BusinessJun 22, 2026
Retailers and Food Companies Face Pressure From New SNAP Rules
Policy Headwinds
Rhea Lobo
Discover
The USDA approved SNAP purchase restrictions in 23 states, affecting roughly one-third of program recipients. The changes could reduce food and beverage sales by up to $830M this year, according to Numerator.
Most waivers target sugar-sweetened beverages and confectionery products. Companies including Hershey, PepsiCo, Coca-Cola, Kraft Heinz, General Mills, and Nestle are all monitoring how shoppers respond to the new limits.
Hershey has deployed researchers in Texas to conduct in-store interviews with SNAP recipients, studying product substitutions and budget tradeoffs as restrictions take hold.
"We've observed some consumer uncertainty at the register as new restrictions take effect," a Hershey spokesperson told CNBC.
Kroger CEO Greg Foran said recently that customers are managing their spending carefully, citing reduced SNAP benefits and higher gas prices as budget pressures.
Walmart is particularly exposed, capturing roughly one-quarter of all SNAP grocery dollars nationwide.
Roughly 3.5M SNAP recipients lost their benefits between July 2025 and February 2026, according to the Center on Budget and Policy Priorities.
That decline followed Trump's One Big Beautiful Bill, which tightened eligibility rules and expanded work requirements to new age groups.
Arizona lost 51% of its SNAP beneficiaries over that period. Louisiana saw roughly a 20% drop. SNAP participation fell in every state, even as the national unemployment rate held steady at roughly 4%.
Food banks are struggling to absorb the shortfall. SNAP provides roughly nine meals for every one meal a food bank provides, according to advocates, making a direct substitution impossible.
Stores that accept SNAP are caught in the middle. The USDA recently finalized a new retailer stocking rule requiring authorized shops to carry at least seven varieties of food across four staple categories, effective fall 2026. That is more than double the previous requirement.
The rule is designed to expand healthy food access, but smaller retailers face a harder path. Convenience stores and bodegas will need to update checkout systems to block SNAP payments on banned items and comply with the new stocking standards.
A community health scholar at Tufts University warns those burdens could push some small shops to stop accepting SNAP altogether, leaving fewer options for low-income shoppers.
On the product side, General Mills, Kraft Heinz, and Target have pledged to phase out certain artificial colors and additives by 2027.
Iowa recently became the first state to codify MAHA-aligned restrictions into law, banning synthetic dyes including Red 40 and Yellow 5 from K-12 school meals and limiting SNAP purchases of soda and candy statewide.
The policy pressure on food manufacturers is not set to ease anytime soon.
