Retired doctor Louis Offen and his wife have been shopping at the same Giant supermarket in Bethesda, Md., for nearly 40 years. Offen is in charge of buying the steak, which normally means combing the meat section for New York strip sirloins with the label “USDA grade choice,” the mid-level grade for meat. The cut is ubiquitous.
But one day last month, Offen was stumped. He couldn’t find any packages with a “choice” label. He couldn’t find lower-quality beef, called “select,” either. All he found was an unfamiliar blue crest that read “USDA graded” on every package of beef. “Isn’t all beef sold in stores USDA graded, making that label useless?” he asked.
In recent weeks, Giant stores nationwide changed their labeling procedures, making it difficult for customers to know the quality of meat. Rather than providing different options, the company labeled meat simply as “USDA graded” — a description that applies to all but a tiny amount of meat approved for sale in the United States.
Larry Meadows, a Department of Agriculture official who is one of the people charged with overseeing the nation’s meat supply, said in an interview that the action was problematic. “We’ve never seen anyone use anything like the ‘USDA graded’ label before,” said Meadows, associate deputy administrator of the USDA’s livestock, poultry and feed program. “The label is truthful, but it’s also misleading.”
Meadows said one reason a company might use a more generic label is to save money, or to blur the impact of introducing an unusually high amount of lower-quality beef.
Giant’s corporate parent, Ahold USA, which was ordered to stop the practice, acknowledged the change in labeling at its stores, which include Martin’s, Stop ’N Shop and the grocery delivery service Peapod.
Tracy Pawelski, a top spokeswoman, said the new label was part of a brand rollout, but the firm later learned from regulators that it was “not permissible” because it did not tell customers the quality of meat. “We apologize to customers for any confusion caused by this labeling error,” she said in a statement.
As of Friday, the label was still in use. Pawelski said the company aims to put new meat labels in place this week.
A national problem of mislabeling food
What transpired at Giant and its sibling companies reflects what food safety experts say is a growing concern about food and supplement manufacturers misusing labels. The experts say that labels are supposed to allow customers to make more informed decisions, often granting a distinction of quality or making claims about health and safety, but they have instead turned into advertising vehicles.
“Food labeling has become an incredibly powerful marketing tool,” said Bill Marler, a lawyer and food safety expert who regularly represents consumers in claims against food companies.
Food packaging, in particular, has been blamed for alleged customer misinformation. Recently, PepsiCo decided to strip “all natural” claims from its Naked Juice line, saying that the products are natural but that it needed more regulatory guidance. Kellogg’s did the same for some of its Kashi products, while saying it stood by its advertising. Both companies faced lawsuits accusing them of misleading customers.
In 2010, the Food and Drug Administration issued warning letters to 17 food manufacturers, mandating that they correct labels that made unfounded health claims. That same year, Dannon agreed to a settlement with the Federal Trade Commission over claims it made about the health benefits of its yogurt.
The number of food labels has skyrocketed in recent years, often using dietary, nutritional and cultural trends to nudge consumers to buy a specific good.
In 2010, nearly half of all new food and beverage products came with a health- or nutrition-related claim, up from 25 percent in 2001, according to a report by the USDA’s Economic Research Service.
Today, the food industry sells $377 billion worth of food labeled with the 35 most common claims, including “natural,” “organic” and “carb conscious,” according to data from the market research firm Nielsen.
“Companies have always tried to make their food sound as attractive as possible without violating any laws or regulations,” said Michael Jacobson, the executive director of the Center for Science in the Public Interest. “Labels have become a battleground where companies use every trick they can muster, which is a problem because consumers tend to be naive.”
Food and beverage manufacturers disagree, insisting that labels reflect a desire to provide customers with better information about what they’re buying.
“The primary purpose for claims and nutrition symbols used on food labels is to provide positive dietary guidance,” said Brian Kennedy, director of communications for the Grocery Manufacturing Association, which represents hundreds of food companies. “There is a robust regulatory system in place to ensure the proper use of claims and other symbols on food labels.”
How the USDA learned about Giant's change
The USDA received its first complaint about the new Giant label on Sept. 22, according to the agency’s Meadows. More queries came flooding in.
The USDA grades beef and regulates labeling practices. By law, all beef sold in the United States must be inspected for health safety. For an additional fee, the USDA will grade the product, based on a series of guidelines including tenderness, juiciness, flavor and marbling (the distribution of fat).
The practice, while optional, is effectively an industry standard. About 94 percent of beef sold in the United States is graded, Meadows said.
“Choice” grade beef is high quality, and “very tender, juicy and flavorful,” according to the USDA. “Select,” meanwhile, is less tender, has less marbling, and “may lack some of the juiciness and flavor of higher grades.”
Meadows said he didn’t immediately have answers for those who complained, because, like them, he was surprised.
When he reached out to Ahold, the parent of Giant and its siblings, the company’s head of compliance pinned the labeling switch on Ahold’s marketing team, Meadows said.
“He indicated to me that the marketing team came up with the brilliant idea, as he called it,” Meadows said. “But he also agreed that they weren’t being as transparent as they were in the past.”
Meadows said Giant may have seen an opportunity to package different grades of beef with one label, rather than two. Doing so could save the company money by allowing them to store all of its packaged meat together, he said.
Meadows also said changing the label would prevent a broader negative reaction from customers if the company was using more low-quality meat.
“We knew nothing about the new label, because it was changed without our knowledge,” he said. “It took us by surprise. It wasn’t common at all, it wasn’t normal.”
Within days, Ahold committed to addressing the issue. Giant is reverting back to its previous practice, whereby most beef is level “choice,” and labeled as such. The retailer also will sell the lower-quality “select” grade.
Pawelski, the Ahold spokeswoman, said the new labels came on Butcher Shop brand meat. The new labels will be “clear to customers and in full compliance with USDA standards.”
Offen, the meat buyer in Bethesda bewildered by the new label, is now a little bit more distrustful of his longtime supermarket.
“It lessened my faith in the company, in the brand,” he said. “But what can you do? It’s not like there are many other options. I’m not even sure what my alternatives are.”
Lack of options notwithstanding, Offen has shied away from buying beef at Giant. He doesn’t plan to resume his habit of purchasing New York strip sirloins until he knows he isn’t getting the lowest quality meat.
“I’d think twice about buying meat there at all,” he said.