Speaker 1: Bloomberg Audio Studios, Podcasts, radio News. The other day, our
Speaker 1: producer Julia Press pulled me into the studio with a
Speaker 1: sweeter than usual assignment.
Speaker 2: I have treats brought back from my tour of the
Speaker 2: Welchi's Fruit Snacks factory. I brought two types of fruit
Speaker 2: snacks for you to try. This old type that they're
Speaker 2: phasing out and the new type that they're rolling out.
Speaker 2: And there's one key difference. The old type included a
Speaker 2: little bit of artificial dyes added in for color. The
Speaker 2: new type only gets their dies from natural sources fruits
Speaker 2: and vegetables.
Speaker 1: This switch has been a long time in the making.
Speaker 1: Welch's has been on a decade long odyssey to swap
Speaker 1: out artificial flavors for natural ones. But it's now something
Speaker 1: the Trump administration wants all companies to do as part
Speaker 1: of its crusade to quote make America healthy again.
Speaker 2: Okay, dump them out. How did they look to you?
Speaker 2: So they look exactly the same, you think? Okay, let's
Speaker 2: do a side by side comparison. Let's start with raspberry.
Speaker 1: All right, old kind, a little more clear, a little
Speaker 1: more vibrant. New kind, firmer, skinnier, and a little more muted,
Speaker 1: but only slightly.
Speaker 2: They do look pretty much identical.
Speaker 1: They look pretty much identical.
Speaker 2: Okay, let's do a taste test. Close your eyes.
Speaker 1: Number one, I'm really getting taken back to middle school here.
Speaker 3: You look blissed out.
Speaker 1: It tastes so good.
Speaker 4: Okay.
Speaker 1: Number two, spoiler alert, I couldn't tell the difference. Well,
Speaker 1: I just had two delicious fruit snacks that tasted exactly
Speaker 1: the same. Really, if you had to guess, was the
Speaker 1: first one the old kind and the second one the
Speaker 1: new kind?
Speaker 4: No?
Speaker 3: Oh, the opposit.
Speaker 1: Making a near replica of this popular product was time consuming, costly,
Speaker 1: and complicated, and as other companies try to pull this off,
Speaker 1: Welch's case study could reveal a lot about the challenges
Speaker 1: that lie ahead for the American food industry. I'm Sarah Holder,
Speaker 1: and this is the big take from Bloomberg News today.
Speaker 1: On the show, as the Trump Administration's MAHA movement encourages
Speaker 1: more and more food and drink companies to rework their formulas,
Speaker 1: we visit one company that's done it to see what
Speaker 1: it takes. What's the first thing you think of when
Speaker 1: you think of Welch's fruit snacks.
Speaker 4: I think of vending machines like soccer practice, where like
Speaker 4: you're you know, deciding.
Speaker 3: You know, how you're going to spend your two dollars
Speaker 3: and fifty cents that you've scrowned up.
Speaker 1: Yes, they were in my middle school vending machine too.
Speaker 3: Yeah, yeah, and we would.
Speaker 1: Like get them during lunch and kind of like swap
Speaker 1: colors and things like that.
Speaker 3: Yeah, personally avoiding the orange one.
Speaker 1: That's Bloomberg reporter Will Kobzanski. He recently went with our
Speaker 1: producer Julia to tour A. Welch's Fruits next production plant
Speaker 1: in New Jersey because.
Speaker 4: They have begun rolling out products without any synthetic food dies.
Speaker 4: So that's you know, Red forty blue number one, and
Speaker 4: you know, they had just started making this transition on
Speaker 4: its flagship product, the mixed fruit variety.
Speaker 1: Food dyes are in the headlines a lot these days.
Speaker 4: Four years from now, we're going to have most of
Speaker 4: these products off the market, or you will know about
Speaker 4: them when.
