the absence of such
information, under section 1(n) of the Federal Meat Inspection Act
(FMIA) (21 U.S.C. 601(n)(1)) and section 4(h)(1) of the Poultry
Products Inspection Act (PPIA) (21 U.S.C. 453(h)(1)) (56 FR 60305 and
58 FR 637). These statutory provisions state that a product is
misbranded if it is false or misleading in any particular. FSIS
published an advance notice of proposed rulemaking on nutrition
labeling of meat and poultry products on April 2, 1991 (56 FR 13564), a
proposed rule on November 27, 1991 (56 FR 60302), a final rule on
January 6, 1993 (58 FR 632), and subsequently other amendments to the
rule.
FSIS' regulations require nutrition labels on the packages of all
multi-ingredient and heat processed meat and poultry products, unless
an exemption applies. The required nutrition labeling provisions are
referred to as ``the mandatory nutrition labeling program.'' The
regulations include exemptions from nutrition labeling requirements for
food products produced by small businesses, products intended for
further processing, products not offered for sale to consumers,
products in small packages that are individually wrapped packages of
less than \1/2\ ounce net weight, custom slaughtered or prepared
products, products intended for export, ready-to-eat products that are
packaged
[[Page 4971]]
or portioned at a retail store or similar retail-type establishment,
and multi-ingredient products processed at a retail store or similar
retail-type establishment. The regulations also provide that nutrition
labeling may be provided by alternate means for packages that have a
total surface area available to bear labeling of less than 12 square
inches; for these products, the regulations permit manufacturers to
provide an address or telephone number on the package for consumers to
write or call for nutrition information. Except for the nutrition
labeling exemptions for custom slaughtered or prepared products and
products intended for export, the exemptions from nutrition labeling
requirements and the provision for alternate means of providing
nutrition labeling on packages that have a limited surface area to bear
labeling apply only when a product's labeling includes no nutrition
claims or nutrition information. The regulations also state that
restaurant menus generally do not constitute nutrition labeling or fall
within the scope of the nutrition labeling regulations, and that foods
represented or purported to be specifically for infants and children
less than 4 years of age shall not include certain nutrient content
declarations (see Secs. 317.400 and 381.500).
The regulations specify the information that must be included on
the labels of products in the mandatory nutrition labeling program. The
required information includes the levels of total calories, calories
from fat, total fat, saturated fat, cholesterol, sodium, total
carbohydrate, dietary fiber, sugars, protein, and certain vitamins and
minerals in the product. In certain situations, information concerning
some of these nutrients is not required. For example, the label
declaration of ``calories from fat'' is not required on products that
contain less than 0.5 gram of fat per serving. The regulations also
provide that information concerning stearic acid, polyunsaturated fat,
monounsaturated fat, potassium, soluble fiber, insoluble fiber, sugar
alcohol, other carbohydrates, and calories from saturated fat may be
included voluntarily. When claims related to these nutrients are made,
or when certain related nutrients are declared, information concerning
these nutrients is required.
The regulations require that the nutrient and food component
quantities on the label of products in the mandatory nutrition labeling
program be declared in relation to a serving. The regulations also
require that the declaration of nutrient and food component content be
on the basis of the product ``as packaged''; in addition, the
declaration of nutrient and food component content may also be made on
the basis of ``as consumed,'' provided that preparation and cooking
instructions are clearly stated. The regulations also prescribe format
requirements for nutrient information, which include specified headings
that must be used in the presentation of nutrition labeling
information.
The regulations include provisions for Agency monitoring of
compliance with the mandatory nutrition labeling requirements. FSIS
conducts a continuous product sampling program to ensure compliance
with nutrition labeling requirements (see Secs. 317.309(h)(1)-(8) and
381.409(h)(1)-(8)).
Voluntary nutrition labeling program. In the preamble to the
January 6, 1993, final rule, FSIS stated that it would not require
nutrition labeling for single-ingredient, raw meat and poultry products
because the nutrient values of these products are not modified through
various stages of preparation, such as cooking and heat processing.
Therefore, the Agency believed that consumers had reasonable
expectations as to the nutritional qualities of these products (58 FR
637). In the preamble to the proposed rule, FSIS also stated that
nutrition information for single-ingredient, raw products was available
to consumers through other means such as the extension service, grocery
stores, and trade associations (56 FR 60306). For these reasons,
although the Agency adopted a mandatory nutrition labeling program for
multi-ingredient products and heat processed products, it chose not to
do so for single-ingredient, raw meat and poultry products, including
single-ingredient, raw ground or chopped products. Instead, it
established guidelines for voluntary nutrition labeling of these
products (see Secs. 317.345 and 381.445).
Under the voluntary nutrition labeling program, retailers and
manufacturers are not required to provide nutrition information for
single-ingredient, raw meat or poultry products. Instead, retailers and
manufacturers voluntarily may provide nutrition information on the
label of these products, or at their point-of-purchase by posting a
sign or by making the information readily available in brochures,
notebooks, or leaflet form in close proximity to the food. However, if
a nutrition claim is made on these materials, all of the requirements
of the mandatory nutrition labeling program apply.
If only nutrition information, and not a nutrition claim, is
supplied on the point-of-purchase materials of single-ingredient, raw
products, the requirements of the mandatory program apply, but the
nutrition information may be supplied on an ``as packaged'' or ``as
consumed basis''; the listing of percent of Daily Value for certain
nutrients and the footnote explaining that the Daily Values are based
on a 2,000 calorie diet and that daily values may differ depending on
calorie needs (see Secs. 317.309(d)(9) and 381.409 (d)(9)) may be
omitted; and the point-of-purchase materials are not subject to any
format requirements.
If, however, a retailer or manufacturer provides nutrition
information on the label of single-ingredient, raw products, this
information must be presented in the same format as that prescribed for
mandatory nutrition labeling of various products. However, for these
products, unlike products in the mandatory nutrition labeling program,
the nutrition information may be declared on the basis of either ``as
consumed'' or ``as packaged.'' If the information is presented on the
basis of ``as consumed,'' the regulations provide that the methods used
to cook the product must be specified and should be those which do not
add nutrients from other ingredients (see Secs. 317.345(d) and
381.445(d)). Also, unlike products in the mandatory program, the
declaration of the number of servings per container need not be
included on the nutrition label.
The regulations provide that the Agency will not conduct compliance
sampling and testing of a product subject to the voluntary nutrition
labeling program that contains nutrition labeling if the nutrition
labeling is based upon the most current representative data base values
contained in USDA's National Nutrient Data Bank or in its published
form, the Agriculture Handbook No. 8 series, and if there are no
nutrition claims made on the basis of the representative database
values on the labeling of these products (Secs. 317.309(h)(9),
317.345(e), 317.345(f), 381.409(h)(9), 381.445(e), and 381.445(f)).
The Agriculture Handbook No. 8 series is now out of print. The
current released form of the USDA's National Nutrient Data Bank is the
USDA Nutrient Database for Standard Reference. USDA's Nutrient Data
Bank is the Agricultural Research Service's internal system that stores
information and has features necessary to produce the released
database. The USDA Nutrient Database for Standard Reference is
developed and maintained by the Agricultural Research Service and can
be found on the internet at the
[[Page 4972]]
following address: http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.nal.usda.gov/fnic/foodcomp.
The Agency may conduct sampling and testing for compliance with
nutrition labeling requirements for single-ingredient, raw meat and
poultry products if the nutrition information on their labeling is not
based on the latest values contained in USDA's National Nutrient Data
Bank or the USDA Nutrient Database for Standard Reference, or if there
are nutrition claims made on the basis of the representative database
values, on the labeling of these products.
Compliance with voluntary nutrition labeling guidelines. FSIS'
regulations provide that the Agency monitor compliance with its
voluntary nutrition labeling program guidelines by evaluating the
participation of retailers in the voluntary program every two years,
beginning in May 1995, to determine whether significant participation
of at least 60 percent of all companies evaluated exists (Secs. 317.343
and 381.443). FSIS stated that it would issue its first report of its
survey findings on the voluntary program by May 1995, and that it would
reevaluate every two years after 1995 whether significant participation
existed in the voluntary nutrition labeling program (56 FR 60306).
FSIS regulations provide that a food retailer is participating at a
significant level (1) if the retailer provides nutrition labeling
information for at least 90 percent of the major cuts of single-
ingredient, raw meat and poultry products it sells; and (2) if the
nutrition label on these products is consistent in content and format
with the mandatory program, or if nutrition information is displayed at
point-of-purchase in an appropriate manner. The regulations provide
that significant participation by food retailers exists if at least 60
percent of all companies that are evaluated are participating in
accordance with the guidelines. The regulations provide that the
voluntary nutrition labeling program will remain in effect as long as
there is significant participation in the voluntary program by retail
stores (Secs. 317.343 and 381.443).
FSIS contracted with an independent market research contracting
firm to conduct the retail surveys in 1995, 1996, and 1999. For each of
these surveys, the firm surveyed a nationally representative sample of
approximately 2,000 retail stores to obtain the information necessary
to assess compliance with the guidelines for voluntary nutrition
labeling of single-ingredient, raw meat and poultry products.
The first survey to determine participation by retail stores in the
voluntary nutrition labeling program was conducted in June 1995. At
that time, the National Retail Tracking Index, Inc., found that 66.5
percent of the stores surveyed were providing nutrition information on
90 percent of the major cuts of single-ingredient, raw meat and poultry
products. Therefore, this survey showed that significant participation
in the voluntary nutrition labeling program existed. FSIS published a
notice of availability of the survey results in the January 29, 1996
Federal Register (61 FR 2790). In this survey, stores were counted as
participating in the voluntary nutrition labeling program if they used
point-of-purchase materials developed by the Food Marketing Institute
(FMI) prior to the 1993 final rule on nutrition labeling of meat and
poultry products. These materials did not comply entirely with the
voluntary nutrition labeling program provisions in the 1993 final rule.
For example, the older materials did not include the required percent
daily values for certain nutrients. Therefore, the results of this
survey may overestimate participation in the voluntary nutrition
labeling program.
The second survey was conducted in mid-December 1996. FSIS
conducted it jointly with FDA. For this survey, the two agencies
contracted with the firm that conducted the 1995 FSIS survey, now named
Retail Diagnostics, Incorporated (RDI). At this time, RDI found that
57.7 percent of stores surveyed provided nutrition information for 90
percent of the major cuts of single-ingredient, raw meat and poultry
products, in accordance with program guidelines. The third survey was
conducted in October 1999. At this time, RDI found that 54.8 percent of
stores surveyed provided nutrition information for 90 percent of the
major cuts of single-ingredient, raw meat and poultry products, in
accordance with program guidelines. Therefore, the two most recent
surveys did not show significant participation in the voluntary
nutrition labeling program, according to the voluntary nutrition
labeling program regulations. Reports on the 1996 and 1999 surveys are
available electronically on the FSIS web page at http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.fsis.usda.gov.
Nutrient Content Claims
In addition to establishing the mandatory and voluntary nutrition
labeling programs, the January 6, 1993, final rule provided definitions
at Secs. 317.362 and 381.462 for specific nutrient content claims,
including the terms ``lean'' and ``extra lean.'' The definitions of
``lean'' and ``extra lean'' provide that these terms may be used on the
label or in labeling only if the product meets certain criteria (see
Secs. 317.362(e)(1) and (2) and 381.462(e)(1) and (2)). Meat products
may be labeled ``lean'' if they contain less than 10 grams of fat, 4.5
grams or less of saturated fat, and less than 95 milligrams of
cholesterol per 100 grams of product and per reference amount
customarily consumed for individual foods. Meat products may be labeled
``extra lean'' if they contain less than 5 grams of fat, less than 2
grams of saturated fat, and less than 95 milligrams of cholesterol per
100 grams of product and per reference amount customarily consumed for
individual foods. Ground beef and hamburger seldom meet the criteria
that would allow producers to use the terms ``lean'' or ``extra lean''
on the label or in labeling of these products.
The existing nutrition labeling regulations also provide that the
term ``____ percent lean'' is a synonym for the term ``____ percent fat
free,'' and that, in order for either term to be used on the label or
in labeling of the product, the product must meet the criteria for
``low fat'' (Secs. 317.362(b)(6) and 381.462(b)(6)). To meet the
criteria for ``low fat,'' a product must have a reference amount
customarily consumed greater than 30 grams or greater than 2
tablespoons and must contain 3 grams of fat or less per reference
amount customarily consumed for individual foods, or must have a
reference amount customarily consumed of 30 grams or less or 2
tablespoons or less and must contain 3 grams or less of fat per
reference amount customarily consumed and per 50 grams
(Secs. 317.362(b)(2) and 381.462(b)(2)). Most ground beef and hamburger
do not qualify as ``low fat.'' Therefore, existing regulations preclude
the use of the term ``____ percent lean'' on these products.
On May 24, 1994 (59 FR 26916), FSIS published a proposed rule
entitled ``Nutrition Labeling of Ground Beef and Hamburger.'' In the
preamble to the proposal, FSIS explained that the Agency had determined
that, although the existing regulations precluded producers of ground
beef and hamburger from using the terms ``lean,'' ``extra lean,'' and
``____ percent lean,'' these products should be labeled to permit
consumers to readily identify and differentiate between the varying
lean to fat ratios in such products. The Agency also stated that
allowing such labeling would assist consumers in selecting leaner
versions of these products and would provide an incentive for
manufacturers to market products lower in fat. Finally, FSIS
[[Page 4973]]
recognized that many producers had been using lean percentages on the
labeling of ground beef and hamburger products for a significant period
of time (59 FR 26917).
Accordingly, FSIS proposed to amend its regulations to permit the
use of percentage labeling for lean and fat on ground beef and
hamburger products. Under this proposal, FSIS would have permitted a
statement of the lean percentage on the labeling of ground beef and
hamburger if it were contiguous to a statement of the fat percentage.
The Agency would have allowed this labeling even when the ground beef
or hamburger did not qualify as ``low fat.'' The Agency proposed to
allow the use of the statement of lean and fat percentages only if the
product were accompanied by nutrition information presented on the
label, or in point-of-purchase materials in close proximity to the
product. FSIS stated that it would consider expanding the proposed
percentage labeling to ground meat from other species and to ground
poultry if information submitted during the comment period demonstrated
the need and consumer acceptability of these terms for such products or
that differential treatment of ground beef relative to other ground
products would inappropriately restrict informed consumer choice (59 FR
26918).
The Agency received a total of 2,732 comments on this proposal.
Fifty-five percent (1,504) of the commenters supported the proposal, 39
percent (1,063) opposed it, and 6 percent (165) addressed issues
outside the scope of the proposed rule. Supporters of the proposal
included trade associations representing food manufacturers and
retailers, food manufacturers of both meat and poultry products, a
large number of retailers, and State departments of agriculture.
Supporters stated that percentage labeling provides useful information
to consumers, that ``lean labeling'' aids consumers in selecting lower
fat products, and that percentage labeling has been in use for more
than 20 years. Opponents included consumer interest groups, health
professionals and organizations, and consumers. They stated that the
use of percent lean labeling is inherently misleading to consumers and
will cause consumers to view ground beef as ``lean'' or ``low fat.''
Twenty-one of the 1,504 commenters who supported the provisions
wanted them to also apply to other species or products. These
commenters stated that allowing percentage labeling for lean and fat
for other ground meat and poultry products, besides ground beef and
hamburger, would allow consumers to compare the fat content of beef or
poultry items and to make informed dietary choices.
On August 5, 1994, FSIS published a notice of extension of the date
that it would enforce compliance with the nutrition labeling
requirements for ground beef and hamburger (59 FR 39941). The Agency
extended the compliance enforcement date for these products
indefinitely, pending publication of a final rule on percentage
labeling for lean and fat on ground beef and hamburger. The Agency has
not published a final rule concerning percentage labeling of ground
beef and hamburger. Therefore, producers and retailers continue to use
the term ``lean'' in percentage labeling on the packages of ground beef
and hamburger.
Other Nutrition Activities
In addition to developing this proposed nutrition labeling rule,
USDA conducts numerous other activities related to nutrition. This
proposed rule on nutrition labeling is an integral part of USDA's
efforts to educate consumers concerning nutrition and diets. Since 1980
USDA and the Department of Health and Human Services (HHS) have jointly
published the Dietary Guidelines for Americans every five years. The
Dietary Guidelines provide advice concerning food choices that promote
health and prevent disease. USDA and HHS released the Dietary
Guidelines for Americans, 2000, at the National Nutrition Summit on May
30, 2000, which was jointly sponsored by USDA and HHS. The Dietary
Guidelines for Americans, 2000, advises consumers to aim for a total
fat intake of no more than 30 percent of calories (page 30). In
addition, the Dietary Guidelines for Americans, 2000, includes a chart
showing the recommended upper limits for grams of saturated fat and
total fat per day for a range of total calories per day (page 30). The
nutrition information that FSIS is proposing to require on labels of
ground or chopped products and on either labels or point-of-purchase
materials for the major cuts of single-ingredient, raw products would
include the number of calories and the grams of total fat and saturated
fat the product contains. The information FSIS is proposing to require
would, therefore, assist consumers in following the advice in the
Dietary Guidelines for Americans, 2000.
Proposed Changes
Nutrition labeling of the major cuts of single-ingredient, raw
products. The Agency is proposing to require nutrition labeling of the
major cuts of single-ingredient, raw meat and poultry products, except
for certain exemptions. For these products, FSIS is proposing to make
the guidelines currently in place for the voluntary nutrition labeling
program mandatory. Thus, for all of these products, other than raw
ground beef and ground pork which are currently classified as major
cuts, FSIS is proposing that nutrition information be provided on the
label of these products or at their point-of-purchase. As discussed
below, at this time, FSIS is not proposing to require nutrition
information for single-ingredient, raw meat and poultry products that
are not major cuts and that are not ground or chopped products.
In the preamble to the final rule on nutrition labeling of meat and
poultry products, under the discussion of its voluntary nutrition
labeling program which covered all single-ingredient, raw meat and
poultry products, FSIS stated that it believed that it was important to
provide nutrition information to consumers (58 FR 640). FSIS also
stated that it believed that by allowing for the use of point-of-
purchase materials for single-ingredient, raw meat and poultry
products, retailers would be able to provide consumers with the
necessary nutrition information (58 FR 640). FSIS continues to believe
that nutrition information for these products is important and
necessary.
In the two most recent surveys, FSIS found that significant
participation in the voluntary nutrition labeling program does not
exist. FSIS found that less than 60 percent of the stores surveyed
provided nutrition information for 90 percent of the major cuts of
single-ingredient, raw meat and poultry products. In its proposed and
final rules on nutrition labeling of meat and poultry products, FSIS
stated that if it determined, during any evaluation of its voluntary
guidelines, that significant participation did not exist, it would
initiate proposed rulemaking to determine whether it would be
beneficial to require nutrition labeling on single-ingredient, raw meat
and poultry products (56 FR 60306, 58 FR 640).
Because the most recent surveys showed that significant
participation in the voluntary nutrition labeling program does not
exist, FSIS now believes that this proposed rule is necessary and that
it would be beneficial to require the labeling of the major cuts of
single-ingredient, raw meat and poultry products to bear nutrition
information. FSIS believes that without nutrition information,
consumers are not able to assess the nutrient content of the major cuts
and thus cannot make educated
[[Page 4974]]
choices about these products based on nutrition information. FSIS
believes that the lack of this information on the labeling of the major
cuts causes the labeling to be misleading. The FMIA and PPIA provide
that product is misbranded if its labeling is false or misleading in
any particular (21 U.S.C. 601(n)(1) and 453(h)(1)). Therefore, without
the nutrition information for the major cuts of single-ingredient, raw
products that would be provided if significant participation in the
voluntary program existed, the Agency has tentatively concluded that
these products would be misbranded under section 1(n) of the FMIA or
section 4(h) of the PPIA. FSIS requests comments on whether consumers
are currently able to assess the nutrient content of the major cuts and
whether consumers are currently able to make educated choices about
these products based on nutrition information.
If the guidelines currently in place for the voluntary nutrition
labeling program are made mandatory, it would ensure that consumers are
provided with necessary nutrition information concerning the major
cuts. Therefore, the Agency is proposing to make mandatory for the
major cuts of single-ingredient, raw meat and poultry products the
current provisions for the voluntary nutrition labeling program for
presentation of nutrition information on point-of-purchase materials.
