Salmonella to have no lasting impact on peanut demand: USDA

02-Feb-2010 - Last updated on 03-Feb-2010 at 16:56 GMT

Last year’s deadly salmonella outbreak linked to peanut products will have no long term impact on peanut demand and production, according to a report from the USDA’s Economic Research Service (ERS).

The report looked at the impact on the processing, production, price and supply of peanuts since the salmonella outbreak originating at the Peanut Corporation of America’s Georgia and Texas plants that was linked to more than 700 illnesses and nine deaths across the country. The outbreak also led to the recall of more than 3,900 peanut-containing products from more than 200 companies – one of the largest product recalls in US history.

The ERS report said that despite a temporary slowdown in demand for peanut products in the direct aftermath of the outbreak, retail purchases quickly returned to normal and peanut processing volumes for the 2008-2009 marketing year actually increased from the previous year, up 1.5 percent.

The report concluded: “These developments suggest that the recalls will not have a lasting impact on peanut demand and production.”

This conclusion tallies with that of the National Peanut Board, which has claimed that sales volumes of peanuts quickly rebounded as a result of the weakened economy – as consumers turned to peanuts as a cheap source of protein – in conjunction with increased food bank use, a marketing push, and peanut butter’s all-American appeal.

Compensation

Although the impact of the outbreak on food manufacturers, processors and producers may be less than previously feared, the report acknowledged that the contamination has had a political impact, bringing the issue of American food safety to the fore.

Shortly following the report’s publication it also emerged that 123 victims of the outbreak and their families who filed claims against the Peanut Corporation of America (PCA) before October 31 are set to receive a share of a $12m payout from the company’s insurance firm, Hartford Financial Services Group. Lawsuits against suppliers of products containing contaminated nuts, including Kellogg’s and King Nut, are still pending.

Since the salmonella outbreak came to light in January last year, the PCA has declared bankruptcy and a criminal investigation is ongoing.

A full copy of the ERS report can be accessed online here.