Peanut recall has U.S. consumers "spooked": experts

CHICAGO (Reuters) - “We have temporarily discontinued the use of peanuts,” reads a handwritten sign behind the register at Penny’s Noodle Shop in Oak Park, Illinois.

Although the Asian noodle shop did not get its peanuts from the U.S. peanut plant at the center of a widespread salmonella scare, it has stopped using them anyway. “You just don’t want to take a chance,” said manager Louie Paine.

Penny’s is not alone.

The recall of tainted peanut butter and peanut products made by Peanut Corporation of America is reaching far beyond the businesses forced to recall 1,790 potentially tainted foods ranging from ice cream to pet treats.

Makers of major peanut butter brands -- including Jif, Skippy and Peter Pan -- have seen sales fall nearly 25 percent since the recall began last month, according to Chicago-based market research firm Information Resources Inc.

The salmonella outbreak traced to the plant in Blakely, Georgia, has sickened at least 575 people, more than half of them children, and may be connected to eight deaths. Authorities say they have found evidence that plant management intentionally shipped salmonella-tainted products.

“These things kind of spook consumers,” said Bob Goldin of Technomic Inc, a Chicago-based food industry consulting firm, said in a telephone interview. “I think part of it is you think they’ve gotten it all and it keeps getting worse.

“It is undermining consumer confidence in the food supply,” Goldin said. “Until recently consumers thought everything was fine. Now, I’m not sure consumers think that.”

The peanut outbreak is the latest in a series of incidents involving lettuce, peppers and spinach that have eroded public confidence in food safety and renewed calls by many for change at the U.S. Food and Drug Administration.

Despite FDA assurances that major peanut butter brands in stores are safe, J.M. Smucker Company ran ads in major newspapers on Friday assuring consumers that it “does not buy peanuts or any ingredients from Peanut Corp of America.” It also offered a coupon for 35 cents off to entice consumers.

ConAgra Foods Inc ran a similar ad vouching for the safety of its Peter Pan brand the next day and threw in a coupon for 50 cents off. Unilever is considering some marketing activities for its Skippy brand, said company spokeswoman Anita Larsen.

“Consumers have questions,” said Stephanie Childs, a ConAgra spokeswoman. “They are looking for information. That is what is driving our action to reach out to consumers.”

Joe Hotchkiss, a professor of food science at Cornell University in Ithaca, New York, said consumers tend to “paint with a rather broad brush” when it comes to recalls.

“You can’t remember exactly which peanut butter it is so the whole category of product gets a black eye,” he said.

Hotchkiss, a former FDA employee and frequent adviser to the agency, said the recall points out the problems with how food is regulated in the United States.

“We can do better,” he said, supporting the notion of a food safety “super agency” in which foods regulated by the FDA and the U.S. Department of Agriculture are combined.

Editing by Bill Trott