Fallout from P.C.A. recall is wide

by Keith Nunes
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KANSAS CITY — Data from The Nielsen Co. shows that while the peanut-related recall from ingredients manufactured by the Peanut Corporation of America’s Blakely, Ga., processing facility is having minimal effect on prepackaged peanuts the impact on jarred peanut butter is stark. In the four weeks ended Jan. 24, jarred peanut butter sales tracked by Nielsen totaled $72.5 million, down 11.5% from the previous four-week period and down 3.8% from the same period a year ago. The year-over-year decline follows eight consecutive months of double-digit growth in the category.

In total, 33.8 million lbs of jarred peanut butter were sold in the most recent four-week period, down 11% from the previous period and down 22% from the same period a year ago, according to Nielsen.

Meanwhile, prepackaged peanuts, which include bags, cans, jars and unshelled peanuts, posted sales of nearly $32 million, down 26% from the previous four-week period and down 1% from the same period a year ago. Nielsen attributed the decline to "the typical seasonal pattern seen for each of the past four years."

"The peanut butter outbreak shows little ill-effect on prepackaged peanuts, but the peanut butter category is definitely showing the impact," said Todd Hale, senior vice-president of Consumer & Shopper Insights at Nielsen. "It would appear that manufacturers and retailers are quickly removing potentially tainted products off of store shelves. For those who are not affiliated with the particular supplier of tainted product, now is the time to take extra measures to educate consumers and minimize any negative impact."

As of Feb. 10, 1,914 varieties of products possibly containing ingredients supplied by the P.C.A.’s Blakely facility had been recalled. It is the largest U.S. food recall ever.

As the recall has evolved questions have emerged about the conditions with which the P.C.A. manufactured its products at the Blakely facility. The F.D.A. has opened a criminal investigation and the Federal Bureau of Investigations is participating in the matter.

Prior to the initiation of the criminal investigation, on Feb. 4, and citing "a great deal of confusing and misleading information in the media," the P.C.A. issued a statement that said there were regular inspections and visits to the company’s Blakely facility by federal and state regulators during 2008. The company also said independent audits were conducted at the plant and one auditor gave the plant an overall "superior" rating, and another rated the plant as "meet or exceeds audit expectations."

A week later, on Feb. 11, it was a different story as Stewart Parnell, president of the P.C.A., responding to a subpoena issued by the House Sub-committee on Oversight and Investigation of the Energy and Commerce Committee, refused to give testimony or answer committee questions.

The hearing came after the F.D.A. amended its investigation report from the Blakely plant and alleged that managers shipped product that tested positive for Salmonella to customers before receiving the results of follow-up tests.

On 10 separate occasions dating back to June of 2007, F.D.A. investigators found records showing that after the P.C.A. received test results showing a positive sample for Salmonella, the company would conduct a follow-up test, but ship product before the additional results were returned. The most recent event occurred on Aug. 11, 2008, when "creamy stabilized peanut butter" tested positive for Salmonella. The P.C.A. had two laboratories do follow-up tests that came back negative. Before receiving the results, the P.C.A. had shipped some of the product in question.

At the hearing, Dr. Darlene M. Cowart, president of JLA, USA, Albany, Ga., a testing laboratory used by the P.C.A., testified that from Jan. 1, 2007, through September 2008 her company tested approximately 1,000 samples of product from the P.C.A. Of the samples taken in 2007, six were confirmed positive for Salmonella and all the rest were negative.

"In 2008, we issued a total of four confirmed Salmonella positive C.O.A.’s," Ms. Cowart said.

Following Ms. Cowart’s testimony, Charles T. Deibel, president of Deibel Laboratories, Inc., testified that his company did not provide day-to-day testing services to the P.C.A., but did test samples upon request. He said Deibel Laboratories did identify a sample that tested positive for Salmonella in September of 2008.

"It is not unusual for Deibel Labs or other food testing laboratories to find that samples clients submit do test positive for Salmonella and other pathogens, nor is it unusual that clients request that samples be re-tested," he said. "What is virtually unheard of is for an entity to disregard those results and place potentially contaminated products into the stream of commerce."

As the P.C.A. recall story has unfolded, there has been much discussion about reforming the nation’s food safety system (see story on Page 1). On Feb. 6, Secretary of Agriculture Tom Vilsack added his voice to the discussion when he suggested the current Salmonella outbreak and recall of peanut products manufactured by the P.C.A. at its Blakely plant raised the question whether a single food safety agency might be preferable to the current system where the U.S. Department of Agriculture’s Food Safety and Inspection Service inspects meat and poultry and certain other products while an underfunded Food and Drug Administration has oversight for the rest of the food supply.

"You can’t have two systems and be able to reassure people you’ve got the job covered," Mr. Vilsack said. "This is a grand opportunity for us to take a step back and rethink our approach."

This article can also be found in the digital edition of Food Business News, February 17, 2009, starting on Page 14. Click here to search that archive.

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