FSIS intends to make point-of-purchase materials available over the
Internet free of charge. The point-of-purchase materials reflecting the
final nutrition labeling regulations that FMI developed show nutrition
information in charts with columns covering multiple products. FSIS
requests comments on whether the Agency should develop point-of-
purchase materials that present nutrition information as a compilation
of individual nutrition facts panels for each product or whether the
nutrition information on the materials should be presented in charts
with horizontal or vertical columns to cover multiple products.
Also, consistent with the existing provisions in the voluntary
nutrition labeling program, the Agency is proposing to require that if
nutrition information is provided on the label of individual packages
of major cuts of single-ingredient, raw products, the current
requirements of the mandatory nutrition labeling program will apply,
but the nutrition information on the label may be declared either on
the basis of ``as consumed'' or ``as packaged.''
FSIS is proposing to allow nutrition information on the label to be
declared on the basis of ``as consumed'' without also requiring that
the information on the label be declared on the basis of ``as
packaged'' for the major cuts of single-ingredient, raw products
because, as discussed below, most of these products will not need FSIS
compliance scrutiny. Also as noted below, nutrition information for
products under the existing mandatory nutrition labeling program must
be provided on an ``as packaged'' basis for compliance purposes.
Consistent with the existing voluntary nutrition labeling program, FSIS
is proposing that the declaration of the number of servings per
container need not be included on the nutrition label for the major
cuts of single-ingredient, raw products. FSIS is not proposing to
require that the number of servings per container be declared for the
major cuts of single-ingredient, raw products because all of these
products are random weight products, and the number of servings is not
currently required on random weight products (see
Secs. 317.309(b)(10)(iii) and 381.409(b)(10)(iii)).
Although FSIS believes that nutrition information on labels of
individual packages of single-ingredient, raw products is useful, FSIS
is proposing that the nutrition information for the major cuts of
single-ingredient, raw products may also be provided on point-of-
purchase materials because, as stated in the 1993 rule, consumers have
reasonable expectations as to the nutrient content of these products.
Also, the nutrient content of a given major cut is relatively uniform
across the market, and these products are not formulated in the manner
of ground or chopped products. Therefore, FSIS believes it would be
relatively easy to prepare point-of-purchase materials for the major
cuts and relatively easy for consumers to find the nutrition
information for a particular major cut on point-of-purchase materials.
Although FSIS continues to believe that consumers have reasonable
expectations as to the nutrient content of these products, FSIS also
continues to believe that it is important to provide nutrition
information to consumers, either through labels on packages or point-
of-purchase materials. FSIS requests comment on whether consumers have
reasonable expectations concerning the nutrient content of the major
cuts of single-ingredient, raw products and on whether point-of-
purchase materials are appropriate vehicles for conveying nutrition
information for these products. FSIS specifically requests comment on
whether it should require that nutrition labeling should be provided
for these products on their label and, if so, on what basis it would
require such labeling.
FSIS regulations provide that in evaluating whether there is
significant participation in the voluntary nutrition labeling program,
FSIS will consider only the major cuts of single-ingredient, raw meat
and poultry products (Secs. 317.343(a) and 381.443(a)). Consistent with
the regulations, FSIS' voluntary nutrition labeling surveys only
assessed whether nutrition labeling was provided for the major cuts of
single-ingredient, raw meat and poultry products.
Examples of single-ingredient, raw products that are not major cuts
(and that are not ground or chopped) include pork jowls, pigs feet,
pork leg, pork shoulder picnic, and beef round rump. For single-
ingredient, raw products that are not ground or chopped and are not
major cuts, FSIS is not proposing that nutrition information must be
provided. However, FSIS is proposing that if nutrition information is
provided, it must be provided according to the existing guidelines for
the current voluntary nutrition labeling program. Therefore, if
nutrition information is provided for these products, it would be
consistent with nutrition information for the major cuts of single-
ingredient, raw products.
As the next step in the process of evaluating the need for
nutrition labeling of meat and poultry products, FSIS will examine the
current state of nutrition labeling for single-ingredient, raw products
that are not ground or chopped and that are not major cuts. FSIS will
assess whether adequate nutrition information is being provided for
these products. Until this assessment is made, FSIS cannot determine
whether it would be beneficial to require nutrition labeling for
single-ingredient, raw products that are not ground or chopped and are
not major cuts. Whether the labeling of these products should be
required to bear nutrition information would depend on whether adequate
nutrition information is being provided for them and, if it is not
being provided, what the effect is of its not being available. If FSIS
determines that adequate nutrition information is not being provided
for these products, FSIS will consider whether to propose to require
nutrition labeling for these products.
FSIS is proposing to revise the nutrition labeling regulations to
clarify which provisions apply to nutrition labels on single-
ingredient, raw products that are not ground or chopped, including the
major cuts, and which provisions apply to point-of-
[[Page 4975]]
purchase materials for these products. FSIS is proposing to revise the
regulations so that the provisions for nutrition labels for these
products are in Secs. 317.309 and 381.409, and the provisions for
point-of-purchase materials for these products are in Secs. 317.345 and
381.445.
Nutrition labeling of ground or chopped products. The Agency is
proposing to add new provisions at Secs. 317.301 and 381.401, in the
Federal meat and poultry product inspection regulations. In proposed
Sec. 317.301, FSIS is proposing to require that nutrition labels be
provided for all ground or chopped (livestock species) and hamburger,
with or without added seasonings, unless an exemption applies. In
proposed Sec. 381.401, FSIS is proposing to require that nutrition
labels be provided for all ground or chopped (kind), with or without
added seasonings, unless an exemption applies. Products that will have
to bear nutrition labeling if this proposal is finalized include
single-ingredient, raw hamburger, ground beef, ground beef patties,
ground chicken, ground turkey, ground chicken patties, ground pork, and
ground lamb. In this discussion, these products will be referred to as
ground or chopped products. Ground or chopped products that are multi-
ingredient products or heat processed products are already required to
bear nutrition labeling, unless they qualify for an exemption. This
proposed provision would extend the current mandatory nutrition
labeling requirements to single-ingredient, raw ground or chopped
products. The proposed provisions do not address sausages or other
comminuted products. These products are typically multi-ingredient or
heat processed products that are already required to bear nutrition
information.
As discussed under the ``Background'' heading above, the existing
regulations include exemptions from nutrition labeling requirements,
such as an exemption for products produced by small businesses, custom
slaughtered or prepared products, and certain products that are
packaged, portioned or processed at retail. As discussed below under
the ``Exemptions'' heading, most of these exemptions would apply to
ground or chopped products that qualify for the exemptions. However,
FSIS is proposing that the current exemptions from nutrition labeling
for ready-to-eat products packaged or portioned at retail stores and
similar retail-type establishments and for multi-ingredient products
processed at retail stores and similar retail-type establishments not
apply to ground or chopped meat and ground or chopped poultry products,
unless the retail store or similar retail-type establishment meets the
requirements of the small business exemption. This issue is discussed
further under the ``Exemptions'' heading below.
The terms ``ground'' and ``chopped'' are synonymous (see
Sec. 319.15). FSIS is proposing to use both terms because both are used
in FSIS regulations and by industry. In the discussion below, any
statements made regarding the nutrient values or the production of
``ground'' products would also apply to ``chopped'' products.
On June 3, 1997, the Center for Science in the Public Interest
(CSPI) submitted a petition to FSIS stating that FSIS should require
complete ``Nutrition Facts'' on ground beef labels that make nutrient
content claims; should prohibit ``% lean'' claims on ground beef;
should require ground beef to meet the same definitions of ``lean'' and
``extra lean'' that apply to other foods; and should require ground
beef labels to replace ``% lean'' and ``% fat'' claims with the same
``% less fat'' claims used by other foods. CSPI also submitted
information illustrating the variations in ground beef labels that
include information on the lean or fat percentages of the product.
Consistent with CSPI's petition, the Agency has tentatively
determined that nutrition information should be required on packages of
all ground or chopped meat and poultry products, unless an exemption
applies. FSIS is proposing to require this information even if there
are no nutrient content claims on the label.
With regard to the statements in CSPI's petition concerning the use
of ``% lean,'' ``lean,'' ``extra lean,'' and ``% less fat'' claims on
ground beef labeling, FSIS is not revising the regulations as the
petitioner requested. As discussed below, FSIS is proposing to permit a
statement of lean percentage on the label or in labeling of all ground
or chopped meat and ground or chopped poultry products that do not meet
the regulatory definition for ``low fat'' as long as a statement of the
fat percentage is also provided, because consumers have become
accustomed to this information, and because FSIS believes that this
information provides a quick, simple, accurate means of comparing these
products.
Unlike other single-ingredient, raw products, producers are able to
formulate precisely the fat content of ground or chopped products.
Therefore, in this respect, these products are similar to products in
the existing mandatory program. The fat content of ground beef products
can be formulated to range from under 6 percent to 30 percent. Below is
a table that compares the nutrient values of three ground beef products
that contain different levels of fat. All values are based on raw
product.
----------------------------------------------------------------------------------------------------------------
Nutrient values per 100 g Ground beef 17% fat Ground beef 21% fat Ground beef 27% fat
----------------------------------------------------------------------------------------------------------------
Calories............................. 234.................... 264.................... 310.
Cholesterol.......................... 69 mg.................. 75 mg.................. 85 mg.
Fatty acids, saturated............... 6.8 g.................. 8.3 g.................. 10.8 g.
----------------------------------------------------------------------------------------------------------------
Source: USDA Nutrient Database for Standard Reference (1985
data)
FSIS believes that consumers cannot easily see the fat in ground or
chopped beef. In ground or chopped beef products, the fat is uniformly
distributed throughout the product and is not clearly distinguishable
on the surface of the product. Therefore, consumers cannot estimate the
level of fat in these products and cannot compare the levels of fat in
these products to those in other products.
Fat is not the only factor that contributes to the nutrient
variability of ground beef products. Producers sometimes use beef from
advanced meat recovery (AMR) systems and low temperature rendering in
ground or chopped beef products, which affect the nutrient variability
of ground beef products. Product derived from low temperature rendering
of beef tissue that is not fatty tissue, such as fat reduced beef or
finely textured beef, is considered beef and can be used in ground or
chopped beef or hamburger and other ground or chopped meat products.
The regulations currently do not address the use of fat reduced beef or
finely textured beef. FSIS may address the use of such products derived
from low temperature rendering in a future rulemaking.
[[Page 4976]]
An American Meat Institute (AMI) survey found that the use of
product derived from AMR systems in ground beef was becoming more
prevalent, although AMI did not obtain specific information concerning
the volume of product from AMR systems (The American Meat Institute
Foundation, Relative Ground Beef Contribution to the United States Beef
Supply (May 1996): 10). This survey also found that producers use
product such as finely textured beef recovered via technology (a
product derived from low temperature rendering) in ground beef products
to achieve specific lean contents (The American Meat Institute
Foundation, Relative Ground Beef Contribution to the United States Beef
Supply (May 1996): 11). It should be noted that beef from AMR systems
is not used at retail, unless the retail establishment is grinding beef
product produced at a Federal establishment. Ground beef produced at
retail from a single cut of meat, such as ground chuck or ground round,
would not typically include beef from AMR systems. However, ground beef
produced at retail from trimmings produced at a Federal establishment
could include beef from AMR systems.
Typically, meat from AMR systems does not comprise more than 10
percent of ground meat products, including ground beef (R.A. Field,
``Bone Marrow Measurements for Mechanically Recovered Products from
Machines that Press Bones,'' Meat Science 51 (1999): 206). Similarly,
meat from low temperature rendering usually does not comprise more than
10 percent of ground products, including ground beef. However, because
beef from AMR systems or low temperature rendering generally has higher
levels of cholesterol, iron, and calcium than other beef, the use of
these types of beef in ground beef products can affect the nutrient
content of these products. The table below shows the percentage fat and
the levels of iron and calcium per 100 grams of product for regular
ground beef, for beef from AMR systems, and for product made from 90
percent regular ground beef and 10 percent beef from AMR systems. For
regular ground beef and for beef from AMR systems, the table shows
values from different studies (R.A. Field, ``Bone Marrow Measurements
for Mechanically Recovered Products from Machines that Press Bones,''
Meat Science 51 (1999): 206, 209). FSIS calculated the nutrient values
for product comprised of 90 percent ground beef and 10 percent AMR
product based on the values from the studies. FSIS calculated values
for product made from 90 percent ground beef and 10 percent AMR product
because, as stated above, typically meat from AMR systems does not
comprise more than 10 percent of ground meat products. All values shown
below are based on raw product.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Regular ground beef Ground beef, 10% AMR
Nutrient values per 100 grams (Anderson et al., Beef from AMR (Hasiak Beef from AMR product product (Hasiak and Ground beef, 10% AMR
1986) and Marks, 1997) (Leising, 1997) Marks) product (Leising)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Cholesterol........................ 85 mg................. 115 mg................ 102 mg............... 88 mg................ 86.7 mg
Iron............................... 1.7 mg................ 2.8 mg................ 5.6 mg............... 1.81 mg.............. 2.09 mg
Calcium............................ 8 mg.................. 108 mg................ 115 mg............... 18.0 mg.............. 18.7 mg
--------------------------------------------------------------------------------------------------------------------------------------------------------
Even if producers do not use beef from AMR systems or beef derived
from low temperature rendering, they are able to precisely control the
amount of fat in the beef that is ground or chopped to create packages
of ground or chopped beef. A study concerning testing for the fat
content of ground beef found that, using two testing methods, ground
beef formulated for a certain fat percentage varied by only 2
percentage points around the average fat percentage. Although this
study found some problems concerning blending of ground beef and
testing for the fat content in ground beef, its results show that the
product can be and is precisely formulated and within the control of
the producer (Robert Campbell, ``Ground Beef Testing: Determining Fat
Content and Distribution,'' Meat and Poultry (October, 1997): 67-69).
Many ground beef producers have quality control programs to control the
fat content of their product. These producers conduct regular sampling
and testing for fat in ground beef products. Thus, producers are able
to formulate these products to control the amount of fat in them more
precisely than the fat can be controlled in other cuts. Other single-
ingredient, raw products cannot be formulated in this manner or to this
degree.
Although ground beef comprises the majority of ground meat products
sold at retail, products such as ground lamb and ground pork are also
available. Similar to ground beef products, these products may contain
varying amounts of fat and varying nutrient content, which consumers
cannot visually detect. In addition, ground pork may include product
from AMR systems or from low temperature rendering, which may affect
the nutrient content of these products. Therefore, FSIS is proposing to
require nutrition labeling on these products and other ground or
chopped meat products. As noted above, meat from AMR systems or low
temperature rendering typically does not comprise more than 10 percent
of ground meat products, including ground pork. Product from AMR
systems or low temperature rendering is generally not used in ground or
chopped lamb. Because products such as ground pork and ground lamb may
contain varying amounts of fat and nutrient content, which consumers
cannot visually detect, and because ground pork may include product
from AMR systems or low temperature rendering, FSIS is proposing to
require nutrition labeling on all ground or chopped meat products.
The fat-to-lean content of ground poultry products does not vary as
greatly as that of ground beef products; however, the fat content of
ground poultry can vary depending upon whether the product is ground
light or dark meat, and whether the product includes poultry skin. As
with the fat on ground meat products, consumers cannot readily detect
the fat content of ground poultry products. The table below shows
values for light and dark turkey meat, with skin and without skin. All
values are based on raw product. The nutrient content of ground turkey
would vary depending on which types of meat were used to produce the
product.
----------------------------------------------------------------------------------------------------------------
Turkey, dark meat Turkey, dark meat Turkey, light meat Turkey, light Meat
Nutrient values per 100 grams and skin only and skin only
----------------------------------------------------------------------------------------------------------------
Calories........................ 172............... 130............... 165............... 116
[[Page 4977]]
Cholesterol..................... 65 mg............. 62 mg............. 62 mg............. 58 mg
Fatty acids, saturated.......... 2.99 g............ 1.64 g............ 2.19 g............ .53 g
----------------------------------------------------------------------------------------------------------------
Source: USDA Nutrient Database for Standard Reference (1985
data)
Because the characteristics of ground or chopped poultry are
similar to those of ground or chopped meat, FSIS is also proposing to
require nutrition labeling on ground or chopped poultry products. The
Agency is also proposing comparable requirements for ground or chopped
meat and poultry products because it is committed to equitable
treatment of meat and poultry products. FSIS has consistently taken the
position that similar products should be regulated in a similar manner
to facilitate consumers' ability to make comparisons among these
products.
For the reasons discussed above, the Agency has tentatively
concluded that ground or chopped meat and poultry products that do not
bear nutrition information would be misbranded under section 1(n)(1) of
the FMIA and section 4(h)(1) of the PPIA. As noted above, in the
January 6, 1993 final rule, the Agency did not require nutrition
labeling on packages of single-ingredient, raw meat and poultry
products because FSIS believed that consumers had reasonable
expectations as to the nutritional qualities of such products since
they are not modified through various stages of preparation, such as
cooking and heat processing (58 FR 637). FSIS now believes that the
variation in the fat and nutrient content of different ground or
chopped products, the formulated nature of these products, and the fact
that the fat content of these products cannot be readily visually
assessed makes it difficult for consumers to have a reasonable
expectation as to the nutritional quality of these products. Further
consideration of the issues raised in the petition from CSPI brought
many of these issues to FSIS' attention. If this proposal is adopted,
the existing mandatory nutrition labeling provisions in Secs. 317.309
and 381.409 would apply to these products, unless they are subject to
an exemption.
Although current labeling on ground beef products often includes
information concerning the percentage of fat in the product, as noted
in the CSPI petition, without complete nutrition labeling, consumers
cannot easily determine the amount of fat per serving of ground beef.
Also, without complete nutrition labeling, consumers cannot assess how
much saturated fat, cholesterol, protein, or calories the product
contains. Furthermore, consumers cannot easily compare fat percentages
on the labeling of ground beef products with the information concerning
grams of fat per serving or with the information concerning the percent
daily values that is found on the labeling of products that are
currently covered by the mandatory nutrition labeling program.
The Agency tentatively concludes that information concerning the
nutritional qualities of ground or chopped meat and poultry products is
particularly important because these products, especially ground beef,
are widely consumed. Pertinent nutrition information is integral to
consumer purchase decisions because use of this information may result
in prevention of health problems and reduction of health risks for some
consumers. Additional information about the nutrient values of ground
or chopped meat and poultry products would enable consumers to make
informed decisions about including these products in their diets and,
therefore, will help consumers to construct healthy diets.
FSIS is proposing to require that nutrition information for ground
or chopped meat and poultry products appear on the label of these
products (unless an exemption applies), as is required for other
products in the current mandatory nutrition labeling program, rather
than on point-of-purchase materials. Ground or chopped products are
similar to products in the mandatory nutrition labeling program, which
requires nutrition information to be on the label of products, in that
certain parameters, such as their fat content, can be controlled
precisely to obtain the desired product. In addition, because there are
numerous formulations of ground or chopped products, it would be
difficult for producers or retailers to develop point-of-purchase
materials that would address all the different formulations that exist
for these products. Furthermore, it would be difficult for consumers to
find the correct information for a specific ground or chopped product
on point-of-purchase materials that include information concerning
numerous formulations of these products. For these reasons, FSIS
tentatively concludes that nutrition information should be required on
the label of these products, consistent with the requirements in the
existing mandatory nutrition labeling program. FSIS requests comments
concerning whether nutrition information should be required on
individual packages of ground or chopped product or whether the
information should be allowed at their point-of-purchase.
In addition, consistent with requirements for products that fall
under the existing mandatory nutrition labeling program, FSIS is
proposing that the declaration of nutrient and food component content
for ground or chopped products be required on an ``as packaged'' basis.
The preamble to the final rule explained why products in the mandatory
nutrition labeling program would be required to be labeled on an ``as
packaged'' basis: ``There are varieties of cooking methods that affect
the nutrient values of food products differently. Therefore, there is
no method to assure the accuracy or measure compliance of the nutrient
values of food labeled on an `as consumed' basis.'' (58 FR 648). These
reasons for requiring nutrition information on an ``as packaged'' basis
for products in the current mandatory nutrition labeling program also
are the basis for requiring that ground or chopped products be required
to be labeled on an ``as packaged'' basis. Whether or not the fat is
drained off during the cooking of ground or chopped products would
affect the nutrient values of ground or chopped products. As discussed
below, ground or chopped products will be subject to FSIS compliance.
