FDA Moves to Phase-Out Synthetic Dyes: What Retailers Must Do Now

Executive Summary

The FDA is taking historic action to phase out petroleum-based synthetic dyes from the U.S. food supply, with Red Dye No. 3 already banned effective January 2027. For retailers, this represents both a challenge and an opportunity:

• Impact: 36% of all products using Red No. 3 are private label items
• Consumer Demand: 48% of U.S. consumers already avoid artificial colors
• Timeline: Retailers should begin reformulation immediately to avoid regulatory issues and market disadvantages
• Solutions: Natural alternatives like beet extract, turmeric, and spirulina can replace synthetic dyes
• Action Required: Audit product portfolio, engage R&D, test formulations, update packaging, and educate teams

Artificial food dyes have long been used to give candies, cereals, and snacks their eye-catching hues. But this year the FDA is taking historic action to begin phasing out these petroleum-based color additives from the U.S. food supply (HHS, FDA to Phase Out Petroleum-Based Synthetic Dyes in Nation's Food Supply). From the notorious Red No. 3 to the many numbered dyes in between, regulators are responding to decades of consumer concern and scientific scrutiny. Retailers and food manufacturers must now prepare for a new era of clean-label product development.

For example, Red Dye No. 3 – a coloring linked to cancer in lab animals – is finally slated for removal from foods after years of controversy (FDA bans red dye No. 3 over link to cancer in rats). The FDA formally banned Red No. 3 in food and beverages, giving manufacturers until January 2027 to eliminate it from their recipes. Now the agency is even asking companies to drop Red 3 sooner than that timeline (HHS, FDA to Phase Out Petroleum-Based Synthetic Dyes in Nation's Food Supply) as part of a broader push to eliminate all artificial dyes in favor of natural alternatives. In short, the FDA's stance on synthetic colors has fundamentally shifted, and the message is clear: the era of neon-bright, artificially dyed foods is coming to an end.

Why This Matters for Private-Label and Store Brands

These changes carry big implications for private-label and store-brand teams. Many store brand products—from colorful cereals to seasonal candies—rely on now-targeted dyes like Red 3, Red 40, Yellow 5, and others. In fact, a recent analysis found that roughly 36% of all food products using Red No. 3 were private label items (Here Are Replacements for Banned Color Additives). That means the FDA's ban on this dye (and impending bans on others) directly hits retailers' own brands, not just the national brands on your shelves. Retailers will need to reformulate a significant portion of their portfolio to comply with the coming regulations.

Beyond compliance, there's a consumer trust factor at play. Shoppers have been gravitating toward "clean label" products free from artificial ingredients. A Nielsen survey found 48% of U.S. consumers actively avoid products with artificial colors, and 37% are willing to pay more for foods that use natural colorings instead (Natural food coloring: is consumer demand impacting the industry?). Parents, in particular, have grown wary of candies or drinks with chemical dyes due to health concerns. If a store brand continues to use synthetic dyes while others proudly tout "no artificial colors," retailers risk losing credibility and sales. In the age of social media, consumer backlash can be swift—especially if competitors or national brands position themselves as the healthier, dye-free choice.

Lastly, private labels often pride themselves on being in tune with customer values and market trends. Embracing the FDA's new guidance quickly is an opportunity for store brands to lead rather than lag. It shows that your brand is proactive about quality and safety, which can strengthen customer loyalty. On the flip side, failing to act could leave your private-label products looking outdated or "unsafe" in comparison to reformulated competitors.

Clean-Label Color Alternatives to Consider

The good news is that nature provides plenty of colors – and savvy product developers have more options than ever to replace synthetic dyes. Food manufacturers are already turning to plant-based and mineral-based colorants that can deliver vibrant hues without the baggage of petrochemicals. For example, common alternatives to artificial red dyes include fruit and vegetable extracts from beets, pomegranates, or even tomatoes (Here Are Replacements for Banned Color Additives). These can impart red and pink tones in everything from frosting to fruit snacks. For yellow and orange shades, ingredients like turmeric, annatto (from achiote seeds), or beta-carotene can be used. Deep blues and purples can come from sources like spirulina algae, butterfly pea flower, red cabbage, or purple carrot extracts. Even green hues can be achieved with mixtures of plant extracts (like spinach or pandan leaf) instead of FD&C Green No. 3.

Switching to natural colors isn't always plug-and-play – these ingredients have different stability and cost profiles. It's important to note that natural colorants can be more expensive and sometimes trickier to work with than their synthetic counterparts. Factors like pH, heat, and light can affect a natural dye's performance. For instance, beet juice might give a lovely red in a chilled beverage but turn brown under high-heat baking; turmeric provides a bright yellow but could add a slight flavor note. However, food tech innovation is rapidly improving these alternatives. Companies in the ingredients sector have developed refined natural color formulations (from carrot concentrates to algae-derived blues) that withstand processing and deliver consistent results. The FDA itself is fast-tracking approval of new natural color additives to facilitate this industry shift (HHS, FDA to Phase Out Petroleum-Based Synthetic Dyes in Nation's Food Supply).

