Killer food carnage

2018-03-06 18:06
Empty shelves at Checkers in Scottsville Mall after cold meats were removed.

Empty shelves at Checkers in Scottsville Mall after cold meats were removed. (Ian Carbutt)

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The contagion caused by the killer food scare spread to the financial markets on Monday as Tiger Brands, owner of the Enterprise brand that withdrew its ready-to-eat meat products from shops due to the listeriosis outbreak, took a beating on the JSE.

The share price fell almost 13% to R370,30 at one stage as a financial contagion from the disease set in, and by 3.15 pm, was still trading 7,7% weaker at R392,22.

The shares of RCL Foods, owner of the Rainbow Chicken brand, also fell 2,15% to R16,83, after polony and Russians made at its factory in Sasolburg were also recalled from store shelves.

Ryan Bruwer, partner at Durban-based Sala Pork that owns the Georgie’s brand, said there was certainly valid concern among consumers about this disease.

He was also concerned about the potential impact on the broader food industry, because consumers would become cautious in buying meat products.

Bruwer urged consumers not to panic and said the bacteria is usually only dangerous to individuals with compromised immune systems. The bacteria is immediately killed with cooking, he said.

Tiger Brands CEO Lawrence MacDougall said in a briefing on Monday there was no clear link at this stage between the 180 people who have died from the disease and the group’s products.

Also read: ‘I have to throw all the polony away’

On Sunday the Department of Health ordered Tiger Brands to recall three Enterprise polony, Russians and frankfurters product types, but, in the interest of consumer safety, MacDougall said they had recalled all the group’s cooked, chilled meat products.

Its chilled meat factories in Polokwane and Germiston had been halted to do cleaning.

Around the country, supermarkets pulled processed meat products off their shelves and called on consumers to return these products for a refund.

MacDougall did not at this stage have an estimate of the total cost involved. He said also that no thought had yet been given on how to regain consumer trust in their brands, because at this stage, their main concern was to protect the health of their consumers.

Tiger Brands sold R31,7 billion of food products in its 2016 financial year, with value-added meat products contributing R2,23 billion of that, and which realised R158 million in operating profit.

The economic fall-out was sure to widen as neighbouring countries on Monday recalled and halted imports of processed meats from South Africa. Steps were taken by Botswana, Namibia, Malawi, Mzambique and Zambia.

RCL has also withdrawn from the market ready-to-eat polonies made at its factory in Sasolburg, following an investigation into the plant by the government, and even though the results from testing of its environmental samples by the Department of Health are still pending.

RCL said on Monday that the issue is being treated “as a crisis internally, and a senior team is in contact with all relevant stakeholders to discuss the impacts”.

Tiger’s MacDougall, and RCL both claimed they have strengthened what were already rigorious health and safety protocol procedures as a precautionary measure.

“More players in the industry will be performing similar steps just to keep their hands clean,” said Casparus Treurnicht at Gryphon Asset Management. “Perhaps a total shutdown is the only way to eradicate the bacteria.”

Meat producer Eskort called for calm after Health Minister Aaron Motsoaledi’s announcement on Sunday that processed meat was the source of South Africa’s worst listeriosis outbreak on record. As of Sunday, the outbreak had claimed 180 lives and hospitalised 1 000 since January 2017.

Eskort, which has been in operation in South Africa for 101 years, said its products are not manufactured in Limpopo province, where Motsoaledi identified the source of the outbreak.

Eskort has factories in Estcourt in KZN, and in Heidelberg, Gauteng.

All tests on Eskort products have been confirmed as negative across the Eskort range of Russians, polony, Viennas and bacon, the company said.

Read more on:    pietermaritzburg  |  listeriosis

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