Therefore, FSIS tentatively concludes that it is necessary to require
that nutrition information be presented on an ``as packaged'' basis for
ground or chopped products in order to assure the accuracy of nutrient
values and to measure compliance of the nutrient values of these
products. FSIS requests comment on whether it would be difficult for
producers to comply with this requirement.
However, consistent with the provisions of the existing mandatory
program, FSIS is proposing that nutrition information for ground or
chopped products may be presented on an ``as consumed'' basis, in
addition to the required ``as packaged'' basis, provided that
preparation and cooking instructions are clearly stated. FSIS is
proposing to allow nutrition
[[Page 4978]]
information on as ``as consumed'' basis, in addition to the required
``as packaged basis,'' because FSIS believes this is useful information
for consumers.
FSIS requests comments on whether all Federal establishments and
retail stores are able to control the fat and nutrient content of
ground or chopped meat and poultry products. FSIS also requests comment
on the practices of retail stores that grind or chop meat and poultry.
FSIS is interested in whether retail stores that grind or chop product
mix trimmings from one Federal establishment with trimmings from other
Federal establishments. In addition, FSIS is interested in data on the
extent to which product from AMR systems or product from low
temperature rendering is used in ground or chopped products.
FSIS requests comments concerning whether consumers have reasonable
expectations as to the nutritional quality of ground or chopped
product, whether consumers know which ground or chopped products are
lowest in fat, whether consumers understand that the fat content of
ground or chopped product can affect other nutrients, whether consumers
can see the fat in ground or chopped meat and poultry products, and
whether consumers can make comparisons among ground or chopped products
and other products.
Exemptions
Under Secs. 317.400(a)(1) and 381.500(a)(1), food products produced
by small businesses are exempted from mandatory nutrition labeling if
the product labels bear no nutrition claims or nutrition information.
The regulations provide that a small business is any single-plant
facility or multi-plant company or firm that employs fewer than 500
people and, as of July 1996, that produces 100,000 pounds or less
annually of the product that qualifies the establishment for the
exemption from mandatory nutrition labeling. The Agency stated in the
preamble to the January 6, 1993, final rule, that it would exempt small
businesses from mandatory nutrition labeling requirements because these
requirements would create undue economic hardship for small businesses
and would create disincentives for these small businesses to develop
more nutritious food products (58 FR 638).
For the reasons stated in the January 6, 1993 final rule, FSIS
continues to believe that small businesses should be exempt from the
mandatory nutrition labeling requirements proposed for ground or
chopped meat and ground or chopped poultry products. Therefore, under
this proposal, ground or chopped products produced by establishments
that qualify for the small business exemption would be exempt from the
proposed nutrition labeling requirements.
As discussed below, a significant amount of ground beef is
processed at retail. Therefore, FSIS is proposing to revise the
regulations to make clear that a single retail store or multi-retail
store operation could qualify for the small business exemption. To
qualify for this exemption, the retail facility must either be a single
retail store that employs 500 or fewer people or a multi-retail store
operation that employs 500 or fewer people. In addition, to qualify for
the exemption, the retail establishment could produce no more than
100,000 pounds per year of the product that qualifies the establishment
for an exemption. Consistent with existing regulations, the
qualification of a multi-retail store operation for an exemption from
nutrition labeling would be based upon its total annual production of
the product for all of its stores that qualifies the operation for the
exemption and the total number of employees for all of its stores (see
58 FR 638 for guidance on existing regulations).
As under current regulations, for the purposes of the small
business exemption, a food product is a formulation, not including
distinct flavors which do not significantly alter the nutritional
profile of the product, sold in any size package in commerce.
Therefore, ground or chopped products formulated to have different
levels of fat would be considered different food products for purposes
of the small business exemption. For example, if a multi-retail store
operation employed 500 or fewer people in total and produced, in total
among all of its stores, 70,000 pounds of ground beef that is 10
percent fat and 60,000 pounds of ground beef that is 20 percent fat
annually, the multi-retail store operation would not be required to
include nutrition information on the label of these specific products
if the labels for these products bore no nutrition claims or nutrition
information. However, for example, if a multi-retail store operation
employed in total 500 or fewer employees and produced 130,000 pounds of
10 percent fat ground beef annually in total among all of its stores,
it would not be exempt from nutrition labeling requirements on the
basis of the ``small business exemption.'' FSIS is interested in
comments on whether the exemption proposed is appropriate for purposes
of ground or chopped products produced at retail establishments.
FSIS does not believe that the reasons that necessitated the
establishment of the small business exemption, as explained in the
January 6, 1993 final rule, are applicable to the major cuts of single-
ingredient, raw meat and poultry products produced by small businesses.
For these products, FSIS is proposing that nutrition information may be
provided on labels or alternatively at their point-of-purchase. FSIS
intends to make point-of-purchase materials available over the Internet
free of charge; therefore, the proposed nutrition labeling requirement
for major cuts of single-ingredient, raw products should not impose an
economic hardship for small businesses, including those that are retail
stores. FSIS is proposing to revise Secs. 317.400(a)(1) and
381.500(a)(1) to provide that the small business exemption would not
apply to the major cuts of single-ingredient, raw products.
Under existing Secs. 317.400(a)(7) and 381.500(a)(7), retail stores
and similar retail-type establishments are exempted from nutrition
labeling requirements for multi-ingredient products processed at retail
establishments and ready-to-eat products packaged or portioned at
retail establishments (which would include ready-to-eat and multi-
ingredient ground or chopped products) if the products bear no
nutrition claims or nutrition information. As stated in the preamble to
the January 6, 1993 final rule, FSIS exempted retail establishments
from mandatory nutrition labeling requirements for these products
because the Agency determined that it would be impractical to enforce
nutrition labeling requirements on these products prepared or served at
retail, and because the Agency concluded, based on a review of National
Food Consumption Survey (NFCS) data, that the average person's diet
consisted of an insignificant proportion of ready-to-eat retail
packaged products or retail processed products (58 FR 639).
Most ground poultry is processed and packaged outside retail
establishments. However, most ground beef is ground and packaged at
retail. An AMI report states that retail survey respondents reported
that an average 18.5 percent of their ground beef sales was from
product arriving in a finely ground state, ready to sell or ready for
repackaging at retail. Retail stores or distribution centers ground or
re-ground 81.3 percent of ground beef sold (The American Meat Institute
Foundation, Relative Ground Beef Contribution to the United States Beef
Supply (May 1996): 7).
As noted above, in the preamble to the January 6, 1993, final rule,
the
[[Page 4979]]
Agency concluded that the average person's diet consists of an
insignificant portion of ready-to-eat retail packaged products or
retail processed products. Consumers who purchase ground beef likely
consume a significant amount of ground beef processed at retail.
Therefore, there may be a significant amount of ground beef products
that are ready-to-eat retail packaged products or retail processed
products.
As noted above, in the January 6, 1993 final rule, FSIS also
exempted retail establishments from mandatory nutrition labeling partly
because the Agency determined that it would be impractical to enforce
nutrition labeling requirements on products prepared or served at
retail. The Agency no longer believes enforcement of nutrition labeling
requirements at retail stores to be impractical because FSIS is already
conducting testing for Escherichia coli O157:H7 at retail.
Because a significant amount of ground beef is processed at retail,
the Agency believes that there may be a significant amount of multi-
ingredient ground beef retail processed products or ready-to-eat retail
packaged products. FSIS also believes that enforcement of nutrition
labeling at retail would not be impractical. Further, FSIS has
tentatively concluded that ground or chopped products that do not
include nutrition information would be misbranded for the reasons
stated above. Therefore, the Agency is proposing that the current
exemptions from nutrition labeling for ready-to-eat products packaged
or portioned at retail stores and similar retail-type establishments
and multi-ingredient products processed at retail stores and similar
retail-type establishments not apply to ground or chopped meat and
ground or chopped poultry products, unless the retail store or similar
retail-type establishment meets the requirements of the small business
exemption. FSIS requests comments and data on the volume of ground or
chopped products that are multi-ingredient retail processed products or
ready-to-eat retail packaged products.
FSIS is also proposing to revise the current retail exemptions
discussed above to make clear that if a retail establishment qualifies
for the small business exemption discussed above, ground or chopped
ready-to-eat products packaged or portioned at retail and ground or
chopped multi-ingredient products processed at retail would be exempt
from nutrition labeling requirements. Although most ground poultry is
processed and packaged outside retail establishments, FSIS believes it
is important to propose consistent requirements for all ground or
chopped products. Therefore, for all ground or chopped products,
including ground poultry, these exemptions would not apply, unless the
retail store or similar retail-type establishment meets the
requirements of the small business exemption.
The exemptions for ready-to-eat products packaged and portioned at
retail stores and for multi-ingredient products processed at retail
stores would not apply to the major cuts of single-ingredient, raw
products because they are not ready-to-eat or multi-ingredient
products.
As discussed above, in addition to the small business and retail
exemptions, existing Secs. 317.400 and 381.500 provide other exemptions
from nutrition labeling requirements. These exemptions include products
intended for further processing, products not for sale to consumers,
products in small packages that are individually wrapped packages of
less than \1/2\ ounce net weight, custom slaughtered or prepared
products, and products intended for export. To qualify for the first
three exemptions, the product's label cannot bear nutrition information
or a nutrition claim. In the preamble to the January 6, 1993, final
rule, FSIS explained that it was providing an exemption for products
intended for further processing and products not for sale to consumers
because consumers do not see the nutrition information on products used
for further processing or products that are not for sale to consumers.
The Agency also explained that it would exempt individually wrapped
packages of less than \1/2\ ounce net weight, provided no nutrition
claim or nutrition information was made on the label, because these
products are an insignificant part of the diet. With regard to the
custom exemption, the Agency explained that an exemption should apply
because these custom services are performed solely for individuals.
Finally, the Agency explained that products intended for export should
be exempt because these products are labeled according to the
requirements of the country where the product is to be exported (58 FR
639). The Agency has tentatively determined that the bases for these
exemptions, as explained in the January 6, 1993 final rule, are valid
as applied to nutrition labeling for ground or chopped products and for
major cuts of single-ingredient, raw products. Therefore, under this
proposal, any ground or chopped product or major cut of single-
ingredient, raw product that qualifies for any of these exemptions will
continue to be exempt even if the proposed nutrition labeling
requirements are adopted.
Under current regulations, products in packages that have a total
surface area available to bear labeling of less than 12 square inches
are exempt from nutrition labeling, provided the product's labeling
includes no nutrition claims or nutrition information and provided that
an address or telephone number that a consumer can use to obtain the
required information is included on the label. FSIS allowed for
nutrition information to be provided by alternative means for products
of this size in order to incorporate sufficient flexibility in the
regulations (58 FR 47625). For ground or chopped products, FSIS
believes it is necessary to provide this flexibility for products in
packages that have a total surface area available to bear labeling of
less than 12 square inches, provided that the labels for these products
bear no nutrition claims or nutrition information. However, because
nutrition information for the major cuts of single-ingredient, raw meat
and poultry products may be provided on point-of-purchase materials,
FSIS is proposing that the provisions for providing nutrition labeling
by alternate means for products in packages that have a total surface
area available to bear labeling of less than 12 square inches would not
apply to the major cuts of single-ingredient, raw meat and poultry
products.
As stated in the existing regulations, restaurant menus generally
do not constitute labeling or fall within the scope of these
regulations. Likewise, restaurant menus that include ground or chopped
products generally do not constitute nutrition labeling or fall within
the scope of these regulations. Similarly, although a restaurant menu
would most likely not include a major cut of single-ingredient, raw
product, if it did, the menu would not fall within the scope of these
regulations.
Finally, the current regulations provide that foods represented or
purported to be specifically for infants and children less than 4 years
of age must not include certain nutrient content declarations, because
infants and children less than 4 years of age have different nutrition
needs than adults and children older than 4 years of age. Under this
proposal, any ground or chopped product or major cut of single-
ingredient raw product represented or purported to be specifically for
infants and children less than 4 years of age would be required to meet
these same requirements.
FSIS requests comments on whether its proposed revisions to the
nutrition labeling exemptions are appropriate and
[[Page 4980]]
necessary for ground or chopped products and for the major cuts of
single-ingredient, raw products.
Enforcement and Compliance
Ground or chopped products. FSIS conducts a continuous sampling
program of products that fall under the mandatory nutrition labeling
program. If the proposal to mandate nutrition labeling of ground or
chopped meat and ground or chopped poultry products is adopted, the
procedures set forth for product sampling and nutrient analysis in
Secs. 317.309(h)(1)-(8) and 381.409(h)(1)-(8) will be applicable to
ground or chopped meat and to ground or chopped poultry products,
respectively. Under this proposal, the Agency will sample and conduct
nutrient analysis of ground or chopped products to verify compliance
with nutrition labeling requirements, even if nutrition labeling on
these products is based on the most current representative data base
values contained in USDA's National Nutrient Data Bank or the USDA
Nutrient Database for Standard Reference and there are no claims on the
labeling. Therefore, if these proposed provisions for ground or chopped
meat and poultry products are adopted, the Agency will treat these
products as it treats all other products for which regulations already
require nutrition labels on their package.
FSIS is proposing that ground or chopped products be subject to
compliance even if nutrition labeling on these products is based on the
most current representative data base values contained in USDA's
National Nutrient Data Bank or the USDA Nutrient Database for Standard
Reference because the fat content of different ground or chopped
products can vary significantly, depending upon the level of fat in the
product being ground and depending on whether product from advanced
meat recovery systems is used. Additionally, at this time, there are a
limited number of ground or chopped products in the database (e.g.,
ground beef, 17% fat, 21% fat, and 27% fat).
Further, FSIS program employees cannot visually assess whether
nutrition information on the label of ground or chopped products
accurately reflects the labeled products' contents because, in most
cases, it is not possible to visually assess the level of fat in a
ground product. For example, FSIS program employees cannot visually
determine whether product that is labeled 17 percent fat ground beef is
actually 17 percent fat ground beef as opposed to 27 percent fat (or
another percentage of fat) ground beef. Therefore, even if the retailer
or other producer uses information from the USDA database to label
these products, FSIS will need to conduct compliance sampling and
nutrient analysis to ensure that the information on the label
accurately reflects the nutrient content of the labeled products.
The Agency is also proposing to revise Secs. 317.345(e) and
381.445(e) so that they refer to USDA's National Nutrient Data Bank and
its released form, the USDA Nutrient Database for Standard Reference,
and to remove current references to the Agriculture Handbook No. 8
series, because this handbook series is now out of print.
For the nutrition labeling of some ground or chopped meat or ground
or chopped poultry, nutrient data may be immediately available through
the USDA Nutrient Database for Standard Reference (e.g., ground beef
with 17 percent fat, ground beef with 21 percent fat, and ground beef
with 27 percent fat). Private databases may be available to assess the
nutrient content of other products. In addition, producers are able to
provide the nutrition information for many products produced to meet
purchase specifications. Because producers know the different cuts of
meat that go into ground or chopped product, they have the information
necessary to determine the nutrient content of the products. FSIS
believes that if they need to conduct nutrient analysis, the analysis
should not impose an excessive burden. FSIS will develop a list of
published sources of information concerning the nutrient content of
ground or chopped products, so that industry could obtain available
literature from local libraries. This information would facilitate the
development of nutrition labels for ground or chopped products. FSIS
requests comments and supporting data on the costs that Federal and
retail establishments would incur for conducting nutrient analysis of
ground or chopped products.
For ground or chopped products that are nutritionally labeled at
official establishments, FSIS program employees will collect samples
for nutrient analysis at official establishments, consistent with the
Agency's existing sampling program of products that fall under the
mandatory nutrition labeling program. For ground or chopped products
that are produced and nutritionally labeled at retail, it is likely
that FSIS program employees will collect samples for nutrient analysis
while they are conducting other program activities at retail stores.
When collecting samples for nutrient analysis, FSIS will not typically
collect samples of the same product from both Federal establishments
and retail establishments, unless circumstances warrant sampling the
same product at both locations. In general, if a product from a Federal
establishment is further processed at retail, FSIS would only collect
samples of that product at retail, where it would be packaged for sale
to consumers. FSIS can distinguish between product packaged at retail
versus product packaged at a Federal establishment.
Major cuts of single-ingredient, raw products. If nutrition
labeling of the major cuts of single-ingredient, raw products (other
than ground beef or ground pork) is based on USDA's National Nutrient
Data Bank or the USDA Nutrient Database for Standard Reference, and
there are no nutrition claims on the labeling, FSIS will not sample and
conduct a nutrient analysis of these products. The Agency's sampling
and testing policy for these products will be consistent with its
policy under the current voluntary nutrition labeling program for these
products.
For the major cuts of single-ingredient, raw products, FSIS
personnel can visually identify the particular cut. If the nutrition
information for these products is based on USDA's National Nutrient
Data Bank or the USDA Nutrient Database for Standard Reference, and
there are no nutrition claims on the labeling, it is not necessary for
FSIS to verify the accuracy of this data because it is USDA data. If
the nutrition information is based on USDA data, and there are no
nutrition claims, FSIS program employees would only have to verify that
the data presented accurately pertains to a particular major cut of
single-ingredient, raw product. Therefore, FSIS does not need to
conduct nutrient analysis for these products.
If the nutrition information on the label or at the point-of-
purchase of major cuts of single-ingredient, raw products is based on
databases other than the above referenced USDA ones or other data, or
if there are nutrition claims on the labeling, these products would be
subject to FSIS compliance analysis. Most nutrition information for the
major cuts of single-ingredient, raw products is based on USDA data
and, typically, no nutrition claims are made on the labeling of these
products. Therefore, these products are and would generally continue to
be exempt from the FSIS nutrition labeling compliance verification
program.
It is likely that FSIS program employees will verify that nutrition
information is provided for the major
[[Page 4981]]
cuts of single-ingredient, raw products, either on their labels or at
their point-of-purchase, at retail stores while they are conducting
other program activities at retail. If nutrition information on the
point-of-purchase materials or labels for these products is not based
on USDA's National Nutrient Data Bank or the USDA Nutrient Database for
Standard Reference, or if there are nutrition claims on the labeling,
FSIS program employees may collect samples of the major cuts from
retail stores for nutrient analysis. Similarly, if major cuts are
nutritionally labeled at official establishments and the nutrition
information on the label is not based on USDA's National Nutrient Data
Bank or the USDA Nutrient Database for Standard Reference, or if there
are nutrition claims on the labeling, FSIS program employees may
collect samples of these products from the official establishment for
nutrient analysis.
Percentage Labeling
FSIS is withdrawing its proposed rule of May 24, 1994 (59 FR
26916), discussed above, which sought to amend the regulations by
permitting percentage labeling for lean and fat on ground beef and
hamburger, when the product did not meet the regulatory criteria
established for ``low fat,'' if the product had nutrition information
on its labeling or in point-of-purchase materials that were in close
proximity to the product. FSIS is withdrawing this proposal and
proposing revised percentage labeling requirements in this rule. In
this proposal, FSIS is expanding the categories of ground or chopped
products that can have lean percentage labeling.
FSIS is proposing to permit a statement of lean percentage on the
label or in labeling of ground or chopped meat and poultry products
that do not meet the regulatory criteria for ``low fat.'' The Agency is
proposing to do so because many consumers have become accustomed to
this labeling on ground beef products, and because FSIS believes this
labeling provides a quick, simple, accurate means of comparing all
ground or chopped meat and poultry products. The proposed regulatory
language requires that a statement of fat percentage be contiguous to,
in lettering of the same color, size and type as, and on the same color
background as, the statement of lean percentage. The Agency is
proposing these requirements concerning size, type, and color to ensure
that the statement of the fat percentage is as clear and readily
observable as the statement of the lean percentage.
FSIS requests comments on whether percent fat/percent lean
information provides a quick, simple, accurate means of comparing all
ground or chopped meat and poultry products. Also, FSIS is specifically
requesting comments concerning whether its proposed percent fat/percent
lean labeling provisions for ground or chopped meat and ground or
chopped poultry products that do not meet the regulatory criteria for
``low fat'' would be misleading in any way. FDA's regulations do not
provide for the nutrient content claim, ``X percent lean.'' Similarly,
FDA does not allow a statement of ``percent fat/percent lean'' on the
products it regulates. FSIS requests comment on whether these
discrepancies between FDA's and FSIS' regulations will cause confusion
among consumers. Finally, FSIS is not requiring the statement of fat
percentage to precede the statement of lean percentage but will allow
the statements to appear in either order. FSIS requests comment on
whether consumers are more likely to read and understand the statement
of fat percentage when it precedes the statement of lean percentage
than when it follows the statement of lean percentage.