For private-label teams, now is the time to start experimenting with clean-color formulas. Many brands have already made partial moves in this direction (for example, using vegetable juices for color in "organic" sub-lines). With the FDA's phase-out looming, those exploratory projects need to become full-fledged reformulation initiatives. The key is to find the right alternative for each product that maintains the expected look and taste. A cereal that's always been vibrantly red might use beet or berry extract in the new version; a candy that relied on Red 40 could achieve a similar shade by blending natural reds with a touch of paprika or carotene for orange balance. It is possible to get appealing colors without synthetic dyes – and doing so will ensure your products meet the coming rules and satisfy ingredient-savvy shoppers.

The Risks of Delaying Reformulation

What if a retailer decides to take a "wait and see" approach? In short: that's a risky gamble. Delaying action on synthetic dyes could lead to several headaches for private labels:

• Regulatory Pressure and Patchwork Bans: Even before federal deadlines hit, state-level bans are emerging. California, for example, banned Red No. 3 in foods starting in 2027, and at least 10 other states have introduced similar bills to prohibit harmful food dyes (FDA bans red dye No. 3 over link to cancer in rats). This patchwork of laws means if you don't reformulate in time, you may find your products cannot be sold in key markets or will require state-specific versions – a logistical and financial nightmare. The FDA's nationwide timeline (targeting end of 2026 for most dyes) may still seem far off, but large retailers know how long product development can take. Waiting until late 2025 or 2026 to start could leave too little time for testing, sourcing new ingredients, and scaling up updated recipes.

• Consumer Backlash and Brand Damage: As noted, consumers are increasingly aware of artificial additives. If headlines are announcing that "FDA says these dyes are linked to health risks" and your store brand is slow to remove them, shoppers will notice. Public perception can turn quickly. Nobody wants their brand trending for the wrong reasons ("XYZ Grocery still using banned dyes in their cereal!"). By acting late, you not only risk negative press, but you miss the chance to market the positive change. There's a first-mover advantage in claiming "Now with all-natural colors" on your packaging and promotions – it shows leadership. Coming to the party after everyone else means you're doing it as a catch-up, not as a value-driven choice, which dilutes the goodwill you could earn.

• Higher Reformulation Costs Later: Reformulating a product isn't just swapping one dye for another the week before a ban takes effect. It involves R&D trials, possibly new suppliers, packaging updates, and sometimes even machinery tweaks (natural colors might behave differently in production). Rushing this process due to a looming deadline can incur rush fees, overnight label redesigns, or last-minute scrambles for scarce natural ingredients (imagine everyone chasing butterfly pea extract at once). By contrast, starting now allows for strategic sourcing and cost optimization. You can lock in contracts for natural colorants before demand spikes. You have time to tweak the recipe for taste and appearance, and possibly phase in changes gradually to manage cost impact. Simply put, procrastination could make the whole endeavor more expensive and chaotic.

• Missed Market Opportunities: There's also an upside risk to consider: the opportunity you lose by delaying. Clean-label is a selling point. If your competitors reformulate sooner, they get to attract health-conscious consumers and market their products as "free from artificial dyes" while you're still figuring it out. Private labels have made huge quality strides in recent years – many shoppers equate a retailer's brand with good value and decent quality. Don't let outdated ingredients undermine that progress. By moving quickly, you can even position your store brand as a leader that perhaps even exceeds national brands in purity. That's a marketing win that can drive sales and strengthen brand equity.

Given these risks, the safer path is clear: act now rather than later. The next section outlines concrete steps retailers should be taking immediately in response to the FDA's new direction.

Action Plan: What Retailers Should Do Now

To stay ahead of the synthetic dye phase-out, private-label and product development teams should kickstart a plan of action. Here are key steps to tackle in the coming weeks and months:

1. Audit Your Product Portfolio: Identify all private-label products that contain FD&C synthetic dyes (Red 3, Red 40, Yellow 5, Blue 1, etc.). Prioritize by those most at risk (e.g. anything with Red No. 3 should be at the top of the list due to its 2027 ban (FDA bans red dye No. 3 over link to cancer in rats), but remember the FDA intends to nix all petroleum-based dyes soon (HHS, FDA to Phase Out Petroleum-Based Synthetic Dyes in Nation's Food Supply)).

