Thousands of new state laws were passed across America this year, and dozens affect fermentation businesses — small and large — as well as home fermenters.
Government agencies are loosening some strict health code and alcohol regulations, laws that made running an artisanal business difficult. There are also new opportunities being created that allow craft breweries to expand their operations, such as entertainment districts where beer can be sold and enjoyed legally.
Read on for the breakdown of 2019 food laws passed in each state
SB16 — Expands state alcohol licenses to include recreational areas. After the Alaska Alcoholic Beverage Control Board began cracking down on alcohol licenses in 2017, several recreational sites were denied licenses to sell alcohol. The bill, known as “Save the Alaska State Fair Act,” now expands license types to the state fair, ski areas, bowling alleys and tourist operations.
HB2178 — Removes red tape for small ice cream stores and other milk product businesses to manufacture and sell dairy products. The bill, called the “Ice Cream Freedom Act,” allows smaller mom and pop businesses to make milk-based products without complying with state regulations designed for large dairy manufacturers.
HB1407 — Prohibits false labeling on agricultural products edible by humans. That includes misleading labels, like labeling agricultural products as a different kind of food or omitting required label information.
HB1556 — Ends the “undisclosed and ongoing investigations” of the Alcoholic Beverage Control Board, the Alcoholic Beverage Control Division, and the Alcoholic Beverage Enforcement Division.
HB1590 — Limits the number off-premise sales of wine and liquor in the state to one permit for every 7,500 residents in the county or subdivision. Small farm wines are the exception to the new law.
HB1852 — Allows a microbrewery to operate in a dry county as a private club, without approval from the local governing body.
HB1853 — Amends the Local Food, Farms, and Jobs Acts to increase the amount of local farm and food products purchased by government agencies (like state parks and schools).
SB348 — Establishes a Hard Cider Manufacturing Permit. Cider brewers can apply for the annual $250 permit, authorizing the sale of hard cider. Producers may not sell more than 15,000 barrels of hard cider a year.
SB492 — Establishes temporary or permanent entertainment areas in wet counties where alcohol can be carried and consumed on the public streets and sidewalks.
AB205 — Revises the definition of beer to mean that beer may be produced using “honey, fruit, fruit juice, fruit concentrate, herbs, spices, and other food materials, and adjuncts in fermentation.”
AB377 — A follow-up to the state’s landmark California Homemade Food Act in 2018, the new bill would clarify the implementation process of last year’s bill. The California Home Food Act made it legal for home cooks to operate home-based food production facilities. The law, though, was only enacted if a county’s board of supervisors voted to opt-in to offer the permits. Only one county in California has opted in (Riverside). County health officials are avoiding singing on the bill because of potential food safety risks.
AB619 — Permits temporary food vendors at events to serve customers in reusable containers rather than disposable servingware. The “Bring Your Own Bill” also clarifies existing health code, allowing customers to bring their own reusable containers to restaurants for take-out.
AB792 — Establishes a minimum level of recycled content (50%) in plastic beverage bottles by 2035. The world’s strongest recycling requirement, the law would help reduce litter and boost demand for manufacturers to use recycled plastic materials.
AB1532 — Adds instructions on the elements of major food allergens and safe handling food practices to all food handler training courses.
HB5004 — Raises minimum wage to $15 by 2023.
HB6249 — Charges 10 cents for single-use plastic bags by 2021.
HB7424 — Raises sales tax from 6.35% to 7.35% for restaurant meals and prepared foods sold elsewhere, like in a grocery store. Also repeals the $250 biennial business entity tax.
HB130 — Bans single-use plastic bags by 2021.
SB105 — Raises minimum wage to $15 by 2024.
HB125 — Facilitates growth and expansion of craft alcoholic beverage companies, raising amount of manufactured beer to 6 million barrels.
SB82 — Prohibits a municipality from regulating vegetable gardens on residential properties.
HB134 — Regulates where beer and wine can be served, now including public plazas.
HB151 — Charges licensing fees for temporary food establishments based on the number of days open. Fees will gradually increase through 2022.
HB3018 — Amends Food Handling Regulation Enforcement Act, requiring a restaurant prominently display signage indicating a guest’s food allergies must be communicated to the restaurant.