Executive Order 12866--Preliminary Analysis
This action has been reviewed for compliance with Executive Order
12866. As this action is determined ``significant'' for purposes of
Executive Order 12866, the Office of Management and Budget (OMB) has
reviewed it.
Need for the Rule
During the 1996 nutrition labeling survey, RDI found 57.7 percent
of stores surveyed provided nutrition information for 90 percent of the
major cuts of single-ingredient, raw meat and poultry products, in
accordance with program guidelines. In the 1999 nutrition labeling
survey, RDI found that 54.8 percent of stores surveyed provided
nutrition information for 90 percent of the major cuts of single-
ingredient, raw meat and poultry products, in accordance with program
guidelines. Therefore, the most recent surveys did not show significant
participation in the voluntary nutrition labeling program as defined in
the regulations. Without significant participation, the Agency has
tentatively concluded that a lack of consistent and complete nutrition
information for the major cuts of single-ingredient, raw products
exists. FSIS has also tentatively concluded that producers' ability to
control the formulation of single-ingredient, raw ground or chopped
products results in variations across these products that may be
difficult for consumers to detect. Without nutrition information, FSIS
believes that these products would be misbranded under section 1(n) of
the FMIA or section 4(h) of the PPIA and that further action is
necessary in order to provide consumers with adequate nutrition
information that is consistent with the provisions of the 1993 final
nutrition labeling rule.
Baseline
In the analysis below, FSIS assumes that the level of voluntary
labeling, absent any Federal action, would remain at the current level.
The 1999 RDI nutrition labeling survey found that 54.8 percent of the
stores surveyed provided nutrition information for 90 percent of the
major cuts of single-ingredient, raw meat and poultry products, in
accordance with program guidelines. As there has been little change in
the level of compliance over the last several years (see discussion of
previous surveys above), FSIS believes that it is appropriate to assume
that this level of participation in the voluntary nutrition labeling
program would not change unless the regulations are revised.
In the analysis below, FSIS also assumes that 80 percent of the
retail establishments and processors have made investments in the
equipment necessary to print, stamp, or affix nutrition labels on
products. This assumption is based on the results of the 1999 RDI safe
handling labeling compliance survey. This survey revealed that 96.7
percent of large chains, 90.5 percent of large independent retailers,
and 84.1 percent of medium/small independents had already complied with
the Mandatory Safe Handling Statements on Labeling of Raw Meat and
Poultry Products final rule. FSIS used the 80 percent assumption in
order to be conservative and not overestimate the percentage of
processors and retailers that have already invested in the necessary
equipment. Because the equipment needed to print, stamp, or affix
nutrition labels is similar to the equipment used to print, stamp, or
affix labels to meet the ``safe handling'' rule's requirements, FSIS
assumes that 80 percent of establishments would not have to install new
machines for stamping, printing, or affixing nutrition labels for
ground or chopped products. FSIS is assuming that the same percentage
of processors have invested in this equipment as retailers. Again, this
is a conservative assumption. FSIS requests comments concerning whether
the 80 percent
[[Page 4982]]
estimate is appropriate for both processors and retailers.
To determine how many entities would be affected by this
rulemaking, the Agency used a combination of FSIS developed databases
and industry sources. Table 1 indicates that in 1999, 63 establishments
produced ground poultry and 2,426 establishments produced ground meat.
FSIS developed this data on establishments from its Enhanced Facilities
Database (EFD). This source does not provide separate data for ground
pork, lamb and beef. The number of establishments producing ground pork
or lamb is, however, likely to be very small based on information from
the AMI survey discussed below in the preliminary cost analysis. One
plant that produced either meat or poultry and did not have employment
size specification is excluded from Table 1.
Table 1.--Size Distribution of Meat and Poultry HACCP Plants Producing
Ground Products
------------------------------------------------------------------------
Poultry Meat Total
------------------------------------------------------------------------
Very Small............................. 10 1,470 1,480
Small.................................. 23 843 866
Large.................................. 28 68 96
Missing Values......................... 2 45 47
--------------------------------
Total................................ 63 2,426 2,489
------------------------------------------------------------------------
Note: Very small=9 or less employees; small=10 to 499 employees;
large=500 or more employees.
FSIS believes that a significant amount of ground beef is processed
at retail. Table 2 shows the number of retail stores in 1999. Most of
these stores grind beef. However, FSIS does not have specific data
concerning the levels of ground beef ground at retail or on the size of
retail stores that process ground beef. FSIS researched Census data for
this information, but specific information related to retail
establishments processing ground or chopped product was unavailable.
Table 2 reports data from FMI. FSIS combined the first two categories
of supermarkets with sales in excess of $2 million per year to compare
their share with ``other stores'' with sales of less than $2 million
per year. In 1999, there were 127,000 retail grocery stores.
Table 2.--Number of Retail Grocery Stores, 1999
------------------------------------------------------------------------
1999 1999 % of
number total
------------------------------------------------------------------------
Total......................................... 127,000 100
Supermarket Chains & Independent.............. 31,500 25
Other Stores.................................. 37,200 29
Convenience Stores............................ 57,500 45
Wholesale Clubs............................... 800 0.6
------------------------------------------------------------------------
Note: ``Supermarkets'' are defined to have sales of $2 million or more
per year. ``Other Stores'' are defined to have sales of under $2
million.
Source: FMI Information Service, Progressive Grocer, 67th Annual
Report of the Grocery Industry. April 2000, p.20.
With respect to consumers, FSIS assumes that without further
action, they would have access to the current level of labeling
information and continue with their current dietary habits. The 1999
RDI survey estimated that nutrition labeling, in accordance with the
program guidelines, for the major cuts of single-ingredient, raw meat
and poultry products was available to 62.8 percent of shoppers. This
estimate was based on the sales volume of the stores surveyed.
Consistent with the Agency's assumption about compliance among retail
stores, FSIS assumes that this level of available nutrition
information, in accordance with program guidelines, would not change
without further regulatory action.
FSIS used data from USDA's Continuing Survey of Food Intake by
Individuals (CSFII), and the associated Diet and Health Knowledge
Survey (DHKS) to establish a baseline for fat, saturated fat, and
cholesterol intake. The CSFII collects data on food intakes by
individuals. Most recently, USDA conducted three separate one-year
surveys for 1994-96. These surveys recorded two nonconsecutive days of
food consumption, and collected information on what and how much
individuals ate, and where the food was obtained. This information was
used to develop estimates of nutrient intake for each individual
respondent. The DHKS gathered data on consumers' knowledge of issues
related to diet and heath, and contained several questions relating to
the use of nutrition information labels and nutrition information for
food products. Linking information from the two surveys allowed FSIS to
correlate use of nutrition information from the DHKS with nutrient
intake data from the CSFII. The Agency focused here on two key
questions pertaining to nutrition information use on all food products
and on meat and poultry in particular:
Q: When you buy foods, do you use the nutrition panel that tells
the amount of calories, protein, fat, and such [e.g., sodium, total
carbohydrate] in the serving of a food: Often (always), sometimes,
rarely, or never? (Question 16-c, DKHS)
Q: When you buy raw meat, poultry, or fish, do you look for
nutrition information: Often (always), sometimes, rarely, or never?
(Question 17-I, DHKS).
Using data from the CSFII and the DHKS, FSIS estimated rates of
nutrition information usage, based on these two questions. The results
are presented in Table 3. Note that rates of label usage are uniformly
higher for women than for men, and that rates of nutrition label usage
are higher for food products as a whole than for raw meat, poultry and
fish products.
Table 3.--Consumer Usage of Nutrition Information
--------------------------------------------------------------------------------------------------------------------------------------------------------
Often Sometimes Rarely/never Do not buy
---------------------------------------------------------------------------------------
Men Women Men Women Men Women Men Women
--------------------------------------------------------------------------------------------------------------------------------------------------------
Use Nutrition Facts Panel....................................... 26.7 41.7 25.6 32.6 47.7 25.6 n/a N/A
Look for Nutrition Information on Raw Meat, Poultry, or Fish.... 16.9 22.1 18.2 18.0 62.7 57.9 2.2 2.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: Percent of respondents, based on 3 year weighted averages, 1994-1996.
To establish a baseline of Intake of Fat, Saturated Fat, and
Cholesterol, FSIS used the same data sources to estimate dietary intake
of fat, saturated fat, and cholesterol, along with the percentage of
calories from fat and saturated fat. The CSFII contains information on
the intake of these food components, based on the food consumption
reported by survey respondents.
Tables 4 and 5 present the estimated intake of fat, saturated fat,
and
[[Page 4983]]
cholesterol from the CSFII, broken down by types of nutrition
information usage reported in the DHKS.
Table 4.--Dietary Intake of Fat, Saturated Fat, by Usage of Nutrition Facts Panel
----------------------------------------------------------------------------------------------------------------
Rarely/
Often Sometimes never Average
----------------------------------------------------------------------------------------------------------------
Men:
Total Fat............................................... 83.13 92.52 98.14 92.51
Saturated Fat........................................... 26.93 31.43 33.67 31.12
Cholesterol............................................. 293.39 327.77 353.97 339.07
Women:
Total Fat............................................... 55.95 62.78 63.98 60.16
Saturated Fat........................................... 18. 04 20.77 21.39 19.71
Cholesterol............................................. 196.60 216.84 230.03 210.53
----------------------------------------------------------------------------------------------------------------
Note: Fat intake in grams, cholesterol in milligrams.
Table 5.--Dietary Intake of Fat, Saturated Fat, by Usage of Nutrition Information on Raw Meat, Poultry, or Fish
----------------------------------------------------------------------------------------------------------------
Rarely/
Often Sometimes never Do not buy Average
----------------------------------------------------------------------------------------------------------------
Men:
Total Fat.................................. 81.64 92.49 96.09 74.48 92.51
Saturated Fat.............................. 27.20 31.09 32.44 24.02 31.12
Cholesterol................................ 311.81 321.49 355.14 236.83 339.07
Women:
Total Fat.................................. 53.90 61.70 62.18 57.23 60.16
Saturated Fat.............................. 17.39 20.60 20.41 17.27 19.71
Cholesterol................................ 194.32 219.27 216.55 135.89 210.53
----------------------------------------------------------------------------------------------------------------
Note: Fat intake in grams, cholesterol in milligrams.
The estimated intake of fat and saturated fat can also be expressed
as the percentage of calories from fat. This conversion is done with
the following formula:
Percentage Calories from Fat = 900*fat/energy,
Where energy is total caloric intake (kilocalories), as measured by the
CSFII. Tables 6 and 7 show the percentage of calories from fat (and
total cholesterol) broken down by label and nutrition information
usage:
Table 6.--Percentage of Calories From Fat and Total Cholesterol, by Usage of Nutrition Facts Panel
----------------------------------------------------------------------------------------------------------------
Rarely/
Often Sometimes never Average
----------------------------------------------------------------------------------------------------------------
Men:
Total Fat............................................... 31.54 33.63 35.27 33.44
Saturated Fat........................................... 10.19 11.38 12.00 11.19
Cholesterol............................................. 293.39 327.77 353.97 339.07
Women:
Total Fat............................................... 31.14 33.40 34.49 32.49
Saturated Fat........................................... 10.00 11.38 11.59 10.64
Cholesterol............................................. 196.60 216.84 230.03 210.53
----------------------------------------------------------------------------------------------------------------
Note: Fat and Saturated Fat values are percentage of calories from fat source; cholesterol in milligrams.
Table 7.--Percentage of Calories From Fat and Total Cholesterol, by Usage of Nutrition Information on Raw Meat,
Poultry, or Fish
----------------------------------------------------------------------------------------------------------------
Rarely/
Often Sometimes never Do not buy Average
----------------------------------------------------------------------------------------------------------------
Men:
Total Fat.................................. 31.67 34.03 33.88 29.69 33.44
Saturated Fat.............................. 10.53 11.36 11.37 9.52 11.19
Cholesterol................................ 311.81 321.49 355.14 236.83 339.07
Women:
Total Fat.................................. 31.62 32.94 32.87 26.79 32.49
Saturated Fat.............................. 10.15 10.82 10.82 9.19 10.64
Cholesterol................................ 194.32 219.27 216.55 135.89 210.53
----------------------------------------------------------------------------------------------------------------
Note: Fat and Saturated Fat values are percentage of calories from fat source; cholesterol in milligrams.
[[Page 4984]]
Regulatory Options
FSIS considered several regulatory options: (1) Continuing with the
existing voluntary program; (2) making the voluntary program mandatory;
(3) requiring nutrition information on labels of all ground or chopped
products and making the voluntary program mandatory for the major cuts
of single-ingredient, raw meat and poultry products; (4) requiring
nutrition information on labels of the major cuts of single-ingredient,
raw meat and poultry products and on all ground or chopped products;
and (5) requiring nutrition information on labels of all single-
ingredient, raw meat and poultry products and all ground or chopped
products.
Option 1: Continuing with the voluntary program. FSIS could
continue with the existing voluntary program and attempt to increase
participation by providing additional assistance to the
nonparticipants. The 1999 nutrition labeling survey found a significant
difference in participation rates according to outlet type. Chain
stores showed a 65.5 percent participation rate, large independents
showed a 46.5 percent participation rate, and medium and small
independents showed a participation rate of 26.3 percent. Thus, FSIS
could provide nutrition information or point-of-purchase materials to
independent retail stores to encourage their participation in the
voluntary nutrition labeling program.
Retail establishments would continue to provide, on a voluntary
basis, nutrition labeling for all single-ingredient, raw meat and
poultry products, including major cuts identified in Secs. 317.344 and
381.444 (including ground beef and ground pork) and cuts that are not
identified as major cuts (including ground or chopped products not
covered in Secs. 317.344 and 381.444). This information could be
provided at the point-of-purchase or on the label of the product.
Option 2: Make the voluntary program mandatory. FSIS could make the
voluntary program mandatory by requiring nutrition information, either
on labels or at the point-of-purchase, for all single-ingredient, raw
meat and poultry products, including the major cuts of single-
ingredient, raw products identified in Secs. 317.344 and 381.444
(including ground beef and ground pork) and the nonmajor cuts of
single-ingredient, raw meat and poultry products (including ground or
chopped products not covered in Secs. 317.344 and 381.444). Under this
option, FSIS would assume that most retailers would display point-of-
purchase information for these products rather than nutrition labels,
because this is an inexpensive means of providing nutrition information
for multiple products. This approach does not allow for any distinction
between ground or chopped meat and poultry products and other cuts of
meat. In addition, this approach does not distinguish between the major
and nonmajor cuts.
Option 3: Require nutrition information on labels of all ground or
chopped meat and poultry products and make the voluntary program
mandatory for the major cuts of single-ingredient, raw meat and poultry
products (other than ground beef and ground pork). FSIS could require
nutrition information on the labels of all ground or chopped products
and could require nutrition information, either on their labels or at
their point-of-purchase, for the major cuts of single-ingredient, raw
meat and poultry products identified in Secs. 317.344 and 381.444
(other than ground beef and ground pork). Retail establishments and
producers could continue to voluntarily provide nutrition information
for nonmajor cuts of single-ingredient, raw meat and poultry products
that are not ground or chopped. This approach allows for a distinction
between ground or chopped meat and poultry and other cuts of meat and
poultry. It also allows for a distinction between major and nonmajor
cuts. Consistent with the regulations, the voluntary nutrition labeling
surveys only assessed whether nutrition labeling was provided for the
major cuts of single-ingredient, raw meat and poultry products. Until
some assessment is made of whether adequate information is being
provided for the nonmajor cuts of single-ingredient, raw products that
are not ground or chopped, FSIS cannot determine whether it would be
beneficial to require nutrition information for these products.
In their June 3, 1997, petition discussed above, CSPI stated that
USDA should require complete ``Nutrition Facts'' on ground beef labels
that make nutrient content claims. This option would require complete
``Nutrition Facts'' on all ground beef labels. Thus, CSPI's petition
supports this aspect of this option. However, the CSPI petition also
stated that point-of-purchase information is generally a poor
substitute for labels and that the ``Nutri-Facts'' posters and
brochures used by many stores have severe flaws. Thus, the CSPI
petition does not support providing nutrition labeling at the point-of-
purchase.
Option 4: Require nutrition information on labels of the major cuts
of single-ingredient, raw meat and poultry products and on all ground
or chopped products. FSIS could require nutrition information only on
labels of the major cuts of single-ingredient, raw meat and poultry
products identified in Secs. 317.344 and 381.444 (including ground beef
and ground pork) and on all other ground or chopped products not
covered in Secs. 317.344 and 381.444. As in Option 3, establishments
could voluntarily provide nutrition information, either at the point-
of-purchase or on the label, for the nonmajor cuts of single-
ingredient, raw meat and poultry products that are not ground or
chopped. This approach allows for a distinction between major cuts and
nonmajor cuts that are not ground or chopped. Until some assessment is
made of whether adequate information is being provided for the nonmajor
cuts of single-ingredient, raw products that are not ground or chopped,
FSIS cannot determine whether it would be beneficial to require
nutrition information for these products.
Option 5: Require nutrition labels on all single-ingredient, raw
meat and poultry products and on all ground or chopped products. FSIS
could require nutrition information on labels of all single-ingredient,
raw meat and poultry products, including both the major cuts of single-
ingredient, raw products identified in Secs. 317.344 and 381.444
(including ground beef and ground pork) and nonmajor cuts of single-
ingredient, raw products, and on all ground or chopped products not
covered in Secs. 317.344 and 381.444. An April 4, 2000, press release
on CSPI's web page, quotes the organization's executive director as
stating, ``Frozen and processed meats already have nutrition labels.
That same information should be on fresh meat'' (http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.cspinet.org/new/nutr_labeling.html). Thus, CSPI supports this
option.
FSIS requests comments on whether any of the options not chosen
would be a viable alternative to the option chosen and on the possible
costs and benefits of the options presented.
Quantification of Costs and Net Benefits of Regulatory Options
FSIS' preliminary analysis does not allow for a comparison of net
benefits among the regulatory options. The Agency is unable, at this
time, to distinguish between the benefits that accrue from moving from
a voluntary program to a mandatory program and the benefits that would
accrue from requiring nutrition labels on products versus nutrition
information on point-
[[Page 4985]]
of-purchase materials. Furthermore, although a comparison of costs of
the regulatory options might be possible, FSIS has not quantified all
costs. As a result, FSIS believes that it would be inappropriate to
provide a comparison of net benefits of the regulatory options
considered at this time.
Below, FSIS provides a preliminary analysis of the costs and
benefits of the proposed rule. FSIS requests comments on this
preliminary analysis and any data that would be useful in estimating
the costs and benefits of the proposed rule.
The Proposed Rule
FSIS is proposing Option 3. FSIS is proposing to require nutrition
labels on all ground or chopped meat and poultry products, with or
without added seasonings, unless an exemption applies, and to make the
voluntary nutrition labeling program mandatory for major cuts of
single-ingredient, raw meat and poultry products identified in
Secs. 317.344 and 381.444, unless an exemption applies.
Without a mandatory labeling program for the major cuts of single-
ingredient, raw products (that are not ground or chopped), FSIS
believes that complete and consistent information on the nutritional
attributes of these products will not be provided to every consumer.
FSIS also believes that the producers' ability to control the fat and
nutrient content of ground or chopped product and the consumers'
inability to detect the nutritional variations in these products
through observation makes it necessary to further require that labeling
requirements for all ground or chopped meat and poultry products be
consistent with those currently required for multi-ingredient and heat
processed products. The Agency has tentatively concluded that ground or
chopped products and the major cuts of single-ingredient, raw products
would be misbranded without nutrition information under the FMIA and
the PPIA (21 U.S.C. 601(n)(1) and 21 U.S.C. 453(h)(1)).