Speaker 1: You They've been thrust into the spotlight by Trump's Secretary
Speaker 1: of Health and Human Services, Robert F. Kennedy Junior. We
Speaker 1: have them on the run now and we are going
Speaker 1: to win this battle. That battle he's talking about is
Speaker 1: the war on ultra processed foods, specifically the artificial dyes
Speaker 1: that are often in those ultra processed foods, like petroleum
Speaker 1: based red forty. So far, it's been more of a
Speaker 1: pressure campaign than an all out war. The FDA hasn't
Speaker 1: banned these dies outright, but RFK has encouraged companies to
Speaker 1: drop them by the end of next year.
Speaker 4: There's lots of other things he cares about, seed oils,
Speaker 4: He talks a lot about ultra processed foods. Synthetic dies, though,
Speaker 4: are the area where we've seen the most change, the fastest,
Speaker 4: and the most response from companies that are subject to
Speaker 4: his regulations.
Speaker 1: What does the research say, What kind of health effects
Speaker 1: do synthetic dies and artificial dies actually have on consumers?
Speaker 4: So there's no like slam dunk piece of evidence that
Speaker 4: sort of says one way or the other synthetic food
Speaker 4: dies are really good or really bad. The FDA considers
Speaker 4: them safe, and the FDA has not revoked the regulation
Speaker 4: authorizing the use of synthetic food dies. If you want to,
Speaker 4: you could still put red forty in your product right now.
Speaker 4: There's some state laws you'd have to navigate in the
Speaker 4: late two thousands, there is a UK study that showed
Speaker 4: that there's some association with hyperactivity in children from synthetic dies.
Speaker 4: In twenty ten, the EU said we're going to put
Speaker 4: a warning label on anything that has a synthetic food
Speaker 4: die in it. In twenty eleven, the USFDA did a
Speaker 4: similar review. They said, we don't see any causal effect
Speaker 4: between adverse behaviors and food dies. We don't see the
Speaker 4: need to put a warning label on Although that was
Speaker 4: like a little more closely contested. About a decade later,
Speaker 4: California reviewed the evidence and said, actually, we do think
Speaker 4: there's a link, and that evidence sort of got passed
Speaker 4: along the chain, and a couple of years later, Gavin
Speaker 4: Newsom signed a bill that prohibits the use of synthetic
Speaker 4: food dies in schools. Beginning in twenty twenty eight.
Speaker 1: About a fifth of products on American grocery store shelves
Speaker 1: contain synthetic food dies in twenty twenty. That's according to
Speaker 1: a study published by the Academy of Nutrition and Dietetics
Speaker 1: this year.
Speaker 4: That number's probably gone down since twenty twenty because companies
Speaker 4: have like sort of started to since where the wind
Speaker 4: is blowing and they've been trying to get rid of
Speaker 4: them in their new products. But where they found them
Speaker 4: most often sugary beverages, sugary treats, things often marketed at kids.
Speaker 3: You can do the math right.
Speaker 4: If something looks good, if something looks bright and exciting
Speaker 4: and colorful, you're going to be more likely to want
Speaker 4: to eat it, especially if you're like, you know, a
Speaker 4: six year old at the Walmart with your dad looking
Speaker 4: at the cereal aisle.
Speaker 1: That brings us back to Welches. Since two thousand and one,
Speaker 1: a company called pim Brands has been making these fruit
Speaker 1: snacks and licensing the Welsh name from the juice and
Speaker 1: jelly maker. Historically, the company's formula contains some artificial dyes
Speaker 1: in addition to the natural color that comes from the
Speaker 1: fruit purese inside, but in twenty fifteen it started experimenting
Speaker 1: with reducing its dependency on synthetic dies, and last month
Speaker 1: it announced they'd be fully phased out of all its
Speaker 1: fruit snack products by early twenty twenty six.
Speaker 4: We are outside the pim Brands factory in Somerset, New Jersey,
Speaker 4: where they make Welsish fruit snacks.
Speaker 5: We have nearly a million square feet dedicated to manufacturing, packaging,
Speaker 5: and distributing Welsis fruit snacks, which go across North America.
