Identity Crisis Brews For Alt-Milks As Congress Pushes FDA Scrutiny

fdamilk970The growth of the dairy-free milk alternative business has been well-documented in recent years, with products derived from almond, soy, pea, hemp and more creating an ever-expanding set of choices for consumers when it comes to figuring out what to put in their coffee or cereal.

But maybe it’s grown too fast: as the last year ended, a group of 32 U.S. congressmen threw those drinks a holiday-season curveball in the form of a letter that argued so-called “alt-milks” aren’t “milk” at all, and pressured the U.S. Food and Drug Administration (FDA) to take action to reserve that descriptor for dairy products only.

If the FDA heeds their call, it’s a move that could mean big changes for one of the hottest areas of the beverage industry, and it’s unclear how consumers might respond — but the potential for change is there regardless.

“I think it’s downstream as an issue,” said Billie Thein, founder of almond milk producer New Barn. “Because [the usage of ‘milk’] has gone on for so long, because there is no consumer confusion, and because there may be a solution that adds a qualifier statement rather than upsetting the entire category a la carte, I don’t think it’s in the interest of any of the stakeholders.”

But the dairy industry is one of those stakeholders, and dairy state congressmen, led by Rep. Peter Welch, D-VT, and Rep. Mike Simpson, R-ID, formed a bipartisan group to co-sign a letter to the FDA on Dec. 16, calling for the government agency to crack down on the use of the word “milk” on the labels of what they called “imitation ‘milk’ products” such as almond, soy and other dairy alternative beverages. The letter urged the FDA to enforce a longstanding regulation that legally defines milk as the lactated liquid from cows. That rule, they said, has been subject to lax enforcement over the years: many brands and products regularly include descriptors such as “soy milk” and other similar phrasing on their packaging.

“While consumers are entitled to choose imitation products, it is misleading and illegal for manufacturers of these items to profit from the ‘milk’ name,” the letter said. “We urge the FDA to enforce this matter by requiring plant-based products to adopt a more appropriate name that does not include the word ‘milk.’”

nmpf-04The National Milk Producers Federation, which runs a political action committee representing dairy producers and cooperatives, was one of the first groups to praise the letter. In both 2000 and 2010 the federation wrote similar letters to the FDA urging a crackdown on the written regulations, but the FDA took no major action against brands using the word.

According to Chris Galen, a spokesman for NMPF, the horde of non-dairy “milks” on the market has only grown since the last time a request was sent to the FDA. In 2000, he said, the main competitor to dairy was soy milk, a category that was largely dominated by WhiteWave’s Silk brand. In 2010, almond milk had risen to prominence, overtaking the category as the leading style of alt-milk. But since then, the category has blown up, and features prominent brands offering numerous nut milks alongside pea, hemp, and rice milks among others as the popularity of almond milk continues to surge. Almond milk alone brought in more than $894 million in sales in 2015.

For NMPF, the lack of a legal standard of identity for alt-milk is a big issue.

“As we see more products on the market, there’s going to be more confusion about what nutritional benefits they offer,” Galen said. “There’s a reason why these imitators not only label themselves ‘milk,’ but use dairy imagery. It’s because they want to get that halo. Imitation is the sincerest form of flattery, so you ape that halo, but you’re not getting the same amount of nutrition as dairy.”

Currently, FDA guidelines regarding alt-milk are far looser than those regulating dairy milk, which according to Galen is a point of contention with dairy farmers and producers.

Some alt-milk producers, however, are not buying the opposition’s argument. August Vega, founder and CEO of Malk, said the main point of the letter – that alt-milks are deceiving consumers – is a falsehood.

“I don’t believe at all that any of us in the alt-milk category are trying to deceive or mislead dairy drinkers into buying our products,” Vega said. “I would have to say wholeheartedly I do not agree with the statement that people are being misled at all.”

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August Vega, MALK

If the FDA were to begin a stricter enforcement of regulations, many companies could potentially be forced to rebrand without the word “milk.” In Vega’s case, her brand currently uses the word “milk” on its labels but she said Malk would simply use its brand name as a descriptor – selling “Almond Malk,” “Pecan Malk” and other flavors.

Vega said Malk’s brand name was chosen strategically to be able to adapt to tighter regulations. Other brands, however, may have a trickier path forward if the letter prompts the FDA to take action.

Some brands that use compound words, such as the singular “almondmilk,” are also in violation, according to Galen. In the U.K., labeling laws have forced alt-milk brands to already find ways around the touchy word, often including the phrase “dairy substitute” on packaging to get their message across. The Washington Post theorized that “drink” and “juice” could be potential substitutes, but without the “milk” descriptor, the plant-based category could be facing an identity crisis.

Thein said that, although many other plant-based products on the market use “milk” as a standalone, he felt that usage represents an encroachment on dairy’s standard of identity. New Barn uses the compound “almondmilk,” which he said has legal precedent as being differential, citing a 2013 dismissal of a lawsuit against WhiteWave.

Regardless, Thien said he’s sure that power and influence will continue to play a role.

Billy Thein, New Barn

Billy Thein, New Barn

“One question is, who has the lobbying wherewithal?” Thein said. “Orange juice is a classic example of lobbying wherewithal – the standards of identity there were crafted by the industry and handed to the legislators who adopted them. And they’re seeing right now, we’re seeing a very fuzzy use of the term ‘cold pressed.’ Sometimes it means HPP, sometimes it means cold pressed initially and then thermally treated.”

According to Galen, much of the concern for consumer confusion doesn’t stem from whether shoppers confuse dairy milk for non-dairy alternatives, but rather the potential misconception that they’re getting the same amount of nutrition as they would from dairy milk. Because of the variety of ways and ingredients with which dairy alternatives are made, the amounts of sugar, protein and calcium can fluctuate rapidly from brand to brand, a difference that has even been stressed by-products like Ripple, another alt-milk company.

Vega said she embraces those differences, but others in the category would like to see alt-milk receive a more consistent identity.

Cyrus Schwartz, founder of Dora’s Naturals, comes from a long family line of dairy entrepreneurs, but his New York-based dairy distribution company also entered the soy milk category more than two decades ago. At the time, he said, there was no guidance from the FDA and there was initially confusion whether using “milk” would be permissible.

“It’s still been a gray area for the last two decades but I think it’s pretty settled in consumer minds,” Schwartz said. “I don’t think there’s confusion.”

Cyrus Schwartz, Dora's Naturals

Cyrus Schwartz, Dora’s Naturals

Schwartz said he felt that the dairy industry may be pushing back against alt-milks due to a recent decline in dairy sales. But although plant-based milk sales contribute to that decline, it is only one part of a larger set of changes to consumer food preferences. Cereal sales have been on the decline for several years, he said, and other morning beverages such as cold pressed juice and cold brew coffee that forgo dairy are on the rise. Another trend, he said, is the growth of organic milk, which cuts into traditional pasteurized dairy sales.

But Schwartz added that he would like to see the standard of identity for alt-milk better defined, particularly when it comes to nutrition.

“I think where there is real consumer confusion, and where the FDA really should get involved, is that there is no meaningful standard of identity that I know of for almond milk, cashew milk or soy milk,” he said. “You could have one cashew in an entire package and the rest could be water and sugar and call it cashew milk. So consumers are being duped.”

Thein said that’s something the industry could do, as well: by being conscientious about labeling, he said, it’s an opportunity to be honest up front.

“We in the industry, manufacturers innovators, are constantly coming up with new things,” Thein said. “It’s likely our innovation is always going to exceed the pace of regulatory law.”