The study explores how food manufacturers respond to state regulations

When West Virginia recently banned seven artificial food dyes in products sold within its borders, they joined the increase in individual US issues their own regulations regarding food manufacturing practices, acceptable ingredients, or labeling products. As a result, food manufacturers need to decide how to address different requirements across multiple markets.

A new study from the University of Illinois Urbana-Champaign University looks at various ways manufacturers can respond to state regulations and what drives their choices.

“The nation has many constitutional powers to protect the health and well-being of its citizens. However, a state-level food regulation approach can lead to a complex patchwork that creates challenges for food manufacturers selling products across state lines, including consumer and environmental science in Illinois.

Kalaitzandandakes and co-author William Ridley, Kalaitzandandakes, associate professor at Ace, developed a modeling framework that outlines potential responses, and then consulted with food manufacturers to ensure a model that is in line with the actions that producers are actually taking to address policy changes.

“Food manufacturing is a key industry in Illinois and across the country,” Ridley said. “After developing the model, we asked several food manufacturers how they respond to different state laws. We were excited that the model did a good job explaining solid strategies.”

Researchers identified four optional food manufacturers selected according to state food regulations. First, manufacturers can update their products to comply with the strictest standards and sell new versions across the market. Secondly, they can maintain two separate versions of the product. One is sold to a regulated state or region, and the other is sold in other parts of the country. Third, they can remove the product completely from the tougher market and sell the original product in the remaining states. Finally, they may ignore regulations and continue to sell the original product with the potential for legal consequences.

The responses a company chooses will depend on many factors, including the cost of compliance, the size of the market in a regulated state, the costs and potential of penalties, and the consequences of consumer demand. The researchers applied the model to three different case studies and looked at manufacturer responses in each scenario.

In 2014, Vermont enforced a law requiring essential labeling of genetically modified ingredients. Most companies created one version of the product that met Vermont requirements and were sold nationwide. However, because Vermont is a small market, some producers have chosen to temporarily evict the state until they made production changes to comply with the law.

In 2019, Illinois enacted a law requiring allergen signs for products containing sesame seeds. Some companies ignored the requirements as the outcome of violations of the law was minimal.

The third case study addresses the ban on four recent food additives in California, which was enacted in 2023 and fully effective in 2027. Maintaining individual production and delivery lines is complicated and expensive.

For most companies, reorganizing their products, complying with the law, and selling new products across the country was the best course of action. However, the strategy becomes more complicated as more state regulations on food additives, including West Virginia’s recent expansion on food dyes, researchers note.

“If multiple states are legislating on similar issues but the rules are not in harmony, the complexity is likely to increase dramatically. For example, if state laws differ on covered ingredients, exemptions, and timelines, this could create additional hurdles and uncertainties for businesses seeking to comply with the rules,” Ridley said.

Sometimes state regulations ultimately lead to federal involvement. For example, Congress has passed both national mandates to label genetically modified ingredients in food, expanding allergen labeling regulations to include sesame. This is a predictable outcome as the federal government is tasked with easing interstate commerce.

“State regulations can be a strong motivation for federal regulations. We increasingly see that advocacy for changing food regulations at the state level will change businesses’ behavior and drive change in national regulations.”