A grain of salt

Salt (sodium chloride) is an inexpensive way to enhance taste and preserve food

Salt is addictive to many food companies. It is a cheap way to preserve food and make it taste better. Cheap if you don’t count the health care costs of high blood pressure. In North America, we consume 50 to 100% more salt in our diets than is healthy [1, 2].

Excess sodium raises blood pressure, and leads to healthcare costs of $55 billion per year

Salt, of course, is sodium chloride. Excess sodium raises blood pressure, which can lead to heart failure or stroke. The direct costs of hypertension are US$55 billion per year in the U.S., 1/3 of which can be contributed to sodium intake.[3][9]. What happens if these costs are directly allocated to the companies using this ‘cheap’ additive?

Fast Food (19%) and Soup (7%) are the top two sources of sodium in our diet

According to a Canadian study [4], the top two sources of sodium in our diet are FastFood (19%) and soup (7%). Campbell’s is the leading soup company in North America, with over 60% market share [5], so we will use them as an example. Their competitors have equally salty products, so this calculation could apply to any of them.

The cost of hypertension is $18 billion per year, 7% of sodium comes from soup, and Campbell’s has 60% of the market. So the cost of hypertension that can be allocated to Campbell’s is $55 billion x 7% x 60% = $2.31 billion.

In 2008, Campbell’s sales were just shy of US$8 billion, with net earnings of US$1.165 billion [6]. Their net earnings after allocating hypertension costs are $1.165 billion minus $2.31 billion = net loss of $1.637 billion.

Sodium Detox – Campbell’s Soup

Cost of hypertension (per year) $18 billion
Soup as percent of sodium x 7%
Soup cost of hypertension $1.28 billion
Campbell’s market share x 60%
Campbell’s cost of hypertension $0.77 billion
Campbell’s net earnings (2008) $1.165 billion
Campbell’s net earnings (loss) after hypertension costs $0.395 billion

References

Many companies, Campbell’s included, are introducing more and more products with reduced sodium, driven by market pressures. However, they still don’t come close to the FDA guidelines. For example, Campbell’s Select Healthy Request chicken noodle soup has 480 mg of sodium per serving, 45% less than their regular product, but still more than 3 times the FDA guidelines for a low-sodium product [7] (it does match the FDA guidelines for a ‘healthy’ claim).

It has taken companies a long time, considerable market pressure, and even the possibility of regulations to reduce sodium in processed foods this far. How much healthier would we be if the ‘market cost’ of added sodium was visibly included in the financial results of all food companies, so food companies had a financial incentive to change?

[1] Learn to shake the salt habit. MSNBC.com. May 23, 2008. http://www.msnbc.msn.com/id/23694159/

[2] Why should I limit sodium? American Heart Association. http://www.americanheart.org/downloadable/heart/119618381045822%20WhyShldILmtSodium%209_07.pdf

[3] Incremental cost of treating hypertension in the United States. Sanheev Balu. Purdue University. http://docs.lib.purdue.edu/dissertations/AAI3191421/

[4] Processed food. Sodium 101. http://www.sodium101.ca/en/everywhere/processedfood.html

[5] Campbell’s USA. http://www.campbellsoupcompany.com/atw_usa.asp

[6] Campbell’s Financial highlights 2008. http://www.campbellsoupcompany.com/annualreport2008/highlights.asp

[7] Sodium guidelines set by the FDA. American Heart Association. http://www.americanheart.org/presenter.jhtml?identifier=4718

[8] Salt content of foods. Center for Science in the Public Interest. http://cspinet.org/new/pdf/saltupdatedec08.pdf

[9] A Missing Link between a High Salt intake and Blood Pressure Increase, Kitasato University School of Medicin. http://www.jstage.jst.go.jp/article/jphs/100/5/370/_pdf

Developed by: Douglas Frosst, June 2009

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