Speaker 5: Actually from this facility we also saw.
Speaker 1: That's Michael Rosenberg, Pinbrands CEO who showed Will and Julia around.
Speaker 4: It felt closer to like the Model T production line
Speaker 4: than it did Willy Wonka. It's one of these office
Speaker 4: parks that's sort of like you wouldn't know it exists
Speaker 4: unless you had a reason to go to it. And
Speaker 4: you walk into this factory, it just sort of smells
Speaker 4: like warm fruit. It smells like a.
Speaker 3: Fruit snack in here.
Speaker 4: Isn't like a like a pie, like a fruit pie.
Speaker 4: Like I'm trying to figure out what this reminds me of.
Speaker 5: Well, so, because of the number of fruits in our product,
Speaker 5: you don't smell any particular fruit. You just get this
Speaker 5: incredibly fruit smelling aroma.
Speaker 4: Just like a remarkable amount of movement in the factory.
Speaker 4: I found. The fruit snacks themselves are going into the molds,
Speaker 4: they're being shaken out, they're being transported across the factory
Speaker 4: and like a conveyor belt set up. You know, massive
Speaker 4: facility people you know, wearing their safety equipment, fruit snacks
Speaker 4: going on all kinds of conveyor else enough little fruit
Speaker 4: snack elevators and machines doling out packages and pouches. How much,
Speaker 4: generally speaking does it cost to build a facility like this?
Speaker 5: Each production line costs between fifteen and twenty million dollars.
Speaker 5: We have six production lines, and then of course you
Speaker 5: have all the packaging part. So there's a fortune in
Speaker 5: this building.
Speaker 1: The factory can turn out over ten billion pouches of
Speaker 1: fruit snacks a year. Will and Julia sat down with
Speaker 1: the team responsible for Welch's fruit snacks pivot to natural
Speaker 1: dies and they told them it's been a long road.
Speaker 4: So this process, according to them, started in twenty fifteen,
Speaker 4: so a decade ago. They're chief officer of R and D.
Speaker 4: She won noticed the products are made with real fruit.
Speaker 4: So you know, part of the Welchi's fruit snacks, like
Speaker 4: the stick is you know, a strawberry fruit snack is
Speaker 4: made with real strawberry pure So there's already a little
Speaker 4: color from those fruits in there.
Speaker 6: It inheritently comes with some natural color. And we were
Speaker 6: adding so many school amounts, so I was thinking, if
Speaker 6: he can introduce that, why not.
Speaker 1: Bavna Romani that R and D director also noticed that
Speaker 1: synthetic dyes were starting to lose favor internationally, so Bavna
Speaker 1: and her team started tinkering. They took it one color
Speaker 1: at a time. First up yellow, the low hanging fruit,
Speaker 1: so to speak. She said, yellow was easier to swap
Speaker 1: out because there are lots of natural sources of the
Speaker 1: color and enough supply of those substitutes in the market.
Speaker 4: They're replaced some with turmeric and anato, and it was
Speaker 4: a relatively easy switch. Kraft mac and Cheese made a
Speaker 4: very similar switch around that time.
Speaker 1: Nato is a yellow coloring made from a tree seed,
Speaker 1: but other colors were harder to match. Here's Bavna.
Speaker 6: Unfortunately, there was no true replacement for the blue because
Speaker 6: there are not too many blue fruits for vegetable, because
Speaker 6: all natural colors are derived from real fruits and vegetable
Speaker 6: and in reality, if you go to the supermarket, it's
Speaker 6: not too many choices.
Speaker 1: Don't replace that.
Speaker 4: It's not just can we match the exact shade, it's
Speaker 4: can the shade last over time? Is the pH imbalance
Speaker 4: between the dye and the fruit period that's already in there.
Speaker 4: Is that going to make the fruit snack turned brown
Speaker 4: over time.