HB3440 — Allows customers to provide their own take-home containers when purchasing bulk items from grocery stores and other retailers.
HB2675 — An update to state liquor laws, the bill removes hurdles for craft distilleries to operate. Craft distilleries would be allowed to more widely distribute their products themselves, rather than distributing under the state’s three-tier liquor distribution system that separates producers, distributors and retailers.
SB1240 — Imposes a 7 cent tax on each plastic bag at checkout, with 2 cents staying with the retailers. The remaining 5 cents per bag would fix a statewide budget deficit.
HB1518 — Creates a special alcohol permit for the Bottleworks District. The $300 million, 12-acre urban mixed-use development in the Coca-Cola building will serve as a culinary and entertainment hub in downtown Indianapolis.
SF618 — Increases the limit on alcohol in beer from 5% to 6.25%.
SF323 — Canned cocktail and premixed drinks served in a metal can, up to 14% alcohol by volume, will now be regulated like beer.
HB311 — Requires proper labeling of cell-cultured meat products that are lab produced.
HB468 — Expands defined items permitted for sale by home-based processors.
HR251 — Designates week of September 23-29 as Louisiana Craft Brewer Week.
SB152 — Establishes definition for agriculture products. Prohibits anyone from mislabeling a meat edible to humans.
SR20 — Designates week of September 3-9th as Louisiana Craft Spirits Week.
LD289 — Prohibits stores from selling or distributing any disposable food containers that are made entirely or partially of polystyrene foam (Styrofoam).
LD454 — Provides funding and staffing needed to give local students and nutrition directors the resources needed to purchase and serve locally grown foods.
LD1433 — Bans two toxic, industrial chemicals (phthalates and PFAS) from food packaging. Maine becomes first state in the nation to ban the two chemicals.
LD1532 — Bans all single-use plastic bags in the state. Law will be enacted by April 2020, at which time shoppers can pay 5 cents for a plastic bag. Maine is the fourth state to pass a ban, joining California, New York and Hawaii.
LD1761 — Increases amount of barrels craft beer and hard cider manufacturers can produce in a year. The cap increased from 50,000 gallons to 930,000 gallons (approximately 30,000) barrels. The law also makes it easier for a small brewery to get out of a contract with a large distributor.
SB596 — Defined mead as a beer for tax purposes.
HB1010 — Updates state beer laws by increasing taproom sales, production capabilities, self-distribution limits and hours of operation. Known as the Brewery Modernization Act, the law is aimed to create jobs and increase economic impact.
HB1080 — No restrictive franchise law provisions for brewers that produce 20,000 barrels a year or less.
HB1301 — Sales tax will be collected on Maryland buyers from online sellers, helping small businesses compete with online retailers.
HB4111 — Raises minimum wage by 75 cents a year until it reaches $15 in 2023.
HB4959 — Gives state Liquor Control Commission the power to seize beer, wine, mixed spirit and mixed wine drinks, in order to inspect for compliance with the state’s extraordinarily detailed and complex “liquor control” regulatory and license regime. Bill also repeals a one-year residency requirement imposed on applicants for a liquor wholesaler license, after the U.S. Supreme Court invalidated a similar Tennessee law as a violation of the U.S. Constitution’s commerce clause.
HB4961 — Prohibit licensed liquor manufacturers from requiring licensed wholesalers to give the manufacturer records related to the distribution of different brands, employee compensation or business operations that are not directly related to the distribution of the maker’s brands.
SB0320 — Eliminates mandate that businesses with a liquor license must post a regulatory compliance bond with the state.
HF1733 — Updates the state’s omnibus agriculture policy law, including: create a custom-exempt food handlers license for those handling products not for sale; extend the state’s Organic Advisory Task Force by five years; allow the agriculture department to waive farm milk storage limits is the case of hardship, emergency, or natural disaster, and modify milk/dairy labelling requirements; modify labelling for cheese made with unpasteurized milk; expand the agriculture department’s power to restrict food movement after an emergency declaration; modify eligibility and educational requirements for beginning farmer loans and tax credits.
SB2922 — Prohibits labeling non-meat products as meat, like animal cultures, plants and insects.
HB84 — Changes tax on wine to 27 cents per liter, and a tax on hard cider at 3.7 cents per liter.