Many exemptions from the proposed nutrition labeling requirements
would apply to ground or chopped products and to the major cuts of
single-ingredient, raw products. The existing regulations provide that
food products produced by small businesses are exempted from mandatory
nutrition labeling if the product labels bear no nutrition claims or
nutrition information. Under this rule, small businesses that qualify
for the exemption would be exempt from the mandatory nutrition labeling
requirements proposed for ground or chopped products. However, the
small business exemption would not apply to the major cuts of single-
ingredient, raw meat and poultry products. Also, the existing
regulations provide that retail stores and similar retail-type
establishments are exempted from nutrition labeling requirements for
multi-ingredient products processed at retail and ready-to-eat products
packaged or portioned at retail if the products bear no nutrition
claims or nutrition information. In this rule, FSIS is proposing that
these exemptions not apply to ground meat and poultry products, unless
the retail store or similar retail-type establishment meets the
requirements for the small business exemption. For a full discussion of
the exemptions, see the ``Exemptions'' heading above. FSIS is
requesting comments on whether these exemptions are appropriate and
necessary for retail and Federal establishments. The preliminary cost
and benefits analyses below do not take the exemptions into account
because FSIS does not have sufficient data concerning the
establishments that would qualify for the small business exemption or
the volume of product that would be exempted from nutrition labeling
requirements. Therefore, FSIS requests comments on how the exemptions
would affect the costs and benefits of the proposed rule.
In addition to the proposed requirements discussed above, FSIS is
proposing to amend the nutrition labeling regulations to provide that
when a ground or chopped product does not meet the regulatory criteria
to be labeled ``low fat,'' a lean percentage claim may be included on
the label or in labeling as long as a statement of the fat percentage
also is displayed on the label or in labeling. Under existing
regulations, in order for the phrase ``____ percent lean'' to be used
on the label or in labeling of a product, the product must meet the
regulatory criteria for ``low fat.'' Most ground beef and hamburger
products do not qualify as ``low fat.'' Therefore, existing regulations
preclude the use of the term ``____ percent lean'' on these products.
FSIS extended the compliance enforcement date for nutrition labeling
requirements for ground beef and hamburger indefinitely, pending
publication of a final rule on percentage labeling for lean and fat on
ground beef and hamburger (59 FR 39941); therefore, producers and
retailers continue to use the term ``lean'' in percentage labeling on
the packages of ground beef and hamburger. FSIS is proposing to allow
this information on the label or in labeling for ground or chopped
products because many consumers have become accustomed to this labeling
on ground beef products, and because FSIS believes this labeling
provides a quick, simple, accurate means of comparing all ground or
chopped meat and poultry products. Under the preliminary cost analysis
below, FSIS provided a preliminary cost estimate for developing new
labels that include statements of the lean percentage and the fat
percentage. FSIS intends to develop a more detailed analysis of this
labeling provision in the final rule.
Preliminary Estimations of the Cost of the Proposed Rule
Making the voluntary program mandatory for the major cuts of
single-ingredient, raw meat and poultry products. FSIS believes that
the cost of providing nutrition labeling for the major cuts of single-
ingredient, raw meat and poultry products should not be significant.
Retail establishments can choose between providing nutrition
information through point-of-purchase materials or providing nutrition
information on labels. Processors may also provide the information on
labels or on point-of-purchase materials; however, FSIS would enforce
these requirements at retail. Point-of-purchase materials are available
for a nominal fee ($12.00 for members, $24.00 for nonmembers) through
the Food Marketing Institute's web site (http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.fmi.org). These
materials meet the point-of-purchase requirements in this proposed
rule. Also, FSIS intends to make point-of-purchase materials available,
free of charge, on the FSIS web site. Another factor that would
mitigate the cost impact of this requirement is that, based on the
nutrition labeling survey conducted in 1999, many stores are currently
providing nutrition information for the major cuts of single-
ingredient, raw products. As discussed above, the 1999 survey found
that 54.8 percent of stores surveyed provided nutrition information for
90 percent of the major cuts of single-ingredient, raw meat and poultry
products, in accordance with program guidelines.
FSIS estimates the one-time costs to retail establishments for
obtaining point-of-purchase materials that include nutrition
information for the major cuts of single-ingredient, raw meat and
poultry products would be about $0.7 million. FSIS is estimating that
all retailers would display point-of-purchase information for the major
cuts of single-ingredient, raw meat and poultry products, because this
is an inexpensive means of providing nutrition information for multiple
[[Page 4986]]
products and because this rule will not require that manufacturers
include nutrition labels on the major cuts of single-ingredient, raw
meat and poultry products. FSIS estimates that obtaining point-of-
purchase materials and making them available to consumers would take an
average of 30 minutes. As shown in Table 2 above, there were 69,500
retail stores in 1999 (excluding convenience stores that do not
normally sell meat products), and FSIS estimates salary and expenses
costs for providing nutrition information to be $20 per hour (69,500 *
0.5 * $20 = 0.7 million). This estimate does not take into account the
voluntary nutrition labeling survey results which show that many stores
currently provide nutrition information for the major cuts of single-
ingredient, raw products. Information concerning this cost is addressed
in the Information Collection Request submitted to OMB and in the
section on paperwork requirements below.
As discussed above, FSIS is proposing that many of the existing
exemptions from nutrition labeling requirements would apply to the
major cuts of single-ingredient, raw meat and poultry products.
However, FSIS is proposing that the small business exemption from
nutrition labeling requirements would not apply to the major cuts of
single-ingredient, raw products. As explained above, FSIS does not
believe that the reasons that necessitated the establishment of the
small business exemption, as explained in the January 6, 1993, final
rule, are applicable to the major cuts of single-ingredient products.
Also, because nutrition information for the major cuts of single-
ingredient, raw products may be provided on point-of-purchase
materials, FSIS is proposing that the provisions for providing
nutrition labeling by alternative means for products in packages that
have a total surface area available to bear labeling of less than 12
square inches would not apply to the major cuts of single-ingredient,
raw products.
Nutrition labeling of ground or chopped products. The costs of
required labels would be incurred by ground meat or poultry processors
supplying labeled products to retail stores for sale to consumers and
by retail establishments who grind or chop meat and poultry products in
their stores for sale to consumers. Costs would include the fixed costs
of equipment, the operating costs of printing labels, including
materials and labor, and the cost of nutrient analysis.
FSIS estimated the costs of nutrition labels based on the cost
analysis conducted for the ``Mandatory Safe Handling Statements on
Labeling of Raw Meat and Poultry Products'' proposed rule published
November 4, 1993 (58 FR 58922); the costs estimates were not revised in
the final rule in response to comments. The rationale for using the
``safe handling'' cost analysis is that the costs of the labels in
these two proposals would be comparable for cost estimation purposes.
FSIS is not using the regulatory impact analysis developed for the
nutrition labeling regulations for cost estimation purposes because
much less nutrient analysis will be required at this time than was
required when the 1993 nutrition labeling regulations were published
(January 6, 1993). There are currently much more data available for
nutrition labeling than were available when the 1993 nutrition labeling
regulations were published.
Safe Handling Cost Estimates
Fixed costs. The ``safe handling'' rule estimated the fixed costs
of installing or retrofitting labeling equipment for stamping,
printing, or affixing labels. The ``safe handling'' rule had estimated
the fixed costs of labeling fresh meat and poultry products for
processors to range from $50 to $100 million. These costs were based on
an estimate that there were somewhere between 50,000 and 100,000 labels
approved for use by processors that were affected and an estimated
average label modification cost of $1,000 (58 FR 58925).
The fixed costs of compliance with the ``safe handling'' labeling
rule for retail establishments were estimated to range from $144 to
$216 million. These estimates assumed that larger retailers would
modify their equipment to increase their label size to combine weight
and price information with safe handling instructions if their existing
equipment was incompatible. These estimates were based on the costs to
the then (i.e., 1992) existing 23,813 supermarkets (with annual sales
exceeding $2.5 million/year). Based on conversations with equipment
suppliers and two to three retailers, FSIS estimated that upgrading the
automated scales/wrapping systems to accommodate a larger label would
cost $6,000 to $9,000 per store. Assuming that all 24,000 (approx.)
supermarkets upgraded their equipment, the cost would range from $144
($6000 x 24,000) to $216 ($9000 x 24,000) million. FSIS estimated these
costs for large retail chains, i.e., supermarkets, because they
constituted three-fourths of total grocery stores sales. For example,
in 1992, of the total grocery stores sales of $360 billion (excluding
sales taxes), supermarkets accounted for $274 billion, or 76 percent.
FSIS also estimated these costs for large retail chains because FSIS
assumed that small retailers would produce a second label using
existing equipment to meet the ``safe handling'' rule requirements and,
therefore, would incur mostly operating costs rather than fixed costs
to meet the ``safe handling'' rule requirements.
Operating costs. The ``safe handling'' analysis assumed that all
meat and poultry products already included some form of commercially
prepared labels, and that the incremental cost of adding safe handling
instructions to the label would increase the total per label cost by
$0.0025 to $0.005. This estimate was also supported by the comment of
one large retail chain. In their response to the an earlier interim
rule that included a preliminary economic analysis (58 FR 43478), this
commenter stated that including the safe handling label, as part of
their price labels, would double the cost of their labels from $0.0025
to $0.005 per label. For firms that indicated that they would need
separate labels for the safe handling statement (e.g., the small retail
stores), the most frequent comment in response to the preliminary
analysis was that the labels for safe handling would cost $0.01 each.
In the ``safe handling'' rule, FSIS assumed that large retail chains
would incur the lower costs ($0.0025 to $0.005) per label by including
the safe handling statement as part of their price label. For the
smaller firms requiring separate labels for the safe handling
statement, FSIS assumed that their costs would be $0.01 per package.
The higher costs for small retailers can be explained by the absence of
economies of scale available to these retailers.
As discussed above, in 1992, large retail chains had sales that
accounted for 76 percent of total grocery store sales. In the ``safe
handling'' rule, FSIS rounded this number and assumed that 80 percent
of packages of meat and poultry products labeled and sold through
retail would be sold through large retail chains. The ``safe handling''
rule estimated that there were 10 billion packages of meat and poultry
product prepared and sold through retail. Therefore, the rule estimated
that 8 billion packages would be prepared and sold by large retail
chains and the remaining 2 billion packages would be prepared and sold
by small retail firms. The safe handling rule estimated that the 10
billion retail packages would have recurring costs associated with the
``safe handling'' rule of $50 million per year. This estimate assumed
that the 8 billion packages sold through large retail chains would have
recurring costs of $0.00375 (midpoint of $.0025 and $0.005) and the 2
billion packages sold
[[Page 4987]]
through small stores would have recurring costs of $0.01 per package.
In the ``safe handling'' rule, the additional labor costs for
applying the 2 billion separate safe handling labels by use of label
guns for small firms were estimated. Based on the number of staff years
at 160 and an average salary of $20,000 per year, the ``safe handling''
rule estimated the labor costs at about $3.2 million per year.
The ``safe handling'' rule did not estimate operating costs of
labeling for processors because they were expected to incur larger,
upfront, one-time fixed costs, associated with making permanent
modifications to labels.
Adjustments to the Costs in the Safe Handling Rule
Estimating the volume of ground or chopped products. As explained
above, the ``safe handling'' rule estimated the cost of labeling all
fresh meat products. The number and volume of products that would
require nutrition labels in this proposed rule are, however, much
smaller relative to the number and volume of products in the ``safe
handling'' rule, because the proposed rule would require nutrition
labels on only ground or chopped meat and poultry products. FSIS
adjusted the costs of the ``safe handling'' rule to reflect the costs
related to the volume of ground or chopped product produced.
In 1996, total U.S. annual production of ground beef was 7 billion
pounds (American Meat Institute Foundation, Relative Ground Beef
Contribution to the United States Beef Supply (May 1996): 5). The
American Meat Institute (AMI) report cited has not been updated.
However, according to AMI staff, total U.S. annual production of ground
beef was 7.2 billion in 1998, an increase of less than 3 percent. For
estimation purposes, FSIS believes the 1996 data are still valid. Based
on discussion with AMI staff members, approximately 50 percent (or 3.5
billion) of this output is sold through retail stores (the rest goes
through restaurants and institutions). As regards other ground or
chopped products such as poultry, pork, and turkey, AMI estimates that
for every 100 pounds of ground beef, 12.3 pounds of these competing
meats are produced (The American Meat Institute Foundation, Relative
Ground Beef Contribution to the United States Beef Supply (May 1996):
8). The estimate of 12.3 pounds is based on a survey sent by AMI to the
top 50 retail chains and wholesalers. No attempt was made to expand the
survey responses to a national level or develop estimates for the
entire retail sector. In the absence of any information that would
validate the survey responses for the entire retail sector, however,
FSIS employed these estimates as approximate trends. However, FSIS
invites comments and requests nationally representative data for the
retailers for analysis of the final rule.
To arrive at the total volume of ground or chopped meat and poultry
products sold in retail stores, FSIS first assumed that 50 percent of
total production, or 3.5 billion pounds, represented ground or chopped
beef sold in retail stores. Second, based on the AMI survey referred to
above, FSIS assumed that ground or chopped poultry and other meats
represented 12.3 percent of ground beef sales. Therefore, the total
annual volume of ground or chopped meat and poultry sold through retail
establishments amounted to 3.9 (3.5 + .4) billion pounds [3.5 billion +
(3.5 billion * 0.123 = .431 billion].
Fixed costs. As explained above, the ``safe handling'' rule had
estimated the fixed costs of safe handling labeling for processors to
range from $50 to $100 million. Also explained above, the fixed costs
of compliance with the ``safe handling'' labeling rule for retail
establishments were estimated to range from $144 to $216 million. The
estimation of these fixed costs assumed that larger retail stores would
modify equipment to increase their label size to combine weight and
price information with safe handling instructions if their existing
equipment was incompatible. In this rule, retail stores also might
modify equipment to increase their label size to combine weight and
price information with nutrition information.
To calculate the fixed costs of nutrition labeling of ground or
chopped products, FSIS adjusted the fixed costs in the ``safe
handling'' rule to account for existing equipment. FSIS believes that
many establishments have already incurred fixed costs required for the
``safe handling'' rule. For example the 1999 safe handling survey
revealed that 96.7 percent of large chains, 90.5 percent of large
independents, and 84.1 percent of medium/small independents had already
complied with the ``safe handling'' rule requirements. Therefore, as
explained in the ``Baseline'' section above, FSIS made the conservative
assumption that 80 percent of the estimated fixed costs were already
incurred by retailers and processors and only 20 percent of the
estimated fixed costs would be required for compliance with the
proposed rule. Hence the estimated fixed costs of the proposed rule
would range from $10 million to $20 million for processors and from
$28.8 million to $43.2 million for retailers.
Although these costs were estimated based on 1992 prices, there has
been virtually no change in their prices in the year 2000. For example,
the index number for producer prices for blast furnaces and steel mills
was 105.8 (1982 = 100) in 1992, and it was almost the same at 105.3
(1982 = 100) in July 2000. FSIS used this index number because these
producers also manufacture equipment used for stamping and printing
labels. Therefore, these costs are current and do not need any
updating. These costs are shown in columns 1 and 2, Table 8.
Operating costs. As explained above, the safe handling analysis had
assumed that all meat and poultry products already included some form
of commercially prepared labels, and that the incremental cost of
adding safe handling instructions to the labels would increase the
total per label cost by $0.0025 to $0.005. The ``safe handling'' rule
also estimated that the cost to firms that would need separate labels
for the safe handling statement would be $0.01 per label. As in the
``safe handling'' rule, in this rule, FSIS is assuming that large
retail chains would incur the lower costs ($0.0025 to $0.005) per
label, because they would include nutrition information as part of
their price labels. Similarly, consistent with the ``safe handling''
rule, for this rule, FSIS is assuming that smaller stores would apply a
separate label with nutrition information.
As explained above, in the ``safe handling'' rule, FSIS assumed
that large retail chains would account for 80 percent of all retail
packages labeled at retail and that the smaller firms would account for
20 percent of all retail packages. FSIS believes that the estimate that
80 percent of retail-labeled packages are sold through large retail
chains is likely to be valid in the year 2000 (without the need to
round up) because of a number of mergers, acquisitions, and
consolidations in this sector in the recent years. For example, Royal
Ahold bought Giant Foods, Albertson's bought American Stores,
SUPERVALUE bought Richfood, and Food Lion bought Hannaford (Sean
Mehegan, ``Merger Mania--Consolidation Changes the Face of the North
American Supermarket Sector,'' Meat & Poultry (September 1999): 22-25).
FSIS requests comments and data concerning whether the estimate that 80
of retail-labeled packages are sold through large retail chains is
accurate.
For the proposed rule, FSIS is assuming that a package of ground or
chopped meat or poultry would average
[[Page 4988]]
two pounds. FSIS believes that most packages of ground or chopped
product weigh at least a fraction over one pound; however, this product
is also sold in bulk size packages that are significantly over one
pound. Therefore, FSIS believes that two pounds is a reasonable
estimate of the average weight of a package of ground or chopped
product. If FSIS were to assume that the average size package were 1
pound, this assumption would double the estimated operating costs
below. FSIS requests comments on whether two pounds is an accurate
average weight estimate for packages of ground or chopped product.
Since the estimated annual volume of ground or chopped product sold
through retail is about 4 billion pounds, there will be 2 billion
packages (at two pounds each) requiring the labels. Because FSIS
assumes that 80 percent of these packages would be accounted for by
large firms, their corresponding shares of the packages would be 1.6
billion (80 percent of 2 billion) and small firms would account for the
rest, i.e., 0.4 billion packages (20 percent of 2 billion). Assuming a
mid-point cost of $0.00375 for the range of safe handling label costs
for large retail stores ($0.0025 to $0.005), the compliance cost for
these stores would be $6 million (1.6 billion packages * $0.00375). The
compliance cost for separate nutrition labels required by small firms
would be about $4 million (0.4 billion packages times $0.01 per
package). These costs were estimated in 1992, and there was an increase
of 20 percent in related costs in July 2000. This increase is based on
the producer price index numbers for plastics, foil, and coated paper
bags, the materials on which labels would be printed (1992 = 142.9,
July 2000 = 171.7). Therefore, these operating costs would increase by
$2 million to $12 million in current prices.
As explained above, the ``safe handling'' rule estimated the labor
costs of small firms applying separate safe handling labels by use of
label guns at about $ 3.2 million per year, based on 2 billion labels,
and 160 staff years at an average salary of $20,000 per year. According
to data from the Bureau of Labor Statistics, the average hourly
earnings in June of 1999 were $7.88 per hour. Assuming at least 2,000
work hours per year, the estimated annual earnings would be $15,760.
FSIS adjusted the costs in the ``safe handling'' rule based on this
earnings estimate. Therefore, FSIS revised the estimated ``safe
handling'' labor costs to small firms to $3.0 million per year (160
staff years times $16,000 per staff totals $2,560,000 per year, which
FSIS rounded to $3 million). Since these costs were for 2 billion
packages for the safe handling rule, the prorated costs for 400 million
packages for the proposed rule would be $0.6 million (400 million times
$3 million divided by 2 billion). Therefore, estimated total operating
or recurring costs associated with the proposed rule would be $12.6 (12
+ 0.6). These costs are shown in Table 8, row 2, column 3.
The ``safe handling'' rule did not estimate operating costs of
labeling for processors because they were expected to incur larger,
upfront, one-time fixed costs, associated with making permanent
modifications to labels. Therefore, Table 8, row 1, column 3, reports
their operating costs as ``Not Applicable'' (NA). The recurring costs
of nutrition labeling for processors other than retail establishments
are not estimated in this rule because, again, FSIS expects these
processors to incur larger, upfront, one-time fixed costs, associated
with making permanent modifications to their existing labels.
Paperwork burden costs. FSIS estimates that the one-time
development and recordkeeping costs associated with nutrition labels
for ground or chopped products for Federal establishments and retailers
will total $8.8 million. As explained above, FSIS estimates the one-
time costs to retail establishments for obtaining point-of-purchase
materials that include nutrition information for the major cuts of
single-ingredient, raw products will be about $0.7 million. The
paperwork burden cost estimates for the required nutrition labels for
ground or chopped products are based on the time required to develop 3
nutrition labels (120 minutes each), the time required for
recordkeeping for the supporting data at Federal and retail
establishments (5 minutes), and the time required for Federal
establishments to submit label approval applications to FSIS (15
minutes). FSIS estimates that there are 2,489 Federal establishments
affected by the rule and 69,500 retail establishments and estimates
salary and expenses for these activities to be $20 per hour.