2. Engage R&D and Suppliers for Alternatives: For each product, research viable natural color replacements. Talk to ingredient suppliers about options like beet or carrot extracts, spirulina, turmeric, annatto, paprika, and fruit concentrates. Many suppliers now specialize in clean-label color solutions – leverage their expertise to find the best match for your needs (hue, pH stability, cost, etc.).

3. Test and Refine Formulations: Expect some trial and error. Begin benchtop tests of new formulations now, under various conditions (shelf-life, heat, light exposure) to ensure the natural colors hold up. You may need to adjust recipes (a pinch of an acid or antioxidant here, a tweak in processing there) to get the same visual pop. Starting early gives you breathing room to perfect the product so that consumers notice no drop in quality – only the absence of artificial ingredients.

4. Update Packaging and Labeling: Plan ahead for packaging changes. Once you successfully reformulate, proudly declare "No Artificial Colors" on the label or add a clean-label badge. Marketing can begin crafting messaging about the change (blog posts, shelf tags, social media content) to educate consumers. Turning a regulatory must-do into a brand story ("We did this for your family's health") can convert a compliance cost into a marketing investment.

5. Educate and Train Your Teams: Ensure your category managers, buyers, and marketing teams understand why you're making these changes. Arm them with talking points on the FDA's new guidelines and the benefits of natural colors, so they can communicate consistently. Frontline staff and customer service should be ready to answer questions (for instance, if a product color looks a bit different, or if shoppers ask "what's annatto?"). Internally, treat this as a company-wide quality initiative.

6. Consult Experts if Needed: Don't hesitate to bring in clean-label consultants or partners to help navigate the transition. Firms with expertise in food science and regulatory compliance can provide guidance on tricky formulations or suggest reliable suppliers for natural additives. Sometimes an outside perspective accelerates the project by avoiding pitfalls others have encountered in similar reformulations.

By following these steps, retailers can confidently steer their private-label programs through the coming dye transition and emerge in a stronger position.

Private Label Advisors: Your Partner in Clean-Label Transformation

At Private Label Advisors (PLA), our mission has always been to help retailers stay ahead of industry shifts and meet consumer expectations. The move away from synthetic dyes is exactly the kind of challenge we've been preparing our clients for. PLA has long advocated for clean-label practices, and we've developed deep expertise in the realm of natural ingredient sourcing and formulation. Our team believes that phasing out artificial colors isn't just about avoiding risk – it's about building a better brand that resonates with today's health-conscious shoppers.

PLA's stance is clear: we welcome the FDA's push to eliminate petroleum-based dyes, and we see it as an opportunity for innovation. Our advisors have been tracking the science and regulatory landscape on food colors for years. We understand the nuances – from the Delaney Clause that prompted Red 3's ban (FDA bans red dye No. 3 over link to cancer in rats) to the consumer behavior trends driving demand for transparency (Natural food coloring: is consumer demand impacting the industry?). This perspective allows us to guide retail brands in making informed, future-proof decisions. We don't want our clients to just meet the minimum requirements at the last minute; we want you to leverage this change to differentiate your products.

On the capabilities side, PLA offers hands-on support for clean-color reformulation. This includes connecting you with trusted suppliers of natural colorants (whether you need a stable red for a fruit snack or a vibrant green for a icing drizzle), helping to run pilot tests for new formulations, and coordinating sensory panels to ensure the product experience remains top-notch. We also assist with the often overlooked aspects, like calculating any cost impacts and suggesting where you might absorb or pass on those costs, as well as reviewing label compliance once you've switched ingredients. If your team is stretched thin, our experts can serve as an extension of your R&D or quality assurance department specifically for this initiative.

Most importantly, PLA approaches these projects with a cross-functional mindset. Successful ingredient overhauls require alignment between procurement, product development, marketing, and even legal/regulatory teams. We facilitate that alignment. For example, as you swap out Red 40 for a carrot extract, we help ensure your packaging claims are updated and compliant, and that your marketing folks have the education to avoid missteps (you can't, for instance, claim "no additives" if you're using natural additives – but you can say "no artificial colors" which is a strong selling point). Our goal is to make the transition smooth and to turn what could be seen as a headache into a win for your brand.

In short, Private Label Advisors is committed to your clean-label success. We've helped clients reformulate products to eliminate everything from HFCS to artificial preservatives; now, we're ready to tackle synthetic dyes hand-in-hand with your team. We view this FDA phase-out as a chance to elevate your private label line's quality and trust with consumers.

The clock is ticking on artificial dyes, but with the right strategy, your brand can thrive in this new environment. If you're looking at your product lineup and wondering where to start, or if you need a knowledgeable partner to accelerate your dye-removal project, we're here to help. Contact us today to schedule a discovery call with Private Label Advisors – together, we'll create a roadmap to keep your offerings compliant, appealing, and ahead of the curve. Let's turn this transition into a transformative upgrade for your private-label brand.