Speaker 1: For the blue color, they settled on spirillina, a type
Speaker 1: of algae, and a fruit called tueto found in South
Speaker 1: and Central America. Getting a new raspberry gummy to look
Speaker 1: and taste just like the old gummy so that unsuspecting
Speaker 1: eaters like me can't tell the difference took the R
Speaker 1: and D team close to fifty different trials to replace
Speaker 1: red forty. They used ingredients like purple carrot and red grape,
Speaker 1: and once they figured out the right combination of ingredients,
Speaker 1: they had to find a way to make the colors consistent.
Speaker 6: Fruit grow in North America versus South America, it has
Speaker 6: a different taste, different color.
Speaker 4: They needed to find the suppliers natural eyes work with
Speaker 4: the suppliers to make sure that when the food die
Speaker 4: is transported, like it's not getting any adverse impacts from
Speaker 4: temperature changes in the supply chain. They needed to work
Speaker 4: with them to stabilize the acidity of the food dies
Speaker 4: because it was interacting with the fruit that was in
Speaker 4: their fruit snacks, and like, you need to make sure
Speaker 4: it doesn't just turn round in like three months, six months,
Speaker 4: nine months, a year over the course of the full
Speaker 4: shelf life.
Speaker 3: Of the product.
Speaker 4: You have to do R and D, you have to
Speaker 4: find the right people, you need to do the testing.
Speaker 4: Things that cost money, and.
Speaker 1: It comes with risk, not just financial risk, but the
Speaker 1: risk of alienating customers. We get into that and how
Speaker 1: other companies are trying to make similar changes after the break.
Speaker 1: When it comes to swapping out synthetic dyes with natural dyes,
Speaker 1: wel Jess Fruit Snacks was a little earlier to the party,
Speaker 1: but now many other companies are starting to follow suit.
Speaker 1: PepsiCo is the latest company to jump on the Maha bandwagon,
Speaker 1: announcing plans to remove artificial colors and flavors. Craft is
Speaker 1: announcing they will no longer be launching any products that
Speaker 1: have artificial die in the general mills, announcing it will
Speaker 1: remove artificial colors from its US cereals n K through
Speaker 1: twelfth school Foods by next summer.
Speaker 3: A lot of what we've seen so far are commitments
Speaker 3: to do it.
Speaker 1: Let's talk about some of those commitments. How quickly are
Speaker 1: these companies saying that they'll do this.
Speaker 4: So the timeline that most companies have given is by
Speaker 4: the end of twenty twenty seven beginning of twenty twenty eight.
Speaker 4: That's a specific date because beginning on January first, twenty
Speaker 4: twenty eight, if you want to sell your product in
Speaker 4: West Virginia, you can't have synthetic dies in it. There
Speaker 4: are similar laws going into affecting the California schools Texas.
Speaker 4: The feasibility is another question.
Speaker 1: Remember, for Welch's the changeover took a decade. It took
Speaker 1: a full year just to test that the new colors
Speaker 1: wouldn't fade over the course of the product's shelf life.
Speaker 1: But does that mean it will take a decade for
Speaker 1: everyone else to do it too. Maybe not Welches.
Speaker 4: They have a more complex product than like a Scale
Speaker 4: or a Starburst. There's the fruit in there, vitamins and
Speaker 4: minerals and things like that. And also, you know, compared
Speaker 4: to Mars or Hershey or Mandalize or a smaller company. Right,
Speaker 4: no one is explicitly said as much to me, but
Speaker 4: like they don't have the same leverage that you know,
Speaker 4: a massive multinational might have to secure these food dies.
Speaker 4: On the other hand, they've been working on this for
Speaker 4: ten years, they've been thinking about it for a long time.
Speaker 3: The question is matching the shades.
Speaker 4: Customers, you know, when they open a box of Welch's
Speaker 4: fruit snacks or a box of M and ms or
Speaker 4: you know, their cereal. They want to recognize the product
Speaker 4: that they know.
Speaker 1: There's a lot at stake when you start tinkering with
Speaker 1: a classic recipe. General Mills learn that the hard way
Speaker 1: when it tried this with Trick Cereal back in twenty sixteen, and.