Information concerning these costs is addressed in the Information
Collection Request submitted to OMB and the Paperwork Requirements
section below.
Table 8 shows that total operating compliance costs associated with
nutrition labels for ground or chopped product are estimated at $12.6
million.
Table 8.--Estimated Compliance Costs for Ground or Chopped Products ($ Million)
----------------------------------------------------------------------------------------------------------------
Fixed costs Paperwork
-------------------------- Operating burden
Low High costs costs
----------------------------------------------------------------------------------------------------------------
Processors.................................................. 10.0 20.0 NA .3
Retailers................................................... 28.8 43.2 12.6 8.5
---------------------------------------------------
Total................................................... 38.8 63.2 12.6 8.8
----------------------------------------------------------------------------------------------------------------
Discounted value of compliance costs. The low and high estimates of
fixed costs were added to the operating costs and paperwork burden
costs estimated above. Therefore, FSIS obtained two series of costs,
low and high, for a period of 20 years. The low estimate was $60.2
million per year ($38.8 million + 12.6 million + 8.8 million) and the
high cost estimate was $84.6 million ($63.2 million + $12.6 million +
$8.8 million). These series were discounted at 7 percent to compare
them with discounted benefits, which are also discounted at 7 percent.
It was assumed that the costs would be incurred in the middle of each
year for the next 20 years. The results revealed that the present
values of compliance costs for the next 20 years (from 2001 to 2020)
ranged from $659.69 million to $927.05 million. Other than the
paperwork costs discussed above, there should not be many costs
associated with nutrition labels that would exceed the estimates in the
``safe handling'' rule. Nutrient content is dependent on fat levels,
and there is a direct relationship between fat and other nutrients.
Producers should be able to use available data or to extrapolate from
existing data to develop the data for nutrition labels. In addition,
FSIS will develop a list of published sources of information concerning
the nutrient content of ground or chopped products,
[[Page 4989]]
so that industry could obtain available literature from local
libraries. This information would facilitate the development of
nutrition labels for ground or chopped products. FSIS requests comments
and data on any additional costs associated with nutrition labels that
were not included in this preliminary cost analysis.
Although nutrition labels are not currently required on single-
ingredient, raw ground or chopped products, such labels are often
provided voluntarily on these products. According to information
submitted by CSPI, a number of major supermarket chains, including
Dominick's, Fred Meyer, Jewel, Kroger, Wegman's, Winn-Dixie,
Albertson's, and some Lucky and Safeway stores, now include full
``Nutrition Facts'' labels on their ground beef (Bonnie Liebman,
``Where's the Beef Labeling,'' Nutrition Action Healthletter (June
1999): 8-11). Because FSIS does not have complete information
concerning the volume of ground or chopped packages that bear nutrition
labels, FSIS is estimating the costs of labels for all packages of
ground or chopped product in the cost estimates above.
Impact of estimated costs. The preceding estimates of fixed,
operating and paperwork burden compliance costs for the proposed
requirements concerning ground or chopped product at $60.2 to $84.6
million are not likely to be excessive relative to the volume of output
of ground or chopped meat and poultry products sold at retail. For
example, as noted above, the volume of these products is estimated at
3.9 billion pounds. Therefore, these costs would range from 1.5 to 2
pennies per pound ($60.2 million/3.9 billion pounds to $84.6 million/
3.9 billion pounds). FSIS has not conducted a thorough analysis of how
the costs to Federal and retail establishments would affect the price,
supply, and demand of ground or chopped products. Similarly, FSIS has
not thoroughly evaluated how any changes in consumer behavior that may
occur as a result of this rule would affect the price, supply, and
demand of ground or chopped products.
Percentage Labeling
The proposed percentage labeling for ground or chopped products
would not result in significant costs because such labeling would be
optional rather than mandatory. If retailers and other producers found
this labeling to be costly, they would simply not exercise this option.
Because FSIS extended the compliance enforcement date for use of the
term ``lean'' for these products, pending publication of a final rule
on percentage labeling for lean and fat on ground beef and hamburger,
many of these products already bear these statements on their labels.
If producers chose to develop new labels, the costs per label would be
comparable to those for printing nutrition labels ($0.0025 to $0.05 per
label if the information is included as part of their price label, and,
$0.01 per label if they developed separate labels). FSIS requests
comment on the costs and benefits of percent fat/percent lean labeling
on ground or chopped products.
Benefits
The benefits of nutrition labeling depend on the extent to which
consumers change their food consumption in favor of products that are
more nutritious. As noted earlier, the absence of nutrition labeling to
indicate nutrition contents of ground or chopped meat and poultry
products and the major cuts of single-ingredient, raw products does not
allow consumers to get adequate information for making their purchasing
decisions. Provision of nutrition labels and point-of-purchase
materials would disseminate nutrition information and enhance
consumers' food purchasing decision-making process.
Consumption habits vary with knowledge of nutrition and health,
preference for healthful diets, and socioeconomic status of different
segments of the population. For example, consumers with preferences for
healthful diets are likely to select products with lower fat and
cholesterol levels to assist in the reduction of risk for coronary
heart problems and cancerous diseases. Some consumers might perceive
that a product is of higher quality or more nutritious if it has lower
fat and cholesterol contents. Availability of nutrition labels on
ground or chopped meat and poultry products and nutrition information
for the major cuts of single-ingredient, raw products may help
purchasing decision-making by these select groups of consumers.
Literature review of impact of labeling on diet quality. Nutrition
labels on products such as cereals have existed for over two decades.
Research studies on the effect of nutrition labeling on diet quality
for these non-meat and poultry products indicate a positive
relationship between these variables. Kreuter et al. (1997) analyzed
survey data of 885 adult patients from four family medical clinics in
Missouri (see the ``References'' section below for full citations of
the literature referred to in this discussion). To participate,
patients completed a self-administered survey while waiting to see
their physicians. The results revealed that patients eating diets lower
in fat were much more likely (51% versus 26%) than patients whose diets
were higher in fat to report that nutrition labels influenced their
food purchasing decisions.
Guthrie et al. (1995) linked USDA's 1989 Continuing Survey of Food
Intakes by Individuals (one database) to Diet and Health Knowledge
Survey (another database). They concluded that label use appeared to be
associated with the consumption of diets that were higher in vitamin C
and lower in cholesterol.
Neuhouser et al. (1999) analyzed data from a survey of 1,450 adult
residents in Washington State. The survey assessed nutrition label use,
fat-related diet habits, fruit and vegetable consumption, diet-related
psychosocial factors, health behavior, and demographic characteristics.
They concluded that label use was significantly associated with lower
fat intake and, after controlling for all demographic, psychosocial,
and behavioral variables, label use explained 6% of the variance in fat
intake (their conclusion had a probability of 99.9%).
Mathios and Ippolito (1998) analyzed the effect of nutrition
information in advertising and labels on consumption of food cereals
with fiber content. They divided their study into two periods: First,
the period, 1978-1984, when the FDA permitted printing of fiber content
on cereal boxes but did not permit printing of any health claims, and
the period 1985-87 when health claims were permitted. They concluded
that in concert with an increase in fiber intake of cereals in their
diets, the average intakes of fat, saturated fat, and cholesterol for
both men and women declined during both the periods, albeit, the
decline was greater during the second period relative to the first.
They concluded that the increase in fiber and the decrease in fat and
cholesterol consumption were associated with the consumption of labeled
cereals.
Preliminary benefits analysis. FSIS consulted with ERS to develop
the following empirical analysis of the benefits of nutrition labeling.
The estimated benefits take the form of reductions in the incidence of
coronary heart disease and three types of cancer which may accrue as
consumers improve their diet quality through increased use of nutrition
information generated by the regulation. FSIS used survey data on
nutrient intake and label use to correlate intake of fat, saturated
fat, and cholesterol to usage of existing nutrition information. The
Agency estimated the value of the potential changes from intake of fat,
saturated fat,
[[Page 4990]]
and cholesterol that could occur as consumers respond to the newly
available nutrition information. FSIS applied the model developed by
Zarkin, et. al. which links changes in the serum cholesterol rate to
changes in the percentage of total calories from polyunsaturated fat,
saturated fat, and dietary cholesterol (Gary A. Zarkin, Nancy Dean,
Josephine A. Mauskopf, and Richard Williams, ``Potential Health
Benefits of Nutrition Label Changes,'' American Journal of Public
Health 83(5) (May 1993): 717-724; Gary A. Zarkin, Nancy Dean, Josephine
A. Mauskopf, and Dierdre M. Neighbors, ``Estimated Benefits of
Nutrition Label Changes: Final Report, Volume 1,'' Center for Economics
Research, Research Triangle Institute, Research Triangle Park, NC,
27709. April 1991). Changes in serum cholesterol are then used to
estimate the health outcomes, which are reductions in the number of
cases and mortality from three cancers (breast, colorectal, and
prostate) and coronary heart disease. Finally, the Agency attached
economic value to the public health changes by estimating the implied
value of life associated with reductions in premature mortality.
To determine how much of a behavioral response and change in
dietary intake may result from providing more nutrition information on
meat and poultry products, FSIS makes the following assumption: The
Agency assumes that when labels and other sources of nutrition
information are provided for raw meat and poultry products that
nutrition information usage rates will rise to match label usage rates
for food products as a whole (see Table 3). Currently, some nutrition
information is provided for some single-ingredient, raw meat and
poultry products, but the information is not currently required.
Mandatory nutrition labeling rules for the major cuts of single-
ingredient, raw products and ground or chopped products would mean the
nutrition information provided for these products would be comparable
to that provided for other food products. FSIS therefore could
reasonably assume that nutrition information usage rates for raw meat
and poultry products would then become the same as the label usage
rates for all foods taken together. For example, before mandatory
nutrition information labeling, the data show that about 17 percent of
men look for nutrition information on meat ``Often'' (Row 2 of table
3). In this analysis, then, FSIS assumed that after mandatory nutrition
information labeling, 26.7 percent of men would use the nutrition fact
panel or point-of-purchase materials for meat products, which is the
label usage rate for all foods (Row 1 of table 3). Similarly, the
Agency assumes that the percentage of women using nutrition information
on meat products ``Sometimes'' would rise from 18 percent to 32.6
percent.
What does this mean for diet quality? Here, FSIS made another
(admittedly strong) assumption: The Agency assumed that as nutrition
information usage rates rise for consumers eating meat and poultry,
dietary patterns will change in a manner consistent with current data.
As shown above, there is strong statistical evidence that people who
use nutrition information to guide their food consumption decisions
have healthier diets. While other factors may be at work, and the role
of information use in causing dietary changes is unclear, FSIS makes
the assumption that the provision of additional nutrition information
and making that information available to more consumers will lead to
behavioral shifts and increased diet quality. Thus, FSIS assumes the
effect of providing new information for meat and poultry products would
make consumers who NEVER used nutrition information for meat and
poultry products become aware of the diet implications of their choices
in meat and poultry products. These consumers would then choose to
consume the same mix of products as people who are currently aware of
the nutritional quality of meat and poultry products. For example, men
who currently do not look for nutrition information on meat in the
absence of mandatory nutrition information labeling who would begin
using this information ``Sometimes'' after labeling is in place would
see a decrease in fat intake from 98 grams to 92.5 grams.
Under these assumptions, then, FSIS could see how requirements for
mandatory nutrition information labeling on raw meat and poultry
products could possibly affect diet quality. To reach the values shown
in table 6, FSIS multiplied each cell in table 5 by the associated
percentage of label use (nutrition facts panel use) from table 3. By
doing this, FSIS increased the numbers of people in the ``always'' and
``sometimes'' cells, and decreased the number of people in the
``rarely'' and ``never'' cells, so that the distribution of label usage
on meat and poultry products would reflect the distribution of label
usage on all products. Aggregating across categories, FSIS got a new
weighted average intake, which could be seen after the imposition of
mandatory labeling requirements.
Table 9.--Change in Intake Due To Increased Label Usage
----------------------------------------------------------------------------------------------------------------
Intake prior
to mandatory After Percentage
nutrition adjusting for decrease in
labeling of increased intake
meat & poultry label usage
----------------------------------------------------------------------------------------------------------------
Men:
Total Fat................................................... 92.51 91.31 1.30
Saturated Fat............................................... 31.12 30.69 1.37
Cholesterol................................................. 339.07 334.95 1.21
Women:
Total Fat................................................... 60.16 58.57 2.65
Saturated Fat............................................... 19.71 19.21 2.55
Cholesterol................................................. 210.53 208.16 1.13
----------------------------------------------------------------------------------------------------------------
Note: Fat intake in grams, cholesterol in milligrams.
[[Page 4991]]
Table 10.--Change in Percentage of Calories From Fat and Cholesterol Intake Due To Increased Label Usage
----------------------------------------------------------------------------------------------------------------
Intake prior
to mandatory After Percentage
nutrition adjusting for decrease in
labeling of increased calories from
meat & poultry label usage fat or intake
----------------------------------------------------------------------------------------------------------------
Men:
Total Fat................................................... 33.44 33.33 0.11
Saturated Fat............................................... 11.19 11.14 0.04
Cholesterol................................................. 339.07 334.95 4.12
Women:
Total Fat................................................... 32.49 32.37 0.11
Saturated Fat............................................... 10.64 10.54 0.10
Cholesterol................................................. 210.53 208.16 2.37
----------------------------------------------------------------------------------------------------------------
Note: Fat and saturated fat values are percent calories from fat. Cholesterol is mg.
Evaluation of health effects. Based on epidemiological research,
FSIS related the reductions estimated in Table 10 to estimated decrease
in incidence of major diseases associated with consumption of fat and
cholesterol. The diseases considered in this analysis include three
types of cancer--breast, prostate, and colon/rectal--and coronary heart
disease. Epidemiological studies of the relationships between dietary
fat and cholesterol intake and incidence of cancer and coronary heart
disease indicate that saturated and polyunsaturated fat and cholesterol
are converted into serum cholesterol. Serum cholesterol has an impact
on the incidence rates of these diseases. FSIS used the following
equation from Zarkin et al. (1993) to convert fat contents into the
change in serum cholesterol (SC) rate, in milligram/deciliter (mg/dl):
(1) SC (Mg/dl) = 2.16S - 1.65P + 0.097C
Where SC is serum cholesterol, S is the change in percentage of total
calories represented by saturated fat, P is the change in percentage of
total calories represented by polyunsaturated fat, and C is the change
in dietary cholesterol measured in mg/1000 calories.
FSIS substituted the estimated values of percentage changes in
saturated fat and cholesterol intake from the last column of Table 10
into this equation. Since FSIS did not have separate data for
polyunsaturated (P) fat, it was assumed that P would be one-third of
total fats, as was also assumed by Zarkin et al. The estimates of serum
cholesterol for male and female consumers are as follows:
Table 11.--Reduction in Serum Cholesterol and Change in Mortality
----------------------------------------------------------------------------------------------------------------
% Change in % Change in %
calories calories Change in Change in Reduction
from total from sat. cholesterol serum in
fat fat intake cholesterol mortality
----------------------------------------------------------------------------------------------------------------
Men............................................ 0.11 0.04 4.12 0.399 0.0240
Women.......................................... 0.11 0.10 2.37 0.231 0.0139
----------------------------------------------------------------------------------------------------------------
FSIS used the calculated values of SC presented above to estimate
incidence of breast, prostate, colon/rectal cancer, and coronary heart
disease. Zarkin et al. (1993) concluded that an increase in serum
cholesterol by 20 mg/dl was associated with a 1.2-percent increase in
the incidence of each of these diseases. FSIS employed this rate to
convert reductions in total fat, saturated fat, and cholesterol in
Table 10 into SC. It is estimated that the reduction in mortality
associated with changing dietary pattern from mandatory nutrition
information labeling are 0.024 percent for men, and about 0.014 percent
for women.
Table 12.--Reduction in Mortality, Annual New Cases of Mortality, and Estimated Lives Saved
----------------------------------------------------------------------------------------------------------------
Reduction in Annual new cases of Lives saved
mortality (%) mortality --------------------------------
-------------------------------------------- 5 6 7
1 2 3 4 --------------------------------
--------------------------------------------
Men Women Men Women Men Women Total
----------------------------------------------------------------------------------------------------------------
Breast Cancer...................... ......... 0.0139 ......... 41,200 0 6 6
Prostate Cancer.................... 0.0240 ......... 31,900 ......... 8 0 8
Colorectal Cancer.................. 0.0240 0.0139 28,000 28,000 7 4 11
Coronary Heart Disease............. 0.0240 0.0139 231,332 228,769 55 32 87
----------------------------------------------------------------------------------------------------------------
Table 12 presents data on the annual new cases of mortality
associated with the three types of cancer and coronary heart disease
for men and women in the United States in 1998. Data for the number of
deaths came from the National Center for Health Statistics (coronary
heart disease) and the American Cancer Society (cancer). Data on
colorectal cancer were not available by gender; FSIS assumed the
estimated 56,000 cases were distributed equally between men and women.
Estimating the benefits of preventing premature death. The benefits
of the
[[Page 4992]]
proposed nutrition information labeling rule would be the lives saved
due to the estimated reductions in mortality rates associated with
these diseases. However, placing reduction of the risk of premature
death in an economic context is difficult and controversial (for an in-
depth analysis of this issue, see Fred Kuchler and Elise Golan,
``Assigning Value to Life: Comparing Methods for Valuing Health
Risks,'' Agricultural Economic Report No. 784, U.S. Dept. Agric., Econ.
Res. Service, Washington, DC, Nov. 1999). The problem is that there is
no market for reducing diet-related fatal risks. If food were marketed
by risk levels (say, probabilities of inducing cancer or heart disease)
and consumers treated advertised risk levels like they do other
objectively measurable product characteristics (e.g., weight or
volume), there would be little difficulty in valuing food safety.
Product prices could be statistically associated with risk levels,
yielding the risk-dollar trade-off consumers make. That is, FSIS could
measure, based on consumer purchases, the dollar value consumers attach
to particular types of risk reduction.
There is no price that can be tabulated from commercial
transactions that reflects the value of reducing diet-related fatal
risks. Actions that individuals might take to reduce these risks do not
leave a behavioral trail for analysts to follow. This information void
makes it difficult to evaluate programs that might reduce diet-related
risks. In particular, there is no obvious dollar value to assign to the
major benefit of such programs, namely lives saved.
Ultimately, FSIS wanted to monetize the benefits of diet-related
fatal health risk reduction. Other risks do leave a clear behavioral
trail that analysts have followed, measuring the risk-dollar trade-off
individuals make. The Agency's goal was to find a method of
transferring market-based risk-dollar trade-off estimates to diet-
related fatal cancer risks.
The most studied risk choices are those for on-the-job risks of
accidental injury and death. Analysts have estimated the compensation
required to induce workers to accept such risks. Many studies of labor
market behavior have been carried out because the wide range of risk
levels workers accept and the wide range of wages paid are amenable to
statistical analysis. Available evidence suggests that workers'
subjective assessments of risks they face are plausible (W.K. Viscusi,
Fatal Tradeoffs--Public & Private Responsibilities for Risk. New York:
Oxford University Press, 1992).
Viscusi (1992) summarized the empirical work estimating the value
of risk of premature death. Several studies estimate the risk-dollar
trade-off in the labor market by dividing the wage premium for risky
jobs by the risk of a fatal job injury. Drawing on the compiled results
of these studies, he stated: ``Although the estimates of the risk-
dollar tradeoff vary considerably depending on the population exposed
to the risk, the nature of the risk, and similar factors, most of the
reasonable estimates of the value of life are clustered in the $3 to $7
million range'' (p. 73). Thus, compensating wages indicate that, on
average, industrial workers value a statistical life at $5 million
(December 1990 dollars), the midpoint of the range. ERS currently uses
the $5 million per life estimate (adjusted upwards for inflation to
2000 dollars) to measure the benefits of preventing premature death
from foodborne diseases caused by microbial pathogens (such as E. coli
O157:H7, Salmonella, and Listeria monocytogenes.) (Crutchfield,
Roberts, Buzby, and Frenzen, `` Food Safety Efforts Accelerate in the
1990's,'' Food Review, 23 (3), September-December 2001, forthcoming).
