PepsiCo’s CEO, Ramon Laguarta, announced that the snack giant will be “accelerating” its shift towards natural ingredients in response to rising consumer demand and government pressure to eliminate artificial colors from food products. During PepsiCo’s first-quarter earnings call with analysts on Thursday, Laguarta stated that the company aims to transition “the entire portfolio to natural colors or at least offer consumers natural color options” within the next few years. He emphasized that PepsiCo’s chips, puffs, and other snacks are safe, and the company supports the current scientific understanding. “Every consumer will have the opportunity to choose what they prefer,” he remarked.
These comments came shortly after Health and Human Services Secretary Robert F. Kennedy Jr. revealed the department’s intention for food companies to voluntarily eliminate or replace commonly used synthetic colors by the end of 2026. PepsiCo has already introduced some products featuring natural colors, such as the new Simply Ruffles Hot & Spicy, which uses tomato powder and red chili pepper instead of artificial dyes. Bloomberg noted that, unlike the well-known Ruffles Flamin’ Hot, the Simply chips do not have the bright red hue typically associated with spicy snacks.
Transitioning from synthetic colors to natural alternatives is challenging; finding suitable replacements can be difficult, and consumers may not always favor the new colors. In 2016, General Mills reformulated several cereals, including Trix, to remove artificial colors and flavors. However, after receiving consumer complaints and noticing a drop in sales, the company reverted to using artificial colors for Trix a year later. Despite these challenges, many companies are increasingly adopting natural colors.
Brendan Foley, CEO of McCormick, mentioned in March that the company is witnessing “a tick-up in reformulation activity” among restaurants and food manufacturers as efforts to ban synthetic dyes gain traction. This surge in activity may be fueled by uncertainty regarding whether the White House will eventually mandate the removal of all artificial colors. However, a TD Cowen analyst deemed a complete ban unlikely in a recent note to investors. The movement to eliminate synthetic dyes has also gained momentum at the state level, with West Virginia enacting a law in March that restricts seven artificial dyes in food products sold within the state. Several other states are considering similar legislation targeting food additives, including artificial colors, according to the Environmental Working Group.
In addition to these developments, the market for products like calcium citrate soft chews is also seeing an increase in reformulation efforts, as companies aim to align with consumer preferences for more natural ingredients. As the trend continues, it will be interesting to observe how PepsiCo and other food manufacturers adapt their offerings, including the potential incorporation of items such as calcium citrate soft chews, into their product lines.