SB358 — Raises alcohol license fee for resorts from $20,000 to $100,000 each.
LR13 — Establish and enforce definitions for plant-based milk and dairy. Proper product labeling would be enforced for milk and dairy food products that are “truthful, not misleading, and sufficient to different non-dairy derived beverages and food products.”
SB345 — Authorizing pubs and certain wineries to transfer certain malt beverages and wine in bulk to an estate distillery; authorizing a wholesale dealer of liquor to make such a transfer; authorizing an estate distillery to receive malt beverages and wine in bulk for the purpose of distillation and blending; revising when certain spirits that are received or transferred in bulk are subject to taxation.
HB598 — Establish a commission to study beer, wine, and liquor tourism in New Hampshire. The commission will specifically develop a plan for tourism, including establishing tourist liquor trails with signage along the highway, suggest changes to liquor laws that would enhance tourist experiences at state wineries, breweries and liquor manufacturers and suggest how to allow a “farm to table” dinner featuring New Hampshire produced food items and local alcoholic beverages.
HB642 — Defining ciders with alcohol content greater than 6% (but no more than 12%) as specialty beers.
A15 — Raises the state minimum wage to $15 an hour by 2024, raising in $1 increments every year.
SB1057 — Establishes a loan program for capital expenses for vineyards and wineries in New Jersey.
SB149 — Change name of Alcohol and Gaming commission to Alcoholic Beverage Control Division.
SB413 –Allows breweries to: sell beer at 11 a.m. on Sundays; have private celebration permits for events like weddings and graduation parties; no minimum standards (50 barrels a year or 50 percent of all sales coming from beer brewed on site) for businesses to hold a small brewer license; eliminate excise tax, with breweries paying $.08 per gallon on the first 30,000 barrels produced.
“I’ve Never Seen Such A Time of Challenge” Grocery Industry Ripe for Disruption from Small- to Mid-Sized Brands
The grocery market is being disrupted in a way never seen before – and the opportunity for success is great for small- to medium-sized food brands wanting to get in the door.
“I’ve never seen such a time of challenge up and down the value chain from the seed all the way to the table,” says Walter Robb, former CEO of Whole Foods and the founder of investment firm Stonewall Robb. “We’re going to see a whole explosion in the new types of foods that are coming to market.”
A report by Biodiversity International found that three-quarters of the world’s food supply comes from just 12 crops and five livestock species. That jarring lack of diversity in the average diet is changing, Robb said. We’re in a frontier where food “will come back in a way we’ve never imagined.” More than 10,000 new products are introduced to the grocery market every year, and customers Robb said are “clamoring” for something new.
“We have a disruption up and down the value chain like I have never seen,” Robb said. “Your chance to come and bring a new product to market is there.”
Robb spoke at the NOSH Live event in New York, and shared insights into where the food industry is headed. Here are Robb’s five main points.
- Integrated Shopping
“The integrated retail is the table stakes for the future,” Robb said. “We’re going to see the line between digital and physical is going to collapse and it’s really going to be all about the customer and how you’ll serve the customer.”
The food industry will thrive on an “extended experience,” a term Robb came up with in the ‘90s while at Whole Foods. The extended experience extends outside the four walls of the stores. The problem at Whole Foods, Robb pointed out, was the natural grocer didn’t digitize fast enough. So in 2017, Amazon bought Whole Foods in a $13.7 billion deal.
Though customers are making more digital purchases, they are not abandoning physical stores. In five years, 50-60% of business will be done via retail stores.
“The future is one that integrates humanity and technology,” Robb said. “Why? because human beings are human beings and they want connection and community and that’s simply not available online. The most successful brands today and the ones that do more physical and digital.”
He pointed to Target as an excellent integration example for modern shoppers. Shoppers can still go to the store, where Target is remodeling physical locations to enhance the in-store experience, but they can use the Target app to prepopulate a shopping list, check real-time stock and order at home for drive-up pickup.
“Data shows the customers likes to do both (online and in-store shopping),” Robb said. Brands who want a lifetime legacy need to be in both places. “The customer is clearly saying ‘Let me do what I want, when I want.’ And brands that don’t serve them in that way will not see the type of growth that they could if they would. The customer is in charge of the choices now.”