This estimate has been used by other government agencies to evaluate
the benefits of regulations designed to reduce the risk of premature
death. For example, The Food and Drug Administration (Procedures for
the Safe and Sanitary Processing and Importing of Fish and Fishery
Products Final Rule, 60 FR 65095) and the Consumer Product Safety
Commission (Miller et al., ``The Consumer Product Safety Commission's
Revised Injury Cost Model,'' Peer Review Draft Prepared for the U.S.
Consumer Product Safety Commission, July 1, 1997) currently use
Viscusi's mid-point value of $5 million for each life saved. (Kuchler
and Golan, ``Assigning Value to Life: Comparing Methods for Valuing
Health Risks,'' Agricultural Economic Report No. 784, U.S. Department
of Agriculture, Economic Research Service, Washington, DC, November
1999, page 25). However, other agencies use lower life values in their
analyses. FSIS requests comments on whether $5 million is an
appropriate value of life estimate.
FSIS used the $5 million estimate as reflecting willingness to pay
to avoid health risks. This is not the value an individual would pay to
save his own life, but the aggregate value paid by many individuals to
reduce a small risk of death each faces. To make this transfer, FSIS
assumed that individuals make consistent risk choices, reducing health
risks as much as their budgets allow. The Agency assumed individuals
focus on the likelihood of health outcomes and how bad the outcomes
might be, without regard to the different physical characteristics of
hazards that give rise to health risks. The assumption critical for
making the transfer from valuing job risks to valuing cancer risks is
that individuals value years of life, and all years are equally
valuable. All individuals are assumed to value a year of life equally.
FSIS adjusted for differences between years of life lost to cancer
and heart disease fatalities and years of life lost to workplace
fatalities. The value of statistical life estimate is based on a worker
anticipating a fatal injury and losing an average life expectancy of
36.5 years (W.K. Viscusi, W.K. Cigarette taxation and social
consequences of smoking. In James M. Poterba (ed.), Tax Policy and the
Economy. Volume 9. Cambridge: MIT Press for the National Bureau of
Economic Research, 1995). Potential life years lost to cancer and heart
disease deaths were calculated by FSIS using data from National Centers
for Health Statistics (National Center for Health Statistics, National
Vital Statistics Report 48 (11) (July 24, 2000): 167). NCHS reports the
number of years lost before age 75 per 100,000 population under the age
of 75. These data were divided by the number of cancer and heart
disease deaths for the population under 75 years of age to estimate the
average number of life years lost up to age 75. The average number of
life years lost were 14.9 for breast cancer, 3.9 for prostate cancer,
9.56 for colorectal cancer, and 10.2 for coronary heart disease. Thus,
to calculate a value of life lost to cancer or heart disease, FSIS
adjusted the $5 million estimate downward to reflect the fewer years of
life lost to cancer or heart disease, compared to work-related deaths.
This calculation is similar to that carried out by Viscusi for
estimating the value of statistical lives lost to environmental tobacco
smoke (Viscusi, 1995).
FSIS treated the last 36.5 years of life (L36.5) as a
capital asset with a current value of $5 million. If the risk market
could be characterized as an efficient market, the asset price should
be equal to the present value of the service flow the asset produces.
[GRAPHIC] [TIFF OMITTED] TP18JA01.069
R is the (assumed) constant annual value of life and r is the time
preference
[[Page 4993]]
rate used to discount future benefits. Consider now the case of an
individual facing an expected loss of 10.2 years of life from coronary
heart disease. From this perspective, the value of the last 10.2 years
of life for a victim of coronary heart disease is
L10.2 = e-26.3rr-1R(1 -
e-10.2r).
The equations for both L36.5 and L10.2 can be
solved for R and equated, yielding
L10.2 = L36.5 e-26.3r(1 -
e-36.5r)-1.
The value of cancer avoidance depends on an individual's rate at which
future years of life are discounted. At an interest rate of 7 percent,
the value is $636,755. At an interest rate of 3 percent, the value is
$1,056,261.
This estimate is in December, 1990 dollars. Using the CPI-U to
update this estimate from 1990 to 2000 dollars (CPI-U = 133.8 in
December 1990, and 171.3 average for 2000), the value becomes $815,218
(7 percent discount rate) and $1,352,298 (3 percent) in 2000 dollars.
Similar calculations were made for deaths associated with the other
three diseases considered (which take into account the different number
of life years lost for each disease). The results are reported in
Tables 13 and 14. To arrive at an estimate of the benefits associated
with reductions in mortality due to changes in fat and cholesterol
intake, FSIS multiplied the dollar value assigned to each premature
death prevented by the number of lives saved due to changes in diet
quality. This estimate is reported for each disease as ``Total benefits
per year'' in Tables 13 and 14. The total for all diseases is $86.6
million dollars at a 7 percent discount rate and $145.2 million at 3
percent.
It should be noted that the calculations used to estimate present
value explicitly account for the time factor associated with delayed
health impacts of dietary change. Decreases in intake of saturated fat,
fat, and cholesterol will reduce the incidence of heart disease and
cancer, but not immediately--the reductions in illness and death will
begin to occur years into the future. However, the formulas used for
calculating the present value of the benefits explicitly take this into
account, for they reflect the value placed on lost years of life
occurring in the future.
Table. 13--Estimated Lives Saved and Associated Economic Benefits, Using a 7 Percent Discount Rate
----------------------------------------------------------------------------------------------------------------
Prostate Colorectal Coronary heart
Breast cancer cancer cancer disease All diseases
----------------------------------------------------------------------------------------------------------------
Deaths Per Year................. 41,200 31,900 28,028 228,231 329,359
Lives Saved Due to Dietary 6 8 11 87 111
Changes from Labeling..........
Years of Life Lost Per Premature 14.9 3.9 9.6 10.2 N/A
Death..........................
Dollar Value of 1 Life Saved ($) 1,032,665 384,390 780,670 815,218 N/A
Total Benefits Per Year ($)..... 5,906,020 1,513,329 8,273,399 70,936,607 86,629,355
20 Year Present Value ($)....... 62,568,456 16,032,277 87,648,507 751,503,430 917,752,620
----------------------------------------------------------------------------------------------------------------
Note: Cancer deaths are for 2000, heart disease deaths are for 1998. Number of lives saved is rounded to the
nearest integer. All benefits estimates are in year 2000 dollars.
Table. 14--Estimated Lives Saved and Associated Economic Benefits, Using a 3 Percent Discount Rate
--------------------------------------------------------------------------------------------------------------------------------------------------------
Coronary heart
Breast cancer Prostate cancer Colorectal cancer disease All diseases
--------------------------------------------------------------------------------------------------------------------------------------------------------
Deaths Per Year (1998)................................... 41,200 31,900 28,028 228,231 329,359
Lives Saved.............................................. 6 8 11 87 111
Years of Life Lost Per Death............................. 14.9 3.9 10.6 10.2 N/A
Dollar Value of 1 Life Saved ($)......................... 1,844,723 570,731 1,395,308 1,352,298 N/A
Total Benefits Per Year ($).............................. 10,550,343 2,246,945 14,787,213 117,670,918 145,255,419
20 Year Present Value ($)................................ 156,962,464 33,428,870 219,996,395 1,750,646,120 2,161,033,850
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: Cancer deaths are for 2000, heart disease deaths are for 1998. Number of lives saved is rounded to the nearest integer. All benefits are in year
2000 dollars.
It should be kept in mind that these estimates are based on annual
data, and represent only one year's benefits. FSIS assumed that the
reduction in mortality would continue each year. Using a twenty-year
time horizon, FSIS estimated the present value (discounted at seven
percent and three percent) of continuing reduction in premature deaths.
This estimate was $918 million for all diseases at 7 percent, and
$2.161 billion at 3 percent. FSIS requests comment on the benefits
analysis above.
Summary of costs and benefits of the proposed nutrition labeling
rule. As discussed above, FSIS' preliminary analysis does not allow for
a comparison of the net benefits among the regulatory options
considered.
For the proposed rule, the present values of benefits estimated in
the two scenarios with 7 and 3 percent discount rates, respectively,
range from $918 million to $2.161 billion. The present value (at a 7
percent discount rate for 20 years) of annualized fixed costs,
operating and paperwork burden costs (including paperwork costs for
providing nutrition information for the major cuts) for the lower bound
estimate amounts to $659.69 million. In case the higher estimate of
fixed costs is used, the fixed, the operating, and the paperwork burden
costs amount to $927.05 million, at a 7 percent discount rate for 20
years.
Percentage labeling. This proposed rule would allow but would not
require a statement of the fat and lean percentage in ground or chopped
products. FSIS believes that this nutrition information helps consumers
make better food choices and provides incentives to producers to
continue producing nutritionally-improved products which contribute
substantially to the health benefits associated with nutrition
labeling. However, FSIS does not have the data necessary to quantify
these benefits. FSIS requests comments concerning the benefits of
percentage labeling on ground or chopped products.
[[Page 4994]]
Regulatory Flexibility Act (RFA)--Preliminary Analysis
Based on the cost analysis above, FSIS has made an initial
determination that this rule will not have a significant economic
impact on a substantial number of small entities, as defined by the
Regulatory Flexibility Act (5 U.S.C 601). In the cost analysis above,
FSIS estimated that the total costs for required nutrition labels on
ground or chopped products would be between 1.5 and 2 pennies per
pound. Also, as stated above, FSIS believes that the cost of providing
nutrition labeling for the major cuts of single-ingredient, raw meat
products should be negligible. FSIS estimates the total one-time costs
to all retail establishments combined for obtaining point-of-purchase
materials that include nutrition information for the major cuts of
single-ingredient, raw products will be about $0.7 million.
The data in Table 1 in the ``Baseline'' section above suggest that
about one-half of the poultry plants were large (28 out of 63) in 1999.
The number of ``small'' and ``very small'' poultry plants was 23 and 10
respectively. In the absence of the availability of any data on
production levels of these plants, FSIS assumes that the very small
plants with less than ten employees are likely to produce less than
100,000 pounds per ground poultry product. This assumption is not
unrealistic because poultry grinding is a labor-intensive process and
less than ten employees are not likely to produce more than 100,000
pounds per ground product because these employees also process other
products in these plants. Based on this assumption, 10 very small
poultry establishments (or only 15% of all poultry establishments) are
likely to be exempt from nutrition labeling requirements for ground or
chopped products. However, these establishments would not be exempt if
they are owned by a large corporation that owns several plants and
employs 500 or more workers among all of its plants or produces more
than 100,000 pounds of a particular ground product in total among all
of its plants. FSIS did not have data linking these establishments to
their corporate ownership.
The EFD indicates that most of the ground meat producing plants are
very small. For example, of the 2,426 ground meat establishments, 1470
or 60% are very small. The number of small and large ground meat
establishments are 843 and 68, respectively. Therefore, assuming that
the very small establishments produce less than 100,000 pounds of a
particular ground meat product, 60% of all these plants would be exempt
from nutrition labeling requirements for ground or chopped products. In
practice, the number of plants that would be exempt may be smaller than
60 percent because many of these plants may be owned by large, multi-
plant corporations. However, FSIS does not have data on corporations
that own these individual establishments.
As discussed above, FSIS believes that a significant amount of
ground beef is processed at retail. Table 2 in the ``Baseline'' section
above shows the number of retail stores in 1999. Most of these stores
grind beef. However, FSIS does not have specific data concerning the
levels of ground beef ground at retail or on the size of retail stores
that process ground beef. FSIS researched Census data for this
information, but specific information related to retail establishments
processing ground or chopped product was unavailable. Therefore, FSIS
does not currently have all the data necessary for a comprehensive
analysis on the effects of this rule on small entities. In addition to
the lack of data on retail stores producing ground or chopped product,
FSIS does not have data on the specific types and quantities of ground
products produced in individual plants to determine the number of
single-plant facilities or multi-plant companies or firms that would be
exempt from this regulation. Therefore, FSIS is requesting this
information and inviting comments concerning potential effects. In
particular, FSIS is interested in determining the number and kind of
small entities that may incur benefits or costs from implementation of
this proposed rule.
FSIS will make available a list of published sources of information
so that industry can obtain literature from local libraries. This
information will assist in the development of nutrition labels for
ground or chopped products. This list of published sources of
information should also help minimize the economic effect of this rule
on small entities.
FSIS is cognizant of the possibility that while the exempted
establishments would not have to incur labeling costs, they might not
realize benefits of greater sales of the labeled products, in case they
choose not to nutritionally label their products. This is because if
demand for the labeled product increases relative to demand for non-
labeled products, the exempt establishments would lose their market
shares to the nonexempt establishments producing nutritionally labeled
products. Therefore, to keep their market shares, these exempt
establishments are likely to voluntarily include nutrition information
on the product label. Such a strategy would minimize the adverse impact
on these smaller establishments. It would, however, also increase their
costs associated with labeling. Economic theory dictates that these
establishments would compare the costs of nutrition labels with the
benefits of retaining their market shares and would decide to label
their products if the benefits of increasing the market shares exceed
the label costs.
Nutrition labeling would be required, either on the product label
or on point-of-purchase materials, for the major cuts of single-
ingredient, raw product. Therefore, if manufacturers do not provide
nutrition information on the label, retailers would be required to
provide this information at the point-of-purchase or on product labels.
However, as noted above, this requirement should not impose major costs
or other burdens because many stores are currently providing nutrition
information for these products, point-of-purchase materials are
available for a nominal fee through FMI's web site ($12.00 for members,
$24.00 for nonmembers), and FSIS intends to make point-of-purchase
materials available, free of charge, on the FSIS web site.
The economic impact on retail stores is likely to be minimal
because recently there has been considerable consolidation of these
stores due to mergers and acquisitions resulting in an increased market
share of large retailers relative to small ones. For example, recently
Royal Ahold, the Dutch Conglomerate, bought out Giant Food. Earlier
last year, Ahold also announced the pending purchase of Supermarket
General-II Holdings Corporation, parent of the Pathmark chain.
Similarly, SUPERVALUE acquired Richfood, Food Lion bought out Hannaford
Brothers, and Scarborough, and Albertson's purchased American Stores.
(Sean Mehegan, ``Consolidation Changes the Face of the North American
Supermarket Sector,'' Meat & Poultry (September 1999): 22-25). These
mergers and acquisitions are likely to increase market shares of the
large retailers at the cost of smaller ones.
Table 2 in the ``Baseline'' section above shows the number of
retail grocery stores in 1999. The economic impact of the first-year
costs of compliance on the processors and the retailers is determined
by dividing the total first-year costs by the number of processors or
retailers. Table 8 revealed the range of first-year costs to processors
for labeling ground or chopped products at $10.3 million to 20.3
million. These
[[Page 4995]]
costs include the fixed costs, operating costs, and the paperwork
burden costs. Since the number of processors is 2,489 (see Table 1),
the impact per processor would range from $4,138.21 ($10.3 million/
2,489) to $8,155.89 ($20.3 million/2,489). Similarly, Table 8 also
shows that the first-year costs to retailers for labeling ground or
chopped products range from $ 49.90 million($28.8 + $12.6 million +
$8.5 million) to $ 64.3 million ($43.2 million + $12.6 million +$8.5
million). In addition, as explained above, the total paperwork burden
costs to retailers for providing point-of-purchase materials for the
major cuts of single-ingredient, raw products is approximately $0.7
million. Thus, the total costs to retailers would range from $50.6
million to $65 million. Since the number of retail stores (see Table 2)
in 1999 was 69,500 (excluding convenience stores that do not normally
sell meat products), the impact per retail store would range from
$728.06 ($50.6 million/69,500) to $935.25 ($65 million/69,500).
Therefore, the impact of the first-year cost would be greater on the
processors relative to retailers.
Executive Order 12988
This proposed rule has been reviewed under Executive Order 12988,
Civil Justice Reform. States and local jurisdictions are preempted by
the Federal Meat Inspection Act (FMIA) and the Poultry Products
Inspection Act (PPIA) from imposing any marking, labeling, packaging,
or ingredient requirements on federally inspected meat and poultry
products that are in addition to, or different than, those imposed
under the FMIA or the PPIA. However, States and local jurisdictions may
exercise concurrent jurisdiction over meat and poultry products that
are outside official establishments for the purpose of preventing the
distribution of meat and poultry products that are misbranded or
adulterated under the FMIA or PPIA, or, in the case of imported
articles, which are not at such an establishment, after their entry
into the United States.
The proposed rule is not intended to have retroactive effect.
If this proposed rule is adopted, administrative proceedings will
not be required before parties may file suit in court challenging this
rule. However, the administrative procedures specified in Secs. 306.5
and 381.35 must be exhausted before there is any judicial challenge of
the application of the proposed rule, if the challenge involves any
decision of an FSIS employee relating to inspection services provided
under FMIA and PPIA.
Public Notification and Request for Data
FSIS requests information regarding the impact of this proposed
rule on minorities, women, and persons with disabilities, including
information on the number of minority-owned meat and poultry
establishments, the makeup of establishment workforces, and the
communities served by official establishments.
Public involvement in all segments of rulemaking and policy
development are important. Consequently, in an effort to better ensure
that minorities, women, and persons with disabilities are aware of this
proposed rule and are informed about the mechanism for providing their
comments, FSIS will announce it and provide copies of this Federal
Register publication in the FSIS Constituent Update. FSIS provides a
weekly FSIS Constituent Update, which is communicated via fax to over
300 organizations and individuals. In addition, the update is available
on line through the FSIS web page located at http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.fsis.usda.gov.
The update is used to provide information regarding FSIS policies,
procedures, regulations, Federal Register notices, FSIS public
meetings, recalls, and any other types of information that could affect
or would be of interest to our constituents/stakeholders. The
constituent fax list consists of industry, trade, and farm groups,
consumer interest groups, allied health professionals, scientific
professionals, and other individuals that have requested to be
included. Through these various channels, FSIS is able to provide
information to a much broader, more diverse audience. For more
information and to be added to the constituent fax list, fax your
request to the Congressional and Public Affairs Office, at (202) 720-
5704.
Paperwork Requirements
Title: Nutrition labeling of ground or chopped meat and poultry
products and single-ingredient products.
Type of Collection: New.
Abstract: FSIS has reviewed the paperwork and record keeping
requirements in this proposed rule in accordance with the Paperwork
Reduction Act. Under this proposed rule, FSIS is requiring several
information collection and recordkeeping activities. FSIS is proposing
to require nutrition labeling on the major cuts of single-ingredient,
raw meat and poultry products, either on their label or at their point-
of-purchase, unless an exemption applies. If the manufacturer provides
nutrition information on the label of individual packages of the major
cuts of single-ingredient, raw meat or poultry products, the retailer
would not be required to provide the information at the point-of-
purchase. However, if the manufacturer does not provide the nutrition
information on the label of these products, the retailer would be
required to provide the information at their point-of-purchase. In the
estimate of burden below, FSIS is estimating that all retailers would
display point-of-purchase information for the major cuts of single-
ingredient, raw meat and poultry products, because this is an
inexpensive means of providing nutrition information for multiple
products and because this rule will not require that manufacturers
include nutrition labels on the major cuts of single-ingredient, raw
meat and poultry products. FSIS is also proposing to require nutrition
labels on all ground or chopped meat and poultry products, with or
without added seasonings, unless an exemption applies.
Estimate of burden: FSIS estimates that obtaining point-of-purchase
materials and making them available for consumers would take an average
of 30 minutes. FSIS believes that the nutrition information on most
point-of-purchase materials will be based on the most current
representative database values contained in USDA's National Nutrient
Data Bank or the USDA Nutrient Database for Standard Reference. FSIS
also believes it is unlikely that there will be any nutrition claims
made on the point-of-purchase materials on the basis of the
representative data base values. Therefore, these products will not be
subject to FSIS compliance review, and there will be no recordkeeping
requirements based on this information.
FSIS estimates that developing nutrition labels for ground or
chopped products would take an average of 120 minutes. Labels developed
at official establishments would be submitted to FSIS. FSIS estimates
that each official establishment that produces ground or chopped
product would submit three labels to FSIS for approval. FSIS estimates
that it would take an average of 15 minutes to prepare and submit the
form for prior approval. All ground or chopped product would be subject
to FSIS compliance review; therefore, producers of ground or chopped
product would be required to maintain records to support the validity
of nutrient declarations contained on product labels. FSIS estimates
the average time for recordkeeping would be 5 minutes.
Respondents: Meat and poultry establishments and retail stores.
[[Page 4996]]
Estimated number of respondents: 71,989.
