Mandatory Ultra-Processed Food Labels Could Cost $14.2 Billion Yearly, Analysis Estimates

The work, published Oct. 17, models a hypothetical mandatory labeling policy. It is not a test of whether labels change health. The FDA has not published its own proposed definition of ultra-processed food, so the researchers used one released in May 2026 by Healthy Eating Research. Under it, a product counts as ultraprocessed if its ingredient list contains at least one marker ingredient. Markers include flavors, colors, non-sugar sweeteners, emulsifiers and thickeners. They also include industrial carbohydrates, modified fats and industrial proteins.

The researchers applied that rule to nearly 450,000 products in the USDA Global Branded Food Products Database. They found 72.3% qualified. Confectionery, baked sweets, soda, pasta dinners and frozen appetizers were nearly all ultra-processed. Rice, frozen vegetables and canned vegetables were least likely to qualify. According to the researchers, ultra-processed foods make up 51% of money spent on food eaten at home.

That breadth is the central issue for shoppers. A label that applies to most of the shelf may not help people tell products apart. According to the article, the definition could cover items that consumers and retailers would not expect to see flagged, including products promoted as healthy. The source does not assess whether such labels would improve health.

The $14.2 billion estimate has three parts: $9.5 billion a year to reformulate products so they avoid the label, $4.5 billion for substitute ingredients, and $200 million for federal administration, relabeling and classification. The researchers estimate $8.1 billion of that reaches consumers through higher prices, about $60 per household. They say the consumer loss rises to $9.8 billion if companies let product quality fall rather than pay for substitute ingredients.

The authors describe the figure as a lower bound. It leaves out effects on suppliers, which could include about $1 billion a year in lost domestic agricultural revenue and $7.7 to $8.7 billion a year in higher food import costs. The Consumer Brands Association, an industry trade group, adds that it also leaves out litigation costs. Those would be possible legal claims, such as deceptive marketing suits over products called "healthy" or "natural" that also meet a federal ultra-processed definition. They are not established consequences, and early legal attempts have hit hurdles in court.

The policy context is unsettled. The FDA sent its proposed definition to the Office of Management and Budget on Aug. 3 as a white paper rather than through formal rulemaking, which limits its legal force. HHS Secretary Robert F Kennedy Jr has indicated he wants to use it to create a label claim, symbol or possible "stoplight" system. The FDA has said the white paper is not "economically significant," meaning an expected impact under $100 million. The two figures are not directly comparable, because the FDA assessed the definition and the researchers modeled a labeling policy built on it.

The Consumer Brands Association calls a definition capturing nearly 80% of the food supply "fundamentally flawed." It argues for clear nutrition facts and supports the voluntary Facts Up Front program instead of broad processing-based categories. Its 80% figure refers to the FDA's definition, which the researchers did not have. Their 72.3% comes from a different definition.

What to watch next

Whether the Office of Management and Budget review ends with a published FDA definition, and whether any label, symbol or stoplight system is formally proposed.