Speaker 3: Then the American consumer was appalled.
Speaker 4: The tricks did not look like the tricks that they
Speaker 4: had grown to love, and they very quickly made the switchback.
Speaker 1: Ten years later, the American consumer might be more comfortable
Speaker 1: with this kind of change, and if they aren't already,
Speaker 1: they could just get used to it.
Speaker 4: I talked with someone who runs one of these natural
Speaker 4: eye companies, and something funny he said was Europeans when
Speaker 4: they see that like bright synthetic red forty shade, they're like,
Speaker 4: oh my god, there must be like something wrong with it.
Speaker 4: It looks like it was made in a chemical plant.
Speaker 1: There are other reasons a larger corporation could have an
Speaker 1: easier time than PIM did. Those companies may operate in
Speaker 1: countries where they're already asked to put warning labels on
Speaker 1: duyed products, or were they're not allowed to use synthetic dyes,
Speaker 1: so they may have a head start on the replacement process.
Speaker 1: How much of the motivation of these companies to rework
Speaker 1: these formulas is part of kind of making the current
Speaker 1: administration happy versus these broader globe forces.
Speaker 4: It's a good question putting aside RFK, MAHA and sort
Speaker 4: of the cultural lane it tapped into, Like there are
Speaker 4: people who are interested in this, there are people who
Speaker 4: don't want their kids to consume synthetic dies. What I
Speaker 4: would say is that RFK is making a lot of
Speaker 4: other asks right. There are seed oils, which are you know,
Speaker 4: canola sun flower seed oil, things like that. He wants
Speaker 4: those removed from the food supply. He would like things
Speaker 4: to the effect of limits on how much sugar we
Speaker 4: consume and the ultra process foods we consume. I can't
Speaker 4: read the mind of these CEOs and the folks who
Speaker 4: are doing their public affairs. But objectively changing one or
Speaker 4: two ingredients where there's an existing replacement and in fact
Speaker 4: it's already used internationally feels like a lighter lift than
Speaker 4: making these more fundamental changes to how you fry your product,
Speaker 4: how you consider your product process or ultra process, to
Speaker 4: the amount of sugar in there right.
Speaker 1: Well, that brings us to sort of a broader final question,
Speaker 1: which is that the stated goal of these changes per
Speaker 1: R is to make Americans healthier. Is there a significant
Speaker 1: health benefit here or are these mostly aesthetic changes that
Speaker 1: are easier to achieve.
Speaker 3: It's a question I don't have a complete answer.
Speaker 4: Yeah too, Yeah, there's some discourse on this because RFKS
Speaker 4: took something of a victory lap when Kellogg's cut its.
Speaker 3: Synthetic food dies.
Speaker 4: Anytime a company cuts its synthetic food dies, he'll put
Speaker 4: out a tweet and he'll say it's a MAHA win.
Speaker 3: And the Kellogg's wone got picked up and.
Speaker 4: It kind of sparked this broader conversation about you know,
Speaker 4: if you're eating the French fries but they're made with
Speaker 4: beef tallow instead of being friend to seed oil, and
Speaker 4: you're having the fruit loop still and they're still full
Speaker 4: of sugar, but like they don't have the red forty
Speaker 4: in them, the question sort of becomes like how much
Speaker 4: of an impact is this happening versus like how much
Speaker 4: does this just sort of Maha being able to take
Speaker 4: the win. The administration would contend that this is the
Speaker 4: first change of many to come. They want to fundamentally
Speaker 4: change the way we eat in this country. They're going
Speaker 4: to try and make some pretty big changes to the
Speaker 4: dietary guidelines that are coming out later this summer. Where
Speaker 4: the alternative take is the companies saw an easy place
Speaker 4: to score some points, and we'll see what happens with
Speaker 4: the rest of the changes.
Speaker 1: This is The Big Take from Bloomberg News. I'm Sarah Holder.
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