A new report from USDA's Economic Research Service says most consumers mistakenly assign health and environmental stewardship attributes to food labeled “natural,” putting food producers who use organic or antibiotics-free labels at a competitive disadvantage.

“Consumers may not be getting the health and environmental attributes they seek and are paying for, producers supplying those attributes may be losing sales, and the health or environmental benefits of the attribute may not be realized,” the report said.

ERS said the “natural” claim can be made with relatively little cost compared to the “USDA Organic” and “raised without antibiotics” labels, which “require different and more expensive production techniques than conventional agriculture.”

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By contrast, neither USDA nor FDA has regulations defining the word, though FDA generally treats it as meaning nothing artificial was added and the product was minimally processed.

“Natural” labels are predominantly found on processed products, including 95.6% of vitamins and meal supplements, ERS said.

At 16.3% of all household retail expenditures, natural-labeled foods nearly tripled the amount of organic-labeled foods purchased in 2018, ERS said. Almost one-third of all natural-labeled foods bought were dairy items.

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