Estimated number of responses per respondent: 3.
Estimated total annual burden on respondents: 474,549.
Copies of this information collection assessment can be obtained
from Lee Puricelli, Paperwork Specialist, Food Safety and Inspection
Service, USDA, 112 Annex, 300 12th St., Washington, DC 20250.
Comments are invited on: (a) Whether the proposed collection of
information is necessary for the proper performance of the functions of
the Agency, including whether the information will have practical
utility; (b) the accuracy of the Agency's estimate of the burden of the
proposed collection of information including the validity of the
methodology and assumptions used; (c) ways to enhance the quality,
utility, and clarity of the information to be collected; and (d) ways
to minimize the burden of the collection of information on those who
are to respond, including through the use of appropriate automated,
electronic, mechanical, or other technological collection techniques or
other forms of information technology.
Comments may be sent to Lee Puricelli, see address above, and the
Desk Officer for Agriculture, Office of Information and Regulatory
Affairs, Office of Management and Budget, Washington, DC 20253.
Comments are requested by February 20, 2001. To be most effective,
comments should be sent to OMB within 30 days of the publication date.
References
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selectedcancers.html
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Contribution to the United States Beef Supply. May 1996.
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1999.
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Information Through Advertising and Labels,'' Food Review, May-
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D.C. Lestina, and M.A. Cohen. ``The Consumer Product Safety
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for the U.S. Consumer Product Safety Commission, July 1, 1997.
Neuhouser, M.L, A.R. Kristal, and R.E. Patterson. ``Use of Food
Nutrition Labels is Associated with Lower Fat Intake,'' Journal of
the American Dietetic Association, Vol. 99, No. 45, 1999, 45-53.
Viscusi, W.K. 1992. Fatal Tradeoffs--Public & Private
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smoking. In James M. Poterba (ed.), Tax Policy and the Economy.
Volume 9. MIT Press for the National Bureau of Economic Research.
Cambridge.
Zarkin, Gary A., Nancy Dean, Josephine Mauskopf, and Richard
Williams, ``Potential Health Benefits of Nutrition Label Changes,''
American Journal of Public Health, 83(5) May 1993: 717-724.
Zarkin, Gary, Nancy Dean, Josephine A. Mauskopf, and Dierdre M.
Neighbors, ``Estimated Benefits of Nutrition Label Changes: Final
Report, Volume 1.'' Center for Economics Research, Research Triangle
Institute, Research Triangle Park, NC 27709. April 1991.
List of Subjects
9 CFR Part 317
Food labeling, Food packaging, Meat Inspection, Nutrition,
Reporting and recordkeeping requirements.
9 CFR Part 381
Food labeling, Food packaging, Nutrition, Poultry and poultry
products, Reporting and recordkeeping requirements.
For the reasons discussed in the preamble, FSIS is proposing to
amend 9 CFR Chapter III, as follows:
PART 317--LABELING, MARKING DEVICES AND CONTAINERS
1. The authority citation for part 317 would continue to read as
follows:
Authority: 21 U.S.C 601-695; 7 CFR 2.18, 2.53.
2. Section 317.300 would be revised to read as follows:
Sec. 317.300 Nutrition labeling of meat and meat food products.
(a) Unless the product is exempted under Sec. 317.400, nutrition
labeling must be provided for all meat and meat food products intended
for human consumption and offered for sale, except single-ingredient,
raw products that are not ground or chopped products described in
Sec. 317.301 and are not major cuts of single-ingredient, raw meat
products identified in Sec. 317.344. Nutrition labeling must be
provided for the major cuts of single-ingredient, raw meat products
identified in Sec. 317.344, either in accordance with the provisions of
Sec. 317.309 for nutrition labels, or in accordance with the provisions
of Sec. 317.345 for point-of-purchase materials, except as exempted
under Sec. 317.400. For all other products for which nutrition labeling
is required, including ground or chopped meat products described in
Sec. 317.301, nutrition labeling must be provided in accordance with
the provisions of Sec. 317.309, except as exempted under Sec. 317.400.
(b) Nutrition labeling may be provided for single-ingredient, raw
meat products that are not ground or chopped meat products described in
Sec. 317.301 and that are not major cuts of single-ingredient, raw meat
products identified in Sec. 317.344, either in accordance with the
provisions of Sec. 317.309 for nutrition labels, or in accordance with
the provisions of Sec. 317.345 for point-of-purchase materials.
[[Page 4997]]
3. A new Sec. 317.301 would be added to read as follows:
Sec. 317.301 Required nutrition labeling of ground or chopped meat
products.
(a) Nutrition labels must be provided for all ground or chopped
products (livestock species) and hamburger with or without added
seasonings (including, but not limited to, ground beef, ground beef
patties, ground sirloin, ground pork, and ground lamb) that are
intended for human consumption and offered for sale, in accordance with
the provisions of Sec. 317.309, except as exempted under Sec. 317.400.
4. Section 317.309 would be amended as follows:
a. In paragraph (b)(3), the first sentence would be amended by
adding ``that are not ground or chopped meat products described in
Sec. 317.301'' after the phrase ``single-ingredient, raw products'',
and by removing ``as set forth in Sec. 317.345(a)(1)''; the second
sentence would be revised by adding, ``that are not ground or chopped
meat products described in Sec. 317.301'' after the phrase ``single-
ingredient, raw products'', and the following new sentence would be
added after the first sentence:
* * * * *
(b) * * *
(3) * * * ``For single-ingredient, raw products that are not ground
or chopped meat products described in Sec. 317.301, if data are based
on the product ``as consumed,'' the data must be presented in
accordance with Sec. 317.345(d). * * *
* * * * *
b. Paragraph (b)(10) would be amended by adding the following new
sentence at the end of the paragraph:
* * * * *
(b) * * *
(10) * * * The declaration of the number of servings per container
need not be included in nutrition labeling of single-ingredient, raw
meat products that are not ground or chopped meat products described in
Sec. 317.301, including those that have been previously frozen.
* * * * *
c. Paragraph (b)(11) would be amended by adding the phrase
``single-ingredient, raw products that are not ground or chopped meat
products described in Sec. 317.301 and'' after ``exception of''.
d. Paragraph (d)(3)(ii) would be amended by removing the period and
adding ``or on single-ingredient, raw meat products that are not ground
or chopped meat products described in Sec. 317.301.'' at the end of the
paragraph.
e. Paragraph (e)(3) would be amended by adding ``, but may be on
the basis of ``as consumed'' for single-ingredient, raw meat products
that are not ground or chopped meat products described in
Sec. 317.301,'' after ``as packaged''.
f. Paragraph (h)(9) would be amended by removing the phrase
``(including ground beef)'' products'', by adding, ``that are not
ground or chopped meat products described in Sec. 317.301'' after
``products'', by removing the phrase, ``its published form, the
Agriculture Handbook No. 8 series available from the Government
Printing Office'', and by adding, in its place, ``its released form,
the USDA Nutrient Database for Standard Reference'', and by removing
the period and adding the following at the end of the paragraph: `` as
provided in Sec. 317.345(e) and (f).''
5. Section 317.343 would be removed.
6. Section 317.344 would be amended by removing the phrases
``ground beef regular without added seasonings, ground beef about 17%
fat,'' and ``ground pork.''
7. Section 317.345 would be amended as follows:
a. Paragraph (d) would be amended by removing ``should'' and
adding, in its place, ``for products covered in paragraphs (a)(1) and
(a)(2) must''.
b. Paragraph (e) would be amended by removing ``its published form,
the Agriculture Handbook No. 8 series'' and by adding, in its place,
``its released form, the USDA Nutrient Database for Standard
Reference'', and by removing ``(including ground beef)''.
c. Paragraph (f) would be amended by adding ``provided'' after
``nutrition information is''.
d. Paragraph (g) would be amended by removing the phrase
``(including ground beef)''.
e. The section heading and paragraphs (a) and (c) would be revised
to read as follows:
Sec. 317.345 Nutrition labeling of single-ingredient, raw meat
products that are not ground or chopped products described in
Sec. 317.301.
(a)(1) Nutrition information on the major cuts of single-
ingredient, raw meat products identified in Sec. 317.344, including
those that have been previously frozen, is required, either on their
label or at their point-of-purchase, unless exempted under
Sec. 317.400. If nutrition information is presented on the label, it
must be provided in accordance with Sec. 317.309. If nutrition
information is presented at the point-of-purchase, it must be provided
in accordance with the provisions of this section.
(2) Nutrition information on single-ingredient, raw meat products
that are not ground or chopped meat products described in Sec. 317.301
and are not major cuts of single-ingredient, raw meat products
identified in Sec. 317.344, including those that have been previously
frozen, may be provided at their point-of-purchase in accordance with
the provisions of this section or on their label, in accordance with
the provisions of Sec. 317.309.
(3) A retailer may provide nutrition information at the point-of-
purchase, by various methods, such as by posting a sign, or by making
the information readily available in brochures, notebooks, or leaflet
form in close proximity to the food. The nutrition labeling information
may also be supplemented by a video, live demonstration, or other
media. If a nutrition claim is made on point-of-purchase materials, all
of the format and content requirements of Sec. 317.309 apply. However,
if only nutrition information--and not a nutrition claim--is supplied
on point-of-purchase materials, the requirements of Sec. 317.309 apply,
provided, however:
(i) The listing of percent of Daily Value for the nutrients (except
vitamins and minerals specified in Sec. 317.309 (c)(8)) and footnote
required by Sec. 317.309(d)(9) may be omitted; and
(ii) The point-of-purchase materials are not subject to any of the
format requirements.
* * * * *
(c) For the point-of-purchase materials, the declaration of
nutrition information may be presented in a simplified format as
specified in Sec. 317.309(f).
* * * * *
8. Section 317.362 would be amended by adding a new paragraph (f)
to read as follows:
Sec. 317.362 Nutrient content claims for fat, fatty acids, and
cholesterol content.
* * * * *
(f) A statement of the lean percentage may be used on the label or
in labeling of ground or chopped meat products described in
Sec. 317.301 when the product does not meet the criteria for ``low
fat,'' defined in Sec. 317.362(b)(2), provided that a statement of the
fat percentage is contiguous to and in lettering of the same color,
size, type, and on the same color background as the statement of the
lean percentage.
* * * * *
9. Section 317.400 would be amended as follows:
a. Paragraph (a)(1), introductory text, would be amended by
removing the comma and adding, at the end of the paragraph, ``, except
that this exemption does not apply to the major cuts of
[[Page 4998]]
single-ingredient, raw products identified in Sec. 317.344,''.
b. Paragraph (a)(1)(ii) would be amended by adding ``, including a
single retail store,'' after the phrase ``single-plant facility,'' and
by adding, ``, including a multi-retail store operation,'' after
``company/firm''.
c. Paragraph (a)(7)(i) would be amended by removing the semi-colon
and by adding the following at the end of the paragraph: ``, provided,
however, that this exemption does not apply to ready-to-eat ground or
chopped meat products described in Sec. 317.301 that are packaged or
portioned at a retail establishment, unless the establishment qualifies
for an exemption under paragraph (a)(1) of this section;''.
d. Paragraph (a)(7)(ii) would be amended by removing the period and
by adding the following at the end of the paragraph: ``, provided,
however, that this exemption does not apply to multi-ingredient ground
or chopped meat products described in Sec. 317.301 that are processed
at a retail establishment, unless the establishment qualifies for an
exemption under paragraph (a)(1) of this section.''
e. Paragraph (d)(1) would be amended by removing the period at the
end of the first sentence, and by adding the following to the end of
the first sentence: ``, except that this exemption does not apply to
the major cuts of single-ingredient, raw meat products identified in
Sec. 317.344.''
PART 381---POULTRY PRODUCTS INSPECTION REGULATIONS
10. The authority citation for part 381 continues to read as
follows:
Authority: 7 U.S.C. 138f, 450; 21 U.S.C. 451-470; 7 CFR 2.18,
2.53.
11. Section 381.400 would be revised to read as follows:
Sec. 381.400 Nutrition labeling of poultry products.
(a) Unless the product is exempted under Sec. 381.500, nutrition
labeling must be provided for all poultry products intended for human
consumption and offered for sale, except single-ingredient, raw
products that are not ground or chopped products described in
Sec. 381.401 and are not major cuts of single-ingredient, raw poultry
products identified in Sec. 381.444. Nutrition labeling must be
provided for the major cuts of single-ingredient, raw poultry products
identified in Sec. 381.444, either in accordance with the provisions of
Sec. 381.409 for nutrition labels, or in accordance with the provisions
of Sec. 381.445 for point-of-purchase materials, except as exempted
under Sec. 381.500. For all other products that require nutrition
labeling, including ground or chopped poultry products described in
Sec. 381.401, nutrition labeling must be provided in accordance with
the provisions of Sec. 381.409, except as exempted under Sec. 381.500.
(b) Nutrition labeling may be provided for single-ingredient, raw
poultry products that are not ground or chopped poultry products
described in Sec. 381.401 and that are not major cuts of single-
ingredient, raw poultry products identified in Sec. 381.444, either in
accordance with the provisions of Sec. 381.409 for nutrition labels, or
in accordance with the provisions of Sec. 381.445 for point-of-purchase
materials.
* * * * *
12. A new Sec. 381.401 would be added to read as follows:
Sec. 381.401 Required nutrition labeling of ground or chopped poultry
products.
Nutrition labels must be provided for all ground or chopped poultry
(kind) with or without added seasonings (including, but not limited to,
ground chicken, ground turkey, and (kind) burgers) that are intended
for human consumption and offered for sale, in accordance with the
provisions of Sec. 381.409, except as exempted under Sec. 381.500.
* * * * *
13. Section 381.409 would be amended as follows:
a. In paragraph (b)(3), the first sentence would be amended by
adding ``that are not ground or chopped poultry products described in
Sec. 381.401'' after the phrase ``single-ingredient, raw products'' and
by removing ``as set forth in Sec. 381.445(a)(1)''; the second sentence
would be amended by adding, ``that are not ground or chopped poultry
products described in Sec. 381.401,'' after the phrase ``single-
ingredient, raw products''; and the following new sentence would be
added after the first sentence:
* * * * *
(b) * * *
(3) * * * For single-ingredient, raw products that are not ground
or chopped poultry products described in Sec. 381.401, if data are
based on the product ``as consumed,'' the data must be presented in
accordance with Sec. 381.445(d).* * *
b. Paragraph (b)(10) would be amended by adding the following new
sentence at the end of the paragraph:
* * * * *
(b) * * *
(10) * * * The declaration of the number of servings per container
need not be included in nutrition labeling of single-ingredient, raw
poultry products that are not ground or chopped poultry products
described in Sec. 381.401, including those that have been previously
frozen.
* * * * *
c. Paragraph (b)(11) would be amended by adding the phrase
``single-ingredient, raw products that are not ground or chopped
poultry products described in Sec. 381.401 and'' after ``exception
of''.
d. Paragraph (d)(3)(ii) would be amended by removing the period and
adding ``or on single-ingredient, raw poultry products that are not
ground or chopped poultry products described in Sec. 381.401.'' at the
end of the paragraph.
e. Paragraph (e)(3) would be amended by adding ``, but may be on
the basis of ``as consumed'' for single-ingredient, raw poultry
products that are not ground or chopped poultry products described in
Sec. 381.401,'' after ``as packaged''.
f. Paragraph (h)(9) would be amended by adding, ``that are not
ground or chopped poultry products described in Sec. 381.401'' after
``products'', by removing the phrase, ``its published form, the
Agriculture Handbook No. 8 series'', and by adding, in its place, ``its
released form, the USDA Nutrient Database for Standard Reference'', and
by removing the period and adding the following at the end of the
paragraph:
``, as provided in Sec. 381.445(e) and (f).''
14. Section 381.443 would be removed.
15. Section 381.445 would be amended as follows:
a. Paragraph (d) would be amended by removing ``should'' and
adding, in its place, ``for products covered in paragraphs (a)(1) and
(a)(2) of this section must''.
b. Paragraph (e) would be amended by removing ``its published form,
the Agriculture Handbook No. 8 series'' and by adding, in its place,
``its released form, the USDA Nutrient Database for Standard
Reference.''
c. Paragraph (f) would be amended by adding ``provided'' after
``nutrition information is''.
d. The section heading and paragraph, (a) and (c) would be revised
to read as follows:
Sec. 381.445 Nutrition labeling of single-ingredient, raw poultry
products that are not ground or chopped products described in
Sec. 381.401.
(a)(1) Nutrition information on the major cuts of single-
ingredient, raw poultry products identified in Sec. 381.444, including
those that have been previously frozen, is required, either on their
label or at their point-of-purchase, unless exempted under
Sec. 381.500. If
[[Page 4999]]
nutrition information is presented on the label, it must be provided in
accordance with the provisions of Sec. 381.409. If nutrition
information is presented at the point-of-purchase, it must be provided
in accordance with the provisions of this section.
(2) Nutrition information on single-ingredient, raw poultry
products that are not ground or chopped poultry products described in
Sec. 381.401 and are not major cuts of single-ingredient, raw poultry
products identified in Sec. 381.444, including those that have been
previously frozen, may be provided at their point-of-purchase in
accordance with the provisions of this section or on their label, in
accordance with the provisions of Sec. 381.409.
(3) A retailer may provide nutrition information at the point-of-
purchase, by various methods, such as by posting a sign, or by making
the information readily available in brochures, notebooks, or leaflet
form in close proximity to the food. The nutrition labeling information
may also be supplemented by a video, live demonstration, or other
media. If a nutrition claim is made on point-of-purchase materials, all
of the format and content requirements of Sec. 381.409 apply. However,
if only nutrition information--and not a nutrition claim--is supplied
on point-of-purchase materials, the requirements of Sec. 381.409 apply,
provided, however:
(i) The listing of percent of Daily Value for the nutrients (except
vitamins and minerals specified in Sec. 381.409(c)(8)) and footnote
required by Sec. 381.409(d)(9) may be omitted; and
(ii) The point-of-purchase materials are not subject to any of the
format requirements.
* * * * *
(c) For the point-of-purchase materials, the declaration of
nutrition information may be presented in a simplified format as
specified in Sec. 381.409(f).
* * * * *
16. Section 381.462 would be amended by adding a new paragraph (f)
to read as follows:
Sec. 381.462 Nutrient content claims for fat, fatty acids, and
cholesterol content.
* * * * *
(f) A statement of the lean percentage may be used on the label or
in labeling of ground or chopped poultry products described in
Sec. 381.401 when the product does not meet the criteria for ``low
fat,'' defined in Sec. 381.462(b)(2), provided that a statement of the
fat percentage is contiguous to and in lettering of the same color,
size, type, and on the same color background as the statement of the
lean percentage.
* * * * *
17. Section 381.500 would be amended as follows:
a. Paragraph (a)(1) would be amended by removing the comma and
adding, at the end of the paragraph, ``, except that this exemption
does not apply to the major cuts of single-ingredient, raw poultry
products identified in Sec. 381.444.
b. Paragraph (a)(1)(ii) would be amended by adding, ``, including a
single retail store,'' after the phrase ``single-plant facility,'' and
by adding ``, including a multi-retail store operation'' after
``company/firm''.
c. Paragraph (a)(7)(i) would be amended by removing the semi-colon
and adding the following at the end of the paragraph: ``provided,
however, that this exemption does not apply to ready-to-eat ground or
chopped poultry products described in Sec. 381.401 that are packaged or
portioned at a retail establishment, unless the establishment qualifies
for an exemption under paragraph (a)(1) of this section,'' after
``establishment''.
d. Paragraph (a)(7)(ii) would be amended by removing the period and
adding the following at the end of the paragraph: ``provided, however,
that this exemption does not apply to multi-ingredient ground or
chopped poultry products described in Sec. 381.401 that are processed
at a retail establishment, unless the establishment qualifies for an
exemption under paragraph (a)(1) of this section.'' after
``establishment''.
e. Paragraph (d)(1) would be amended by removing the period at the
end of the sentence, and by adding the following to the end of the
sentence: ``except that this exemption does not apply to the major cuts
of single-ingredient, raw poultry products identified in
Sec. 381.444.''
Done in Washington, DC, on January 8, 2001.
Thomas J. Billy,
Administrator.
[FR Doc. 01-1119 Filed 1-17-01; 8:45 am]
BILLING CODE 3410-DM-P