- Microbiome is the Future
The microbiome will “completely revolutionize the food industry” as the future of grocery retail is driven by customers who want to see authenticity with the brand they’re supporting.
Robb pointed t a New York Times article on personalized diets, “The A.I. Diet.” As more research publishes on the microbiome, personalized diets will play a huge role in shopping habits. Medicine and technology are converging with food.
- Create Purpose-Driven Brand
Brand leaders in the 21st Century must be authentic, vulnerable and humble. They must be purpose-driven to be successful, Robb said.
“The whole reason you’re in business is not to make money, money is a byproduct,” Robb said. “What you’re in business to do is to bring change to the world. That’s what purpose is. Purpose is the why, why do you exist as a company. You damn well better have a good answer to that question as to what you’re doing in business. You better be here for some great reason to make an impact on the world. And if you’re not playing on that level, either w your customer or your team members, you’re going to fall behind because the companies that are going to lead with some sense of purpose are going to be the companies that win in the next number of years.”
He advised brands to get fired-up about principles that support values. The company culture is a result of that principles and values, and culture is dependent on how team members feel working for the brand and customers feel buying from the brand.
“The winning formula today is road runners and roots,” Robb said. Roots ground a brand in purpose, but brands can’t cement themselves in the ground. They must be a road runner and change on a dime as the marketplace shifts.
- Solve Customer Confusion
The International Food Council found 80% of customers are confused on their food choices. There are dozens of food tribes dominating grocery shelves, like gluten-free, keto, paleo and Whole 30. With an overload of information, customers don’t know exactly what to buy for their desired health benefits.
Robb said one of the business opportunities for brands today is to figure out how to communicate more clearly with the consumer. Consumers want to make informed choices, but “that last mile of data has not been solved for.”
He pointed to solutions in connected homes devices like Amazon that will now populate a shopping list for the consumer based on past purchases. Consumers don’t even need to pick out what they want, their only roll will be to confirm the purchase.
- Natural Reigns
Organic has grown to a $65 billion industry, with a 7-8% growth rate; conventional food, meanwhile, is only growing at 1-2%. Major mainstream retailers are rushing to get into the natural food business today.
Robb said the best way for brands to get on the shelves at Whole Foods is to push the envelope. Whole Foods continues to lead the natural market, and the grocer wants to see edgy, new products with a new take.
Customers expect food brands today to be transparent, accountable and responsible. Robb said there are 2,000 natural flavors approved for use in food by the Food and Drug Administration. But Robb encouraged brands to solve that problem – use less processed ingredients and more natural ingredients, “let’s continue to lead by showing there’s a new edge in the food industry.”
Consumers are in favor of allowing plant-based food to use traditional dairy terms on their labels — but dairy farmers are strongly opposed to it. Last year, the U.S. FDA issued a public comment period to examine if plant-based foods and beverages should use the traditional dairy names: milk, cheese and yogurt. The results are out. Of those comments, 76 percent were in favor of using dairy terms on plant-based products, 13.5 percent were against and the remaining 10.5 percent were inconclusive. Of the commenters that identified themselves as dairy farmers, nearly all were opposed. Dairy farmers are concerned consumers will believe plant-based foods are nutritionally similar to cow’s milk (94 percent) and that consumers are being misled with a dairy term on a plant-based item (91 percent).
Read more (Linkage Research)
The fermentation industry is on the cusp of a renaissance. Engaged consumers are seeking functional food and drink with health benefits. And fermented products provide the nutritional value and unique flavors today’s consumers crave.
Staff at The Fermentation Association attended Natural Products Expo West in Anaheim, Calif. this month. Expo West is the world’s largest organic and natural healthy products event, and we spent four days with 88,000 other attendees listening to industry experts in education sessions and meeting fermented food and beverage brands on the show floor.
Here are six takeaways from Expo West for the fermentation industry:
- Natural Products are King. Natural food and beverages grew 6.6 percent in 2018, for a total of $152 billion in sales, according to info from the Nutrition Business Journal. The category is growing so much that organic supply is lagging behind consumer demand. Meanwhile, for the first time in history, the conventional food and beverage category began to shrink last year.
- Major Focus on Gut and Microbiome Health. Once terms only used by scientists, prebiotics and probiotics are at the forefront of consumer’s grocery list. Digestive health is critical for modern consumers, as more nutritionists focus on the gastrointestinal tract’s critical immune system support. Consumers want food and drinks that nourish their microbiome. Sales numbers show people are moving away from purchasing pills and supplements to aid their gut; they’re instead looking for prebiotics and probiotics in actual food.
- Ancient Foods are Experiencing a Revival. The future of food is in practices of the past. From turmeric, ashwagandha, ghee and fermentation, the foods of our ancestors are back on our plates. These old-world cooking styles and ingredients are standing the test of time and coming back in modern cuisine.
- Industry is Selling to Educated Consumers. Today’s consumers know more about the food they eat than ever before. Consumers are studying ingredient lists, seeking product sources and researching brands. Clean food and clean labels are not a trend; they’re a movement. People are becoming more aware of the dangers of eating processed food. They want nutritious ingredients from ethical brands. The functional health benefits of fermented products are piquing consumer interest.
- Snacking Trumps Mealtime. Snacking today is a $1.2 trillion-dollar industry. The modern consumer is busy, and convenience food readily accessible in a grab-and-go format is a grocery store staple. Snacking in 2019 is not filling up on a soda and a bag of fried chips. Consumers want healthy, fresh snacks, especially refrigerated snacks in the produce aisle. This is great news for fermented brands. Grabbing a bottle of kombucha or kefir and a bag of snacking pickles or miso soup fits into the convenient dining lifestyle.
- Brands Need More Plant-Based Products. A major shift in food philosophy, more consumers are buying plant-based products – whether or not they’re vegetarian or vegan. Plant-based options are becoming tastier and readily available. Brands are experimenting with fermenting vegetables for plant-based cheeses, spreads, sauces and drinks.
It’s an exciting time for fermented food and beverage producers. The aromatic, tangy flavors and healthy, live bacteria in fermented products are qualities propelling fermentation to become one of the most popular food categories.
The new “it” clean food label: Glyphosate Residue-Free Certification. The main ingredient in weed killer, glyphosate is the most heavily used pesticide in the world. A probable human carcinogen, Forbes estimates it’s about to become a household name consumers will cut out of their food. Though glyphosate is banned in organic crops, it still drifts into the organic food supply, especially in anything oat-based. The new label is awarded by 3rd-party The Detox Project, who regularly tests brands for glyphosates. Costing $1,472 per year, the certification was first granted to Foodstirs, the organic baking company launched by actress Sarah Michelle Gellar and Galit Laibow.
Read more (Forbes) (Photo by: Foodstirs)
“Use By” dates are becoming uniform, with nine in 10 grocery store products now printing consumer-friendly labels. By 2020, all products will carry the more simplified date. The industrywide initiative aims to stop confusion over product expiration dates by standardizing wording on all products. The 10 date-label categories are now paired down to two – “Best If Used By” or “Use By.” Surveys found “when in doubt, throw it out” causes massive food waste in America, partly because of unclear food labeling. Over 90 percent of Americans throw out food because of a misunderstood label. Americans waste 133 billion pounds of food a year, a third of the U.S. food supply.
Read more (Supermarket News)
The U.S. Association of Cider Makers is creating a universal dryness scale, a number that can be put on labels to designate whether the cider is dry, semi-dry, semisweet or sweet. As ciders experience a revival in the U.S., the No. 1 issue is customers assuming all ciders are too sweet. Many feel this was the downfall of the popular Riesling wine movement of the late 2000s/early 2010s. The scale could be applied to all fermented beverages, where dryness factors could be tested in a lab.
Read more (Washington Post)
Ever wondered how the government defines “healthy” on American food labels? The FDA is taking comments until today on their nutrition innovation strategy. The FDA plans to modernize what goes on an American food label, like should plant-based dairy alternatives be called milk? And how should new food technology that reduces sodium or fat content be labeled?
Read more (FDA) (Photo: Foodies Feed)
The FDA “Certified Organic” label is a double-edged sword for many food producers. The coveted certification is great marketing to consumers, but it’s a regulation nightmare to obtain. Bread bakers who use these smaller, local ag businesses for their ingredients must sell non-organic bread. Because of it, notes Milling & Baking News, the industry is dominated by big-name producers.
Read more (